US watchdog imposes sanctions on 2 Satyam auditors

Written by: Super Admin
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New York, Mar 18: Two Indian auditors affiliated with PricewaterhouseCoopers have sanctioned by the US accounting watchdog for failing to detect a multi-year fraud at Indian technology services company Satyam Computer Services Ltd.

Satyam, renamed as Mahindra Satyam, hit the headlines when its founder and chairman B Ramalinga Raju revealed that profits had been overstated for years.

Satyam's auditors at that time were an Indian affiliate of PwC called Lovelock & Lewes.

In a document dated Mar 16, Public Company Accounting Oversight Board (PCAOB), a US agency responsible for monitoring audit firms, announced that it would bar two accountants reponsible for the Satyam audits from 'being an associated person of a registered public accounting firm'.

The PCAOB, in-charge of the investigating audit firms as part of the 2002 Sarbanes-Oxley reforms, cited non cooperation from the auditors, Siva Prasad Pulavarthi, 43, and Chintapatla Ravindernath, 38, into the Satyam scam.

PCAOB document added that Prasad and Ravindernath, both an engagement managers on Satyam's audits for several years, said through their lawyers that they would not comply with the PCAOB's demands for their testimony.

While the attorneys for the two auditors could not be contacted, the PCAOB documents said the duo had consented to the sanctions and had submitted settlement offers to the Board, without confirming or denying their involement in the fraud.

After the Satyam scam came to light, PricewaterhouseCoopers on Jan 2009 said that all Satyam audit reports from 2000 through 2008 should no longer relied upon.

OneIndia News

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