SEBI Bans Price Waterhouse For 2 Years In Satyam Case, PW Network To Seek Stay Order

| January 11 , 2018 , 14:18 IST

Indian regulatory body SEBI (Securities and Exchange Board of India) on Wednesday banned global auditing firm Price Waterhouse Network from engaging in audit work with any listed company for a period of two years starting April 2018. SEBI announced the ban in connection with the role of Price Waterhouse (PW) in the Rs 8,000-crore Satyam scam of 2009.

SEBI has also asked PW to pay a fine of Rs 13.09 crore, combined with interest at 12 percent per annum from January 2009, amounting to around Rs 14 crore.

Former PW partners S Gopalakrishnan and Srinivas Talluri, who were responsible for the audit of Satyam at the time of the fraud, have also been barred from issuing audit certificates to listed companies for a period of 3 years.

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The order issued by SEBI stated: "Listed companies and intermediaries registered with Sebi shall not engage any audit firm forming part of the PW Network, for issuing any certificate with respect to compliance of statutory obligations which Sebi is competent to administer and enforce, under various laws for a period of two years."

The ban against Price Waterhouse would come into effect from the financial year 2018-19, without affecting the auditing work of 2017-18.

Soon after the SEBI order, Price Waterhouse Network issued a statement saying, "We are disappointed with the findings of the Sebi investigations and the adjudication order. The Sebi order relates to a fraud that took place nearly a decade ago in which we played no part and had no knowledge of."

The PW statement continued, "as we have said since 2009, there has been no intentional wrongdoing by PW firms in the unprecedented management perpetrated fraud at Satyam, nor have we seen any material evidence to the contrary. We believe that the order is also not in line with the directions of the Hon'ble Bombay High Court order of 2011 and so we are confident of getting a stay before this order becomes effective."

Price Waterhouse had moved a consent plea with SEBI in September 2017, to settle the investigations regarding its role in the Satyam scam, after SEBI rejected its former consent plea in 2009.