Satyam ropes in KPMG, Deloitte; PwC says audit unreliable

Mumbai, Jan 14 (PTI) Satyam Computer Wednesday appointed
KPMG and Deloitte to restate its financials, even as Price
Waterhouse said its audit of the IT company's books may be
'unreliable' given the revelations of an accounting fraud.

"We have decided to appoint Deloitte and KPMG to assist
the board in the restatement of financial statements of
Satyam... as quickly as possible," Satyam board member C
Achuthan told PTI here Wednesday.

Satyam founder Ramalinga Raju on January 7 disclosed a Rs
7,800 crore financial fraud and admitted that he had been
cooking the books for several years.

The government and regulators, however, are not willing
to buy Raju's story as gospel truth and believe he did not
more than just inflate profits.

"Nobody is sure whether they are correct or there are
deficiencies... So the two companies have been given the job
of restating factual position of the accounts", Corporate
Affairs Minister Prem Chand Gupta said in Delhi Wednesday.

On a possible government aid to Satyam, he said: "Let us
not create panic in the market...minds of employees. Things
are being looked into by the government."

The roping in of KPMG and Deloitte comes amid a probe
into Satyam's accounts and the role of Price Waterhouse in it.

Price Waterhouse in a letter to Satyam's new board said
it would like to work with the company and "provide assistance
to the new board of directors to address any issues that arise
in the course of such investigations..."

PwC said its audit of the IT company's financials could
be "inaccurate and unreliable" in view of the financial
irregularities disclosed by Ramalinga Raju.

Copies of the PwC letter were marked to RBI, SEBI and
CBDT. Besides, a communique was sent to the bourses Wednesday.

It had previously said that its audit on Satyam was
supported by "appropriate audit evidence" and complied with
"applicable standards."

KPMG and Deloitte, however, cannot be termed as auditors
of Satyam as the appointment of an auditor can be done only
after securing the company's shareholders' consent.

Agencies investigating the Satyam fiasco conducted raids
at the PwC's Hyderabad office yesterday and are understood to
have recovered several documents.

The Hyderabad-based IT giant plunged into a crisis after
its former Chairman B Ramalinga Raju confessed to committing
serious financial irregularities over several years and
running into thousands of crores of rupees.