Thursday January 8, 02:38 PM
Fraud-hit Indian IT firm vows to fight on
MUMBAI (AFP) - Bosses at Indian outsourcing giant Satyam Computers vowed Thursday that the company would remain in operation despite being rocked by revelations of a billion-dollar accounting fraud.
Interim chief executive Ram Mynampati said he and senior colleagues were shocked at disclosures made by founder-chairman B. Ramalinga Raju that company accounts and assets had been falsified and profits inflated.
But he insisted that neither he nor other board members knew of the scam, which has also prompted the company's managing director and chief finance officer to tender their resignations.
"We are shocked at the disclosures. Our aim is to ensure that the business continues," he told a packed news conference at Satyam's Hyderabad headquarters.
An internal probe was now under way into the "accuracy and legality" of Raju's statement and a full assessment of the actual finances of the company, which is India's fourth-largest software exporter, he added.
Staff had been paid wages for December but Mynampati could not say whether there were funds to cover January as the liquidity position of the company "was not healthy".
Raju, who resigned Wednesday, is currently in Hyderabad, his lawyer said, but the company has not filed a police complaint against him for fraud.
Asked why not, Mynampati said: "Our first step is to look at reality of the situation, based on Raju's statements. Once we come to a proper conclusion, we will take the most appropriate step to protect the interest of the company."
PriceWaterhouseCoopers, whose role has come under scrutiny, remained the firm's auditors, he added.
Amid concern about the company's future after stocks lost nearly 80 percent of their value, senior management had directly contacted their top 100 clients to brief them of developments, the executive said.
The company would now "evaluate all options" to improve its future and secure the posts of its estimated 53,000 staff, he added.
"The Satyam of today is different from the Satyam of yesterday. We vow to strengthen corporate governance and maintain full transparency," he added.
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