SEBI held PwC guilty, bars it from Auditing Listed Firm for two years

In a 108-page order posted on its website yesterday, the regulator for securities market in India, SEBI has imposed a ban of two years on PwC.  The order states a two years ban on entities or firms practicing as chartered accountants in India under the brand and banner of Price Waterhouse from directly or indirectly issuing any certificate of audit of listed companies, compliance of obligations of listed companies and intermediaries registered with SEBI.” However, SEBI has clarified that the order will not impact audit assignments relating to the financial year 2017-18. 

SEBI has also ordered Price Waterhouse, Bangalore and two of its erstwhile partners- S Gopalakrishnan and Srinivas Talluri to jointly forfeit wrongful gains of about Rs. 13.1 crores plus interest within 45 days.

In a statement, PwC said, “We are disappointed with the findings of the Sebi investigations and the adjudication order... we are confident of getting a stay before this order becomes effective," PwC said in a statement.”

In January 2009, B Ramalinga Raju, the then chairperson of Satyam Computers, confessed to the company’s board and stock exchanges to have overstated revenue and profit over several years in accounting fraud amounting to Rs 7,136 crore. The promoters purportedly inflated revenue, fabricated invoices, falsified accounts and income tax returns, and forged fixed deposit receipts to paint a pleasing picture of the company’s financials. SEBI was probing PwC's role as it was acting as the auditor of the company between 2000-2008.