The court also imposed a fine of Rs 5 crore on Ramalinga Raju, the Satyam Computer Services Ltd's founder and former chairman, and his brother B Rama Raju and Rs lakh each on the remaining accused. HT presents a lowdown of the country's biggest-ever corporate accounting scandal. What is the Satyam scam about? It is about corporate governance and fraudulent auditing practices allegedly in connivance with auditors and chartered accountants. The company misrepresented its accounts both to its board, stock exchanges, regulators, investors and all other stakeholders. Even basic facts such as revenues, operating profits, interest liabilities and cash balances were grossly inflated to show the company in good health.
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The Satyam Computer Services scandal was a corporate scandal affecting India -based company Satyam Computer Services in ,  in which chairman Byrraju Ramalinga Raju confessed that the company's accounts had been falsified.
On 7 January , the chairman of Satyam, Byrraju Ramalinga Raju , resigned, confessing that he had manipulated the accounts of Rs 14, crore in several forms. The global corporate community was said to be shocked and scandalised. In February , CBI took over the case and filed three partial charge sheets dated 7 April , 24 November , and 7 January , over the course of the year.
On 10 April , Byrraju Ramalinga Raju was convicted with 10 other members. PricewaterhouseCoopers affiliates served as independent auditors of Satyam Computer Services when the report of scandal in the account books of Satyam Computer Services broke. SEBI also ordered disgorgement of over Rs 13 crore wrongful gains from the firm and 2 partners. PwC announced their intent to get a stay order.
The senior leaders of Satyam stand united in their commitment to customers, associates, suppliers and all shareholders. We have gathered together at Hyderabad to strategize the way forward in light of this startling revelation. On 10 January , the Company Law Board decided to bar the current board of Satyam from functioning and appoint 10 nominal directors. The credibility of the IT industry should not be allowed to suffer. He was arrested later and kept in judicial custody. Analysts in India have termed the Satyam scandal India's own Enron scandal.
Immediately following the news, Merrill Lynch now a part of Bank of America and State Farm Insurance terminated its engagement with the company. Also, Credit Suisse suspended its coverage of Satyam. SEBI, the stock market regulator, also said that, if found guilty, its license to work in India may be revoked.
Ramalinga Raju was charged with several offences, including criminal conspiracy, breach of trust, and forgery. Satyam's shares fell to The Indian Government has stated that it may provide temporary direct or indirect liquidity support to the company.
However, whether employment will continue at pre-crisis levels, particularly for new recruits, is questionable. On 14 January , Price Waterhouse, the Indian division of PricewaterhouseCoopers , announced that its reliance on potentially false information provided by the management of Satyam may have rendered its audit reports "inaccurate and unreliable". On 22 January , CID told in court that the actual number of employees is only 40, and not 53, as reported earlier and that Mr.
The Indian government designated A. On 4 November , the Supreme Court granted bail to Ramalinga Raju, as well as two others accused in the scandal, since the investigation agency CBI had failed to file a charge sheet, despite having already had 33 months from the time of Raju's arrest to do so. On 15 September , the special CBI court hearing the case asked the concerned parties to appear before the court on 27 October Date of judgement was to have been indicated later on that day.
On 9 April , Raju and nine others were found guilty of collaborating to inflate the company's revenue, falsifying accounts and income tax returns, and fabricating invoices, among other findings, and sentenced to seven years imprisonment by Hyderabad court. Effective July , Satyam rebranded its services under the new Mahindra management as "Mahindra Satyam".
After a delay due to tax issues   Tech Mahindra announced its merger with Mahindra Satyam on 21 March , after the board of two companies gave the approval.
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Whenever businesses and the economy falter, scams and scamsters tend to crawl out of the woodwork. Therefore, businesses having promoters even with slightly questionable practices should be looked at more than just normal suspicion. The tribunal had quashed the order but partly allowed disgorgement of the Rs 13 crore fee from the auditors concerned. In an interview to PTI, Gurnani said that even after ten years of Satyam Computer scam, "our systems still take a long time to get alerted to discrepancies which may lead to crisis situations".
Satyam scam: All you need to know about India's biggest accounting fraud
On January 7, , Ramalinga Raju sent off an email to Sebi and stock exchanges, wherein he admitted and confessed to inflating the cash and bank balances of the company. Weeks before the scam began to unravel with his famous statement that he was riding a tiger and did not know how to get off without being eaten. Raju had said in an interview that Satyam, the then fourth-largest IT company, had a cash balance of Rs 4, crore and could leverage it further to raise another Rs 15,, crore. Ramalinga Raju was convicted with 10 other members on 9 April Takeover by Tech Mahindra After the fraud came to the light, the government had ordered an auction for sale of the company in the interest of investors and over 50, employees of Satyam Computers. It was acquired by Tech Mahindra , and was then renamed as Mahindra Satyam, and was eventually merged into the parent company. Citibank froze all its 30 accounts in
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The Satyam scandal: How India’s biggest corporate fraud unfolded
The Satyam Computer Services scandal was a corporate scandal affecting India -based company Satyam Computer Services in ,  in which chairman Byrraju Ramalinga Raju confessed that the company's accounts had been falsified. On 7 January , the chairman of Satyam, Byrraju Ramalinga Raju , resigned, confessing that he had manipulated the accounts of Rs 14, crore in several forms. The global corporate community was said to be shocked and scandalised. In February , CBI took over the case and filed three partial charge sheets dated 7 April , 24 November , and 7 January , over the course of the year.