India begins debate over future of audit after Satyam

India begins debate over future of audit after Satyam

Calls for partner rotation and beefed up disciplinary process

The debate over the future of audit in India after the Satyam scandal has
begun in earnest with a senior member of the country’s profession calling for
change.

KS Mehta, managing partner of
SS Kothari Mehta
and Co
, one of the largest mid-tier firms, has written in the country’s
business daily asking for a review of auditor rotation, the introduction of
partner rotation and a new system for inspecting auditors by the Institute of
Chartered Accountants of India.

Mehta also claims the Indian profession needs a strengthened disciplinary
process and a special system for high value cases like Satyam.

Mehta writes: ‘The Satyam affair has shaken the country’s audit profession
and regulatory authorities to its roots. Investors have suffered in a big way
and Indian business has lost some of its sheen.’Satyam’s former chairman
Ramalinga Raju admitted in a letter last month that an accounting fraud worth as
much as $1bn had been committed at the IT giant.

Auditors from PricewaterhouseCoopers have been questioned by the police and
the professional authorities in India.

Read Mehta’s views in their entirety
here.

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