[rohit.r6]

Lets see this with another perspective
What has gone wrong with Satyam that the Indian IT industry has woken up and taking note of?

I'll say it’s the manipulation done by of one IT family which has suddenly brought to fore the revenues earned by IT companies. This family was not alone and it was helped and guided by one of the best known audit firms in the world-PWC.

As per initial reports, it is said that the Raju family fudged the records to show non existent profits and liquidity in Satyam(it is still not proved that they have siphoned of the said amount- a staggering 7000 crores out of Satyam).Also, it is being rumored that the headcount of employees has been inflated to show the growth of the organization

This practice has been running since quite some time in Satyam. As per Mr. Raju’s confession, they have been inflating revenues, profits, headcount, etc to increase business, credibility and a lot of other things. This practice suddenly seems to have gone all wrong and the gap in actual numbers and inflated ones started increasing.

To get everything back to normal, Mr. Raju initiated the proceedings to buyout Maytas which was a sister concern. It is logical that Satyam would get a majority stake of Maytas for Satyam, the inflated amount goes into buying the stake and everything returns to normalcy. But investors did not like the idea of getting Maytas onboard and the whole thing failed.

Now, if you compare this with a number of companies going bankrupt this year, only one thing seems to have gone wrong in this case. They had a tinkerer sitting right up there. It hurts the company not the industry. No client of Satyam has been affected drastically by this fraud coming out in the open. To an extent, Satyam is continuing to do business with their clients who are standing by in times of need for Satyam.

Credibility of a company or an industry is questioned only when the company cheats its clients or employees. In this case investors have been affected; but majority of the loss is due to the large scale selling of holdings by institutional investors.


Just gave the above brief so that puys get to know whats wrong with Satyam. Let me know if I have misquoted some point. Thought that the above summary can be used as an introduction to the topic and from here we can take the discussion ahead.

[ritdudeamit]

Originally Posted by rohit.r6

Lets see this with another perspective
What has gone wrong with Satyam that the Indian IT industry has woken up and taking note of?

I'll say it’s the manipulation done by of one IT family which has suddenly brought to fore the revenues earned by IT companies. This family was not alone and it was helped and guided by one of the best known audit firms in the world-PWC.

As per initial reports, it is said that the Raju family fudged the records to show non existent profits and liquidity in Satyam(it is still not proved that they have siphoned of the said amount- a staggering 7000 crores out of Satyam).Also, it is being rumored that the headcount of employees has been inflated to show the growth of the organization

This practice has been running since quite some time in Satyam. As per Mr. Raju’s confession, they have been inflating revenues, profits, headcount, etc to increase business, credibility and a lot of other things. This practice suddenly seems to have gone all wrong and the gap in actual numbers and inflated ones started increasing.

To get everything back to normal, Mr. Raju initiated the proceedings to buyout Maytas which was a sister concern. It is logical that Satyam would get a majority stake of Maytas for Satyam, the inflated amount goes into buying the stake and everything returns to normalcy. But investors did not like the idea of getting Maytas onboard and the whole thing failed.

Now, if you compare this with a number of companies going bankrupt this year, only one thing seems to have gone wrong in this case. They had a tinkerer sitting right up there. It hurts the company not the industry. No client of Satyam has been affected drastically by this fraud coming out in the open. To an extent, Satyam is continuing to do business with their clients who are standing by in times of need for Satyam.

Credibility of a company or an industry is questioned only when the company cheats its clients or employees. In this case investors have been affected; but majority of the loss is due to the large scale selling of holdings by institutional investors.


Just gave the above brief so that puys get to know whats wrong with Satyam. Let me know if I have misquoted some point. Thought that the above summary can be used as an introduction to the topic and from here we can take the discussion ahead.

Correct Rohit,If u see ur previous post ...I have stated d same .The client base is not affected .Now lets discuss who got affected then ?

Satyam currently has 53,000 employess and they draw a salary of around 500 crores per month .Now since all the bank accounts of SATYAM are frozen and they do not have any cash reserves it's going to be very difficult to release the salary for this month and for consecutive months.

What happens then?The employess start floating their resumes !! They start speculating ...They start commenting based on their perception ..

All this add up to work against the image of SATYAM .

[cuteamita]

Originally Posted by rohit.r6

Lets see this with another perspective
What has gone wrong with Satyam that the Indian IT industry has woken up and taking note of?

I'll say it’s the manipulation done by of one IT family which has suddenly brought to fore the revenues earned by IT companies. This family was not alone and it was helped and guided by one of the best known audit firms in the world-PWC.

