Amid increasing regulatory scrutiny, the Institute of Chartered Accountants of India (ICAI) has criticized the auditors of the prominent edtech company Byju’s for what it terms as “gross negligence,” raising concerns regarding financial integrity.
Ranjeet Kumar Agarwal, the president of ICAI, publicly expressed the institution’s disapproval of the auditing practices employed by Byju’s auditors during a recent event.
This criticism follows the resignation of Deloitte Haskins and Sells, Byju’s statutory auditor, in June 2023 due to delays in presenting financial statements for the fiscal year 2022. Subsequently, BDO’s audit arm MSKA & Associates took over the auditing responsibilities.
However, ICAI’s scrutiny has unearthed significant irregularities, prompting an extensive three-tier review process.
Agarwal stressed that ICAI’s disciplinary committee would thoroughly examine the conduct of Byju’s auditors, potentially resulting in punitive actions.
In an effort to assuage concerns regarding financial accountability, Byju’s released its audited financial statements for the fiscal year 2022 in February. These statements revealed a substantial consolidated net loss of Rs 8,245 crore ($994 million) alongside revenue of Rs 5,015 crore ($605 million).
This disclosure further exacerbated apprehensions regarding the company’s financial stability and governance practices.
Meanwhile, Byju’s shareholders unanimously voted to remove founder and CEO Byju Raveendran and his family members from the board in February, alleging mismanagement, as reported by NDTV Profit.
However, Byju’s has contested the validity of the voting process, dismissing it as “invalid and ineffective,” contributing to the ongoing turmoil surrounding the company’s leadership and corporate governance.
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