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SATYAM COMPUTER SERVICES SCANDAL - Term Paper Example
Finance & Accounting
Pages 4 (1004 words)
SATYAM COMPUTER SERVICES SCANDAL About Satyam Satyam Computer Services Ltd was one of the leaders in the worldwide information technology services industry. The company has effective know-how in the related industry as well as in other functional areas. The professionals working with the company has apt knowledge regarding enterprise solutions, client relationship management, product lifecycle management and business intelligence…
This scandal had a negative implication in overall global information technology industry during the trying times of credit crunch as the company used to provide its services to more than 75% of the Fortune 500 companies (Timmons & Wassener, 2009). It was on January 2009, the Chairman of the company, Mr. B. Ramalinga Raju mailed a letter to the Securities & Exchange Board of India (SEBI) as well as his Board Members confessing the fact that he had been forging the financial statements of the company. This resulted to the overstatement of the company revenues by $ 1 billion. He further mentioned that the balance sheet of the company incurred a liability of $253 million which was arranged by him personally. The revenues were overstated by 76% as well as profits by 97%. Therefore, the major offenders in the event were the Former Chairman Mr. B.Ramalinga Raju along with other several members of the board (Kripalani, 2009). Loss to Satyam During the period of such issues, the company lost its significant clients. ...