Date:08/01/2009 URL: http://www.thehindu.com/2009/01/08/stories/2009010856750400.htm

Andhra Pradesh - Hyderabad

Parties demand probe into Satyam ‘affairs’

Shocking how regulatory authorities, auditors failed to detect the irregularity: BJP

HYDERABAD: Lok Satta Party president Jayaprakash Narayan on Wednesday demanded a through investigation by regulatory agencies into “monumental accounting fraud” in Satyam Computers and stringent punishment to the guilty.

In a statement he said the “colossal failure” of the internationally-reputed auditing firm Pricewater Cooper in the Satyam case reminded one of the role of Arthur Anderson in the Enron case and undermined people’s faith in corporate governance.

“It is possible that other corporate bodies too may have been resorting to accounting jugglery”. It was high-time that the Government and regulatory agencies thoroughly reviewed the accounting practices of all big entities and plugged loopholes.

He said an exercise on a war-footing was necessary to restore public confidence in Indian corporate governance both nationally and globally.

B.V. Raghavulu, CPI(M) secretary, in a statement while maintaining that it was not just a case of failure of corporate governance, demanded legal action against those responsible for the fraud.

Strict measures should be taken to avoid such irregularities.

He urged the Centre and SEBI to intervene and resolve the issue and ensure protection of employment of all those associated with the company.

Bandaru Dattatreya, State BJP president, said the Satyam episode was an eye-opener for both the Central and State Governments.

It was shocking how the regulatory authorities and auditors failed to detect the irregularity.

Meanwhile, the Federation of Andhra Pradesh Chambers of Commerce and Industry (FAPCCI) said the “overambitious” approach of the promoters to make use of the “good brand name” of Satyam to develop their family concerns, in pursuit of which they violated principles of good corporate governance, was the main reason for the collapse of Satyam.

Suraj Prasad Agarwal, FAPCCI president, said in a statement that Satyam episode would serve an example for the captains of industry how urgent was the need for good corporate governance.