Satyam Computers Services Ltd Founder and Chairman confessed of accounting fraud to the extend of $1 bn. Excerpts from Raju’s letter follows,
The Balance Sheet carries as of Sept 30, 2008,
- Non existent cash and bank balances of Rs 5,040 cr
- An accrued interest of Rs 376 cr which is non-existent
- An understated liability of Rs 1,230 cr on account of funds arranged by me
- An overstated Debtor’s position of Rs 490 cr as against Rs 2,651 cr reflected in the books
For the September Quarter, a revenue of Rs 2,700 crore and an operating margin of Rs 649 crore was reported as against the actual revenues of Rs 2,112 crore and an actual operating margin of Rs 61 crore.
The gap in the Balance Sheet is on account of inflated profits over a period of last several years. What started as a margina gap between actual accounting profits and the one reflected in books of accounts continued to grow over the years… Read the full letter here [PDF]
So who is next in line ? Anil Ambani’s Reliance Communications is already probed for Evasions. Indian Real Estate Companies are also known for their Inflated Land Bank Values… Will the truth ever come to light ?