As per initial reports, it is said that the Raju family fudged the records to show non existent profits and liquidity in Satyam(it is still not proved that they have siphoned of the said amount- a staggering 7000 crores out of Satyam).Also, it is being rumored that the headcount of employees has been inflated to show the growth of the organization

This practice has been running since quite some time in Satyam. As per Mr. Raju’s confession, they have been inflating revenues, profits, headcount, etc to increase business, credibility and a lot of other things. This practice suddenly seems to have gone all wrong and the gap in actual numbers and inflated ones started increasing.

To get everything back to normal, Mr. Raju initiated the proceedings to buyout Maytas which was a sister concern. It is logical that Satyam would get a majority stake of Maytas for Satyam, the inflated amount goes into buying the stake and everything returns to normalcy. But investors did not like the idea of getting Maytas onboard and the whole thing failed.

Now, if you compare this with a number of companies going bankrupt this year, only one thing seems to have gone wrong in this case. They had a tinkerer sitting right up there. It hurts the company not the industry. No client of Satyam has been affected drastically by this fraud coming out in the open. To an extent, Satyam is continuing to do business with their clients who are standing by in times of need for Satyam.

Credibility of a company or an industry is questioned only when the company cheats its clients or employees. In this case investors have been affected; but majority of the loss is due to the large scale selling of holdings by institutional investors.


Just gave the above brief so that puys get to know whats wrong with Satyam. Let me know if I have misquoted some point. Thought that the above summary can be used as an introduction to the topic and from here we can take the discussion ahead.

I have one more point....
i think that Satyam scam will somewhat affect the credibility as of now foreign investers will think up twice before investing in Indian company but now companies will have to be sure while stating their headcounts,profits,revenue n have to have documents to show proofs so that any client can have satisfaction that yes the company is a good one!!! also if in any case company fails to complete projects on deadline then they again have to have proper reasons with proofs so that their goodwill is not affected!!!

[kewlankit]

frnds its gud discussin on general topics
bt koi idea ki ye technical topics(cloud computin) zyada toh nahi aate g.d may
nd topics lyk dese jisko jo bhi kahi se info mile plzz post karo
so dat v gain little bit idea abt dese topics
v cnt do g.d on dese topics cz zyada idea nahi hota abt dese
bt still cn gain knwledge
hai na..........

[rohit.r6]

Originally Posted by cuteamita

I have one more point....
i think that Satyam scam will somewhat affect the credibility as of now foreign investers will think up twice before investing in Indian company but now companies will have to be sure while stating their headcounts,profits,revenue n have to have documents to show proofs so that any client can have satisfaction that yes the company is a good one!!! also if in any case company fails to complete projects on deadline then they again have to have proper reasons with proofs so that their goodwill is not affected!!!

showing proofs as headcounts can always be fudged....you take in an employee and add him to the address book and when he quits dont flag him as 'resigned'......it seems thats wat satyam has done....they people on board who have already quit the company....only auditors come to know of this practice by looking into the number of salary accounts serviced by satyam.....and if the auditors are also in the know of things.....no investor would come to know about it.

If we cross check with other IT companies performance over the last 2 months, you will see that there has been a decrease in share prices; all due to an emotional round of selling by investors....when one sells some else buys it.....if the credibility would have gone for IT comapnies.....leve other comapnies; even if for Satyam...then you would have no buyers at all....there still is heavy buyinin satyam and people are mopre than happy to do the same @ rock bottom prices.

regarding project completion.....delays do ocur in rojects...reasons are many....maybe incase of satyam, delays would be due to the current situation.

government has taken steps to avoid the same....by appointing hdfc chairman, deepak parekh...it has initiated the proceedings for restoring credibility on satyam....having the head of a sound financial institution at the helm of satyam will restore the lost confidence of investors on satyam

[ritdudeamit]

Originally Posted by rohit.r6

showing proofs as headcounts can always be fudged....you take in an employee and add him to the address book and when he quits dont flag him as 'resigned'......it seems thats wat satyam has done....they people on board who have already quit the company....only auditors come to know of this practice by looking into the number of salary accounts serviced by satyam.....and if the auditors are also in the know of things.....no investor would come to know about it.

If we cross check with other IT companies performance over the last 2 months, you will see that there has been a decrease in share prices; all due to an emotional round of selling by investors....when one sells some else buys it.....if the credibility would have gone for IT comapnies.....leve other comapnies; even if for Satyam...then you would have no buyers at all....there still is heavy buyinin satyam and people are mopre than happy to do the same @ rock bottom prices.

regarding project completion.....delays do ocur in rojects...reasons are many....maybe incase of satyam, delays would be due to the current situation.

government has taken steps to avoid the same....by appointing hdfc chairman, deepak parekh...it has initiated the proceedings for restoring credibility on satyam....having the head of a sound financial institution at the helm of satyam will restore the lost confidence of investors on satyam

Lets disucss some other points which can throw some light on the credibility issues .
Pricewaterhouse Cooper the auditing firm which audited SATYAM is under the scanner.The firm is being quetioned for the discrepancy in the figures.

