Shares of Satyam Computer Services crashed 80%, after the founder and chairman of India’s fourth-largest software company resigned, saying the company had inflated its cash and bank balances on the balance sheet by more than Rs.5000 crores.
Chairman B. Ramalinga Raju said the balance sheet as of Sept. 30 had inflated non-existing cash and bank balances.
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 him.
* An overstated Debtor’s position of Rs 490 cr as against Rs 2,651 cr reflected in the books.
PriceWaterhouse Coopers – PwC India is the Auditor of Satyam Computers which let the $1 bn scam happen under its nose.
This announcement sparked a rout in its shares and rocking confidence in the broader Indian markets.The Bombay Stock Exchange’s 30-stock benchmark Sensitive Index, or Sensex, closed down 7.3% at 9,586.88, having fallen as far as 9,510.
That was really shell shocking..for such an established company,with business with 185 of Fortune 500 companies.
Corrupt SEBI, Auditors and Greedy promoters are to be blamed.