Indian Enron
B. Ramalinga Raju, Satyam’s chairman, said the balance sheet as of Sept. 30 had inflated non-existing cash and bank balances of 50.40 billion rupees ($1.04 billion), understated a liability of 12.3 billion rupees, and overstated debtors’ position of 4.9 billion rupees.
In a letter to the board, made available to the stock exchange, Raju wrote that he was making the announcement “with deep regret, and tremendous burden that I am carrying on my conscience.”
“The gap in the balance sheet has arisen purely on account of inflated profits over a period of last several years … what started as a marginal gap between actual operating profit and the one reflected in the books of accounts continued to grow over the years,” he said.
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Saved a similar story link earlier today. That’s something isn’t it?
Actually was reading about Satyam late last night on MoneyControl.com (in a review of the Indian market action). Was wondering if it would be a big story here in the US, and I guess they found the hook (Enron) to make it so…
Comment by David — 1/7/2009 @ 9:06 pm
I don’t think it’s been a big story here yet – right now, the media has far too many other big stories to chew on: Obama, stimulus, Madoff, etc.
Comment by BMB — 1/8/2009 @ 7:57 am