Now SATYAM is being taken to task for either bribing the auditing firm /persuading the auditors .In both the cases the image of SATYAM is defamed....

What say puys?

Thanks
Amit
Fellow Aspirant

[cuteamita]

Originally Posted by rohit.r6

showing proofs as headcounts can always be fudged....you take in an employee and add him to the address book and when he quits dont flag him as 'resigned'......it seems thats wat satyam has done....they people on board who have already quit the company....only auditors come to know of this practice by looking into the number of salary accounts serviced by satyam.....and if the auditors are also in the know of things.....no investor would come to know about it.

If we cross check with other IT companies performance over the last 2 months, you will see that there has been a decrease in share prices; all due to an emotional round of selling by investors....when one sells some else buys it.....if the credibility would have gone for IT comapnies.....leve other comapnies; even if for Satyam...then you would have no buyers at all....there still is heavy buyinin satyam and people are mopre than happy to do the same @ rock bottom prices.

regarding project completion.....delays do ocur in rojects...reasons are many....maybe incase of satyam, delays would be due to the current situation.

government has taken steps to avoid the same....by appointing hdfc chairman, deepak parekh...it has initiated the proceedings for restoring credibility on satyam....having the head of a sound financial institution at the helm of satyam will restore the lost confidence of investors on satyam

In case of satyam..Person like raju...have done fraud for his personal gaoin not for company gain as it has been revealed that he has done fraud with andhra corp of rs 52 lakh..also his statement that only he is knowing about detoriating financial condition proved contradicting as 4 senior offcials sold their shares of company in huge quantity before raju"s confession!!! so i think Satyam as a whole company should not be questioned while Mr. Raju should be questioned??? persons like him losse credibility!!!
On the other side to overcome problem Satyam has hirred two new auditning companies KPMG & deolite so that whole audit of last years can be checked!! Also govt is seeking to overcome crises rather than thinking of shutting the company...so i think steps of govt will help to addd on credibility on IT companies!!!!!

[poojadatta]

My take on this would be
1) What satyam did was to save company but to extent what they did was really wrong.
2) All this will put FII to look at india’s corporate with a eye of doubt.
3) This has at least warned other top corporate that if they do any such manipulation they will be under rigorous scrutinizer, which is in fact good as all will be alert from now before even thinking of doing something like this
4) Satyam is defamed but not divested as now as the new directors are formed it can be back in game but they need to work hard and has to be transparent in what they do.
5) When Mr. Raju said that it was his and his brother only who was responsible in this case, raise a doubt if CFO, auditors were not aware of what was happening. So again auditors are under eye of suspect.
From all this we can say that Indian company to some extent will be looked with an eye of suspension for sometime till we prove that just one company does not represent whole India. This will happen only if there is proper justice done to what has happened.
Regarding PWC yes thats another defamation providing not just to satyam but to corporate world. So here come the trust breach, many service sector are based on trust and if thats violated I have an doubt which country will trust us. Still they say lot of hidden facts are yet to be discovered behind this, so now it makes me wonder what will be next to come in this aspect and how much will it affect our industry.

To be back in game I think “Transparency” is the only way out.

What say puys?

[study_hard]

Originally Posted by kewlankit

frnds its gud discussin on general topics
bt koi idea ki ye technical topics(cloud computin) zyada toh nahi aate g.d may
nd topics lyk dese jisko jo bhi kahi se info mile plzz post karo
so dat v gain little bit idea abt dese topics
v cnt do g.d on dese topics cz zyada idea nahi hota abt dese
bt still cn gain knwledge
hai na..........

Yes I didn't post that one as a GD topic. Was more of a PI topic. They might ask us about the emerging technologies. Puys if you come around such terms do post them here.

[rohit.r6]

Originally Posted by ritdudeamit

Lets disucss some other points which can throw some light on the credibility issues .
Pricewaterhouse Cooper the auditing firm which audited SATYAM is under the scanner.The firm is being quetioned for the discrepancy in the figures.

Now SATYAM is being taken to task for either bribing the auditing firm /persuading the auditors .In both the cases the image of SATYAM is defamed....

What say puys?

Thanks
Amit
Fellow Aspirant

and waht if PWC has overlooked the whole fudging......what if PWC has audited only things the accounts that were given by Satyam....thats a case of gross negligence by PWC

and such things do happen...being in the finance industry.....i hv seen instances where auditors audit only wahtever is presented to them....they dont take pains to go to the root of the problem...and they dont question a lot fearing tht they may lose the client...such instances do happen

so its a case of fudging at the highest level without the auditors coming to know about it.....and even if they do come to know...they keep mum about it