Today the Media has been airing, what they attribute to sources,that the jailed and disgraced Promoter Chairman of Satyam,Ramalinga Raju,has disclosed on interrogation that he has been fudging the Books of satyam for the last Seven Years !
So we are talking about “Saat-Yama” !…That’s Seven Years which heralded the Beginning of the End with the God of Death,Yama, Dancing around in the Accounts !
So this would mean that the Re-statement of Account has to be atleast from the Financial Year 2000-2001
The Government has stepped in and constituted a New Satyam Board that begins with three Members, Deepak Parekh,Karnik and C Achuthan…The New Board appeared before the Media this evening and it was conveyed that an Independent Firm of Auditors will be appointed in the next 48 hours to get working on restating the Accounts
This has to be the Priority,as No urgent funding can be obtained unless the Accounts reflect the true state of Affairs…Banks will not lend
My advice is to begin with the Accounts of FY 2000-2001 as this would then include investigation of the hyped Indiaworld Deal between Sify and Rajesh Jain for US $ 116 Million
Read Ramalinga Raju’s Chairman Statement in the Annual Report of FY 2007-8…Incredulous !….This man knew he was lying,as he had been cooking the Books for Seven Years and yet he had the Boldness & Brashness to boast of Satyam Success
Methinks he would make an interesting case Study for Psychiatrists…this guy had to be psychotic as he lost contact with external reality….what was he thinking !? to have persevered with Seven Years of Creative Accounting and not be found !…..and perhaps the Auditors too would make an Interesting Case study for how they failed to Detect such Creative Accounting !
Interestingly,the jailed CFO,V Srinivas too has confessed that he was completely in the dark on what Ramalinga Raju did…he was only concerned with quarterly results and never looked at the Balance Sheet.He was only instructed by Ramalinga Raju and his Brother,to manage payments with Operational cash and when some Payments got delayed,he suspected something was wrong !…This is realy difficult to swallow ! As CFO for years he had to be privy to what was happening…he did say that the Fixed Deposits were fictitious !….Also he was invited to and attended every Audit Committee Meeting that also included four Independent and Non Executive Directors as Members and both the Auditors,Internal and Statutory as Invitees
“Saat – yama” ! what a Sorry State of Affairs
Satyam Share Price jumped from Rs 20 close on Friday to close at Rs34 today on some hope with this New Board at the helm….Yet till date several Class action suits have been filed against Satyam already in USA…this exposes the Company to Hundreds of Millions of Dollars in Liability Claims….Cannot see how Satyam,in this Legal Form can survive….As I blogged earlier,Transfer of Business Contracts and Employees to another Company would salvage Clients and Employees,leaving Satyam only as a shell company…problem is the Status of Existing Shareholders…their Holdings would amount to Zilch in such a shell Company that would be battling Legal Cases….If they too can be allotted shares for free in proportion to their holding in Satyam in the New Company,then they could recoup losses through this new Holding…It must be checked if this could be a legally tenable option…Class Action Suits in USA would not be able to touch the New Company….they may then involve the Auditors,Price Waterhouse in their suits.
In another Blog I’ll post, for especially those who have no finance and accounting background,the nature of fictitious Accounting Entries that would have been passed to inflate Revenues,Cash and Receivables and Profits and their Impact in the Profit and Loss A/c and the Balance Sheet ….Readers would gain a better insight into what really happened in Satyam
8 thoughts on “Satyam is actually “Saat-Yama” !”
Stumbled upon your blog. Quite an interesting perspective. Am a journalist with Indian Express based in Hyd and been tracking the Satyam saga. Would be glad to have a conversation with you. Let me know if that suits you. Request you to mail me your email id and contact number for further correspondence.
Hi Sunitha…just emailed you…thanks for ‘stumbling’ onto my blog….hope you enjoy viewing it as much as I enjoy posting these blogs…Cheers !
Did you hear that Ram the former CEO and Board member is in US ?
Over 60 lakhs of shares have been sold in the past 3 quarters by Satyam senior executives like Ram, Ravi B., Keshab, Virender, Pavan Kumar, Hari T., Sriram and others.
After engaging in brazen illegal trading, are the Indian investigating agencies and hard-working Satyam employees going to allow these executives to just walk away scot-free?
At least Mr. Raju had the guts to confess and is willing to face the consequences.
What about these cowards who are still burning the midnight oil to forge documents and steal more money?
There are a ton of documents and emails implicating these people out there.
BTW, I was talking to a senior account executive who used to report to Ram a few years back. He says that Ram used to be pretty fond of his limo and could always be seen even doing his grocery shopping using his limo!
Thanks for your Response
Yes,I’m clued into Satyam Developments
By setting a precedence by confessing,Ramalinga Raju has created a huge problem for a host of others in and out of Satyam to come clean too
It’s a cesspool out there…Company Promoters,Politicians,Auditors,Bankers,Top Management,Directors,Government Entities,Group and Associate Companies….just every angle is bringing out the worms from a rotting wood…….confirms India’s notorious and dubious world image and standing in that Corruption has acheived Industry status in India
Expect more fireworks
It’s a shame that the focus has been only on Raju, while the other accomplishes – the top 20 Satyam execs are getting away free. It does not take too much to realize that these guys knew what was going on. Instead of complying with their fiduciary duty and protecting the company and its investors, these top 20 execs decided to become crooks and indulged in insider trading. I read another news item that many of them are under investigation by SEBI. I hope these crooks are also locked up like the Rajus. All their assets should be seized and returned to the investors.
Ram is not the only Satyam exec that wasted company money. Most of them took lavish vacations at luxury resorts with enitre family all on company money. One exces wife once boasted how they were entertained at Wimbledon at company expenses. Rajus and CFO have been caught, but these cother criminals are still free. The investors lost their money, the other innocent satyam employees are at great financial uncertainty; but these top 20 execs have made $$millions from systematica insider trading over 2008.
Hi Enraged Indian,
I am not surprised to hear your views. I am aware of the lavish lifestyles and shameful practices of people like Ram, Pavan Kumar, Virender, Keshab and several former executives like Prabhat.
Many of these executives have managed to dupe the employees for a long time. Even a cursory look into their finances can create major problems for them.
Still, we are yet to see any real investigative reporting or action by the authorities.
At least Raju created jobs and built his company brick by brick. What did these criminals do to add value?
I have heard that the US class action suits could take an interesting turn.
One of my hypothesis is that the satyam execs that you have named and a few more found out about Raju’s fraud at least couple of years back. They then black-mailed Raju. Evidence – compare the equity awards these guys received in 2006 onwards with execs in similar position at INFY, WIPRO etc. While Raju took the cash, the execs sold their holdings and remained silent.
I frequently meet one of the execs you have named in my social gatherings. This guy was always pro-India and would always defend Indian business as the best in the world. Surprisingly in Nov 2008, he turned very negative about the practices in Indian business houses. At that time I asked him why the sudden change in his opinion. He remained silent. Now I think it all adds up. I think, he knew about the Maytas fraud and was perhaps aware of Raju’s cooking of the books and was reacting subconsciously.
It’s a shame that the authorities in India are very slow about taking action on these accomplishes in Satyam fraud.
Now the US investigation by SEC could be a very different thing. The Satyam execs based in US will have a difficult time with SEC. The satyam fraud is similar to the HealthSouth fraud in USA. After all SEC actions, I believe the CFO now mows lawns and earns only $30K per year.