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Wednesday, January 07, 2009

Ramalinga Raju and The Satyam Scam


 
 
Today's sensational news in the Indian IT industry and the Indian Share market is the resignation of Ramalinga Raju from the Chairman post of Satyam Computers.

The Satyam shares which were already going down (after the World Bank ban), fell tremendously after this news. The price of a share in the morning was about Rs. 180/- and in the evening its just above Rs 35/-

In his resignation letter to the board, Ramalinga Raju had admitted that the Satyam's balance sheets was inflated to Rs. 5040 crores, which was actually very less.

The letter says, how all the attempts to fill this fictitious assets with real ones failed and then comes the punch line - According to Raju, none of the other Board Members had the knowledge of the real situation.

Poor Raju. In every board, whenever a problem comes, there will be one scape goat and in this issue, its Ramalinga Raju. Even without any SEBI/CBI interrogation, Raju have come out himself, admitting his faults - (though there was no other gentleman option for him). Not many in our country have this courage. In that aspect, Raju is a gentle man.

If at all that Maytas acquisition had happened smoothly, Satyam wouldn't be in this bad condition.

by the way, I can surely tell Satyam is not the only company with this problem. If SEBI audits all company's books - there will be many more Satyams. Even bigger ones might exist.


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7 Comments:

Anonymous Anonymous said...

Satyam is not the first or the last Indain IT company to have cooked its books. Most South India based IT companies like DSQ, Pentafour etc have done this in the past. In my mind, Raju is an economic terrorist - no different from Kasav whose actions brought the market to its knees just as Raju's did. Point is who were the accomplices of Raju? A heist of this magnitude could not have been pulled off without the support of the government apparatus including DCA, ROC, Income Tax etc. And at the back end of it all, there would surely be some Andhra politicians who all of us know.

4:51 AM  
Blogger Vetty Officer said...

@Anonymous Guest
//A heist of this magnitude could not have been pulled off without the support of the government apparatus including DCA, ROC, Income Tax etc.

You are right. There are lot more people behind this scam. What were those highly paid company auditors and senior executives doing then?

5:32 AM  
Blogger Vetty Officer said...

The real sad people are the 50000+ employees of Satyam. Most of them will be in panic now. A merger might settle things for them.

5:38 AM  
Blogger Ela said...

"Not many in our country have this courage. In that aspect, Raju is a gentle man."

Yeap I agree that to admit one's mistake takes quite a lot of courage but the question is do we really need such gentlemen around who first knowingly mess up and then admit it knowing that his life is not going to be messed up entirely?!

5:53 AM  
Blogger Vetty Officer said...

@Ela

I m not saying Raju is innocent. Since he had taken all the blame on himself - I felt he's a gentleman among the group of culprits there.

---

Here's a good blog post on this by an auditor

1:04 AM  
Anonymous Anonymous said...

Legend is Legend.

Raju.

There are many people who survived under satyam till now.
Something went wrong(we know what it is) but no one is having right to Point Raju. He's always a Legend and a Hero...

1:27 AM  
Blogger Ela said...

Thanks for the link...it was an interesting read!

1:31 PM  

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