Satyam saga seems to have taken its toll not only in the sensex but also generated heat across the Indian IT industry. We hear the Infosys founder Mr. Narayanan Murthy beating it across as shocking but segregated case.
Where Mr. Ramalingam Raju finally quotes it as" We were riding a tiger, without knowing how to get rid off it without being eaten." The story started with Maytas acquisition which received wild furore from investors and eventually has revealed the hidden motives.
Raju has finally accepted that he was busy in giving shape to the India’s biggest fraud of around 7,000 cr INR. The company, well renowned among investors, well claimed globally and number 4 Indian Outsourcing is on the verge of meeting end. All that came was an apology to 53,000 employees and apparently a good luck wish.
The company was constantly boasting of higher margins and variating debt accounts. But what surprises people most is to how such big accountability could go unnoticed when they had four audits a year from world class agencies. With considerable good reputation and workforce of around 53, 000 people (workforce of Tata Steel+ Tata Motors), the company was very well on track- as was apparently obvious from what its financial reports cited. No one has ever dreamt that Raju was just faking it up. He was creating the fudging accounts and making a fool out of investors.
The self accepting note by CEO has lastly unveiled everything. Leaving the employers abuzz with shocking perceptions and investors unanswered, no one has ever thought that such a celebrated enterprise could exhibit such derogatory conduct.
The proposed Maytas acquisition plans that created unrest among investors and asked for backtrack, proved to be the turning point in the history of Satyam. The things are clear now, what was seen as a move by Raju to help his sons, in fact was an effort by him to shed his financial liabilities. That was an attempt by Raju to legalize his fake accounts and show on papers the actual transaction, which supposedly had never happened. The plea rendered is the constant cover up on the marginsand hence came in 7000 crore scam.
The revelation of such a big fraud is indeed harmful for developing economies. And, when the global economy is in trap of financial crunch, at that time, such frauds are really shocking.
The questions that rise amid such situations are: What about the directors? Were they really unaware or are faking it on the same pattern as of Ramalingam Raju? What will be the compensation for investors? What will be the employees fate? And above all, what about the annual audits that took place? What is the stand of corporate regulations governing such firms?
The questions are many but answer are none. What is even more concerning is a probe in the US and a consequent delisting of the concern from the Nasdaq.Market is in shocking state and share points on a steep downfall. No rescue for anything.
Really worry times for the sensex as well it seems.
Everything becoming gradually clear - 53, 000 employees just piling their CVs on job portals, investors finding their ways out to fight the losses which they have will face due to Satyam.
The investors have joint hands and have asked for a strict probe to bring justifications to their firms. Among worst hit investors are: Aberdeen Asset Managers Ltd, Fidelity, ICICI Prudential Life Insurance, Lazard Asset Management, and Life Insurance Corporation of India. They are asking Government to sack the present management. They want to punish the culprits but at the other end also want to bail out the company so that their investments can be saved.
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