Learning from the Satyam scam
Learning from the Satyam scam
This refers to “Satyam scam: India’s biggest accounting fraud” (April 10). The IT firms essentially have huge cash assets generated by the very nature of their business. As is wont, the problems arise as a string of subsidiary companies are set up to channel the spare funds to speculative areas as real estate and the likes to provide cover to the transfers. The Satyam saga is now seen to have been deviously scripted with pliable auditors. The law has since been amended to put greater onus on the auditor, but the taking a call on the success of its application will have to wait till after the next fraud. There must be an ‘audit forensics’ system that would put the audit reports from medium/large firms through a well designed technical scan. Based on these, the auditor/audit firms must be evaluated and where indicated, called to question. The prospect of a regular, even random audit scan would help substantially attain its purpose that of elevating the quality of the audit and the personal stake of the auditor. The long delay in the Satyam investigation would only help trigger suspicion on a selective sanitisation of evidence, for whatever reason. On a happier note, the quick repair through restructuring of the company, besides helping out both employees and shareholders, has reinforced our reputation for “intelligent jugaad”.
Fast-track appeal processes
This refers to the report “Satyam lies get Raju seven years in jail and R5 cr in penalties” (April 10). It is laudable that the special court for economic offences in Hyderabad has sentenced Ramalinga Raju, the Satyam founder and nine others, including his brother Rama Raju, involved in the biggest Corporate scam of the nation to 7 years rigorous imprisonment and appropriate fines. It is also heartening that, nowadays, the courts take serious view of such criminal offences including cases filed not only against such corporate criminals but also against politicians involved in corruption, irrespective of their position or status. However, such worthy judgments get diluted when the accused are allowed to be out on bail for long as the cases get dragged for years together in the higher courts on appeal. Moreover, with the efflux of time, the perception of the severity of the crime committed by the accused gets diluted, leading to reduction in the punishment already awarded or even the culprits getting exonerated by the higher courts. Such sensitive cases, involving siphoning off of public money through illegal means, including corruption, will have to be taken up on special fast-track basis and verdicts given within two or three months on their appeals. Otherwise, all efforts taken by such honest judges of the special courts would go to waste.
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