PwC suffers Satyam setback
Regulator rejects auditor's offer
PricewaterhouseCoopers has taken yet another knock in the $1bn Satyam
Computer Services scandal. India’s stock market regulator, the Securities and
Exchange Board of India (SEBI) has rejected an application from the firm’s India
branch to settle potential administrative or civil proceedings arising from the
case.
This ‘consent process’ order application by Price Waterhouse (PW), the India
name for PWC, can head off legal action brought by the regulator against parties
who may ‘prima facie’ be found to have violated laws, excluding a determination
that a violation had occurred in the first place.
But a PW spokesman told Accountancy Age: “We can confirm that we
have received a communication from SEBI with regard to the consent process
relating to the audit of Satyam. We remain in contact with SEBI regarding this
matter and are currently considering next steps, including the possibility of
filing another consent application.”
When its first application was filed in October 2009, the firm said that
“rather than engage in potentially long-drawn out legal proceedings with SEBI,
PW feels that it would be better for all parties to explore, without prejudice,
the settlement of proceedings initiated by SEBI.” It had added for good measure
that “the pursuit of a potential settlement is not in any way an acknowledgment
by PW that there was any wrongdoing by PW in relation to the audit of Satyam.”
SEBI had earlier issued a ‘show cause notice’ to PW (in March 2009) as part of
its investigation into Satyam.
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