The Marathi press on the Satyam scam

Corporate governance has of late been a matter of controversy and needs thorough scrutiny. This is more so in the state where companies registered under the Company Act are more in number and are having inter-state and also global connections with both the customers as also share holders. While there are a good number of companies in Maharashtra, Mumbai being a sort of national international financial centre, the way Marathi newspapers have expressed their opinions and comments about the Satyam phenomenon has special significance.  

 

Lokasatta of the Express Group has editorially commented that the Satyam scam has thrown almost a bomb of fraudulent dealings thereby exposing the private enterprises and their auditors who boast of fair deal and transparency. The paper says chairman Raju has shown that  he is a villain who has recorded inflated figure of Rs.7000 crores in the balance sheet, a fraud that has victimized large number of share holders and investors. Price Waterhouse Coopers is an  auditing firm of international repute but its participation in the fraudulent deal of its client Satyam, if exposed in future, it will not be a matter of surprise as it has relevance to similar frauds by banks and financial institutions in America. Raju is 54 and is  an MBA from an  American University. His fraud has pointed out as to how well-dressed, sophisticated personalities can have ability to act in criminal style. The scam has created doubt about  credibility of corporate deals, auditor firms, rating agencies, bankers and regulatory agencies like SEBI and it is now necessary to appoint auditors which are not managed as happened in this case.

 

The daily Samana,  mouthpiece of  the Shivsena, has described this development as the economic murder of lakhs of investors. The editorial has pointed out that Harshad Meheta’s fraud of Rs.4000 crores was exposed in 1992 and it was in the same year that the Satyam was listed on the  share market. If SEBI would have been prompt and active enough to check the balance sheets and dealings of the Satyam in time, the fraud would have been exposed in time. If half-yearly and annual reports and balance sheets of companies approved by SEBI are later found to be fraudulent, how would share holders and inventors believe in such reports and balance sheets? The question is raised with warning that in future investors have to be more careful about the persons who are manning the company.        

 

Maharashtra Times of the Times Group has commented that after the terror attack on Mumbai, Satyam has again exposed the lethargy and carelessness in administration in our country. Just as terrorists enter in our country and pose challenge to Indian government for three days, without any pre-intimation and alertness of intelligent agencies, Satyam, an IT company of international repute produces fake balance sheets showing cash balance of Rs.5000 when not a single pie is with it and no regulatory agency has been able to expose the fraud. Even after the exposure of the fraud, the government should have immediately arrested Raju and should have sealed all offices and assets of this company, but no instant action was taken. The requirement is that companies’ and financial institutions balance sheets should be published in newspapers for transparency and knowledge of people and investors in particular. But the Satyam fraud has created doubt about the published balance sheets and it has now become necessary to let experts examine strictly balance sheets of all reputed companies so as to avoid similar frauds in future.