HYDERABAD: Chief Minister Y.S. Rajasekhara Reddy described the Satyam debacle as a ‘systemic failure’ and said it should serve as a constant reminder to chartered accountants to be more cautious and vigilant in certification.

He said while the entire episode was a blot, it highlighted the need for more ethical and moral values among practising professionals and those studying to be a chartered accountant.

“You need to be guarded while certifying information furnished by the companies,” he stated, adding it was good that Satyam had ‘recovered very fast’. Inaugurating a two-day regional conference of the Southern India Regional Council (SIRC), Institute of Chartered Accountants of India (ICAI), he expressed confidence that India would come out of the recession very soon.

He appreciated the ICAI while referring to the statement of its president Uttam Prakash Agarwal that the institute and the Insurance Regulatory Development Authority were working on a low-cost product to help insure millions of farmers who frequently lost their investment to the vagaries of nature.

Mr. Agarwal later told reporters that a disciplinary committee formed by the institute had submitted its initial report to the Union Ministry of Corporate Affairs as part one of its probe into Satyam. The final report would need a visit to Hyderabad soon and a deeper study of issues like corporate governance, non-adherence to standard accounting practices, role of independent directors and other stakeholders in the Satyam Computers case.

Maytas incurs loss

Maytas Infra Limited (Maytas), an arm of the scam ridden Satyam Computers, has posted huge loss of Rs. 489.79 crores for the year ended March 2009.

The impact of the unprecedented developments in Satyam on Maytas Infra was evident as the company reported a net loss of Rs. 489.79 crore as against a net profit of Rs. 99.64 crore in the previous year.

Turnover

The turnover itself fell by 19 per cent from Rs. 1,637 crore last year to Rs. 1,335 crore for the year ended March 31, 2009.

As on July 31 this year, the order book of the company stood at Rs. 7,332 crore although several projects entrusted to the firm were cancelled. Most notable among them, though not in the fiscal under review, was the cancellation of the prestigious multi-crore Hyderabad Metro Rail Project.

(courtesy:www.Thehindu.com, Date:30-08-09)