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The Truth Behind Trutham

B. Ramalinga Raju founded IT services company Satyam in 1987. In 2009, it was discovered that Satyam's accounts had been falsified for years, inflating cash balances, understating liabilities, and overstating debtors. This led to a $1 billion fraud and the company's stock price falling 55% on the New York Stock Exchange. The auditors, PwC, were accused of not detecting the fraud and were investigated by several Indian financial and anti-corruption organizations.

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121 views6 pages

The Truth Behind Trutham

B. Ramalinga Raju founded IT services company Satyam in 1987. In 2009, it was discovered that Satyam's accounts had been falsified for years, inflating cash balances, understating liabilities, and overstating debtors. This led to a $1 billion fraud and the company's stock price falling 55% on the New York Stock Exchange. The auditors, PwC, were accused of not detecting the fraud and were investigated by several Indian financial and anti-corruption organizations.

Uploaded by

niks2409
Copyright
© Attribution Non-Commercial (BY-NC)
We take content rights seriously. If you suspect this is your content, claim it here.
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Download as PPT, PDF, TXT or read online on Scribd
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The truth

behind

Trutham
Satyam
Some facts…
• Founded in 1987 by
 B.Ramalinga Raju.
• offers IT services to various 
sectors in 67 countries 
across six continents.
• listed on the New York 
Stock Exchange 
and Euronext.
• serves over 654 global 
companies, 185 of which are 
Fortune 500 corporations.
09/15/09 brainybetty.com 2
Some  harder facts…
• attempted to acquire Maytas 
Infrastructure and Maytas 
Properties founded by family 
relations for $1.6 billion though 
objected by independent directors.
• Forced the Govt. to investigate and 
the panic caused the shareholders 
lose 3400 crore INR and the stock 
at the NYSE fell by 55%.

09/15/09 brainybetty.com 3
B/S as on 09/30/08
• Inflated (non-existent) cash and bank
balances of Rs.5,040 crore (as against
Rs. 5361 crore reflected in the books)
• An accrued interest of Rs. 376 crore
which is non-existent
• An understated liability of Rs. 1,230
crore on account of funds arranged by
Raju.
• An over stated debtors position of Rs.
490 crore (as against Rs. 2651 [cr.]
reflected in the books)

09/15/09 brainybetty.com 4
How was PwC involved?
• ₤1 billion fraud for as long as 7
years.
• a straightforward falsehood that
the company's auditors might
have detected had they run a
rudimentary check

09/15/09 brainybetty.com 5
PwC is investigated by
• SEBI
• Indian government’s anti-
corruption office
• ICAI

09/15/09 brainybetty.com 6

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