The auditor of Financial Technologies — Deloitte Haskins & Sells — has said that the company’s results for the year ending March 31, 2013 should no longer be relied upon due to the crisis at group company National Spot Exchange (NSEL).
As a result, the company is deferring the passing of three items from its 25th annual general meeting on Wednesday, it said in a release to stock exchanges on Tuesday.
The items include 2012-13 audited results, dividends and re-appointment of Deloitte Haskins & Sells as its chartered accountant.
NSEL, which contributed roughly 56% to Financial Technologies’ net profit in 2012-13, is embroiled in a crisis, where it has failed to settle trades worth Rs 5,600 crore. This has led to FT Group and its promoter Jignesh Shah facing the ire of investors, regulators and the government.
Financial Technologies said its stand-alone and consolidated results for 2012-13 will be amended with a revised auditor’s report.
“The company……will satisfy the statutory auditors of the company on stand-alone financial accounts though standalone and consolidated financial statements have been audited prior to the event occurred at NSEL,” the Financial Technologies release to BSE said.
Deloitte Haskins & Sells said it would not comment on client proprietary matters.-from BS
How can an audit firm withdraw its signature from audited accounts which is in the public domain since 30 May,2013?
It is clear that Deloitte feared that is could be party to a class action suit under Clause 140 and 245 of the Company Bill 2013 and hence withdrew its signatures.
The question is:Shouldn’t ICAI get its head out of its arse and take action against Deloitte.But does it have the balls?Or will it do nothing as in the case of PWC in the Satyam case?Given the track record of ICAI, I wouldn’t be holding my breath.
The message to investors in Indian equities is clear:Believe the audited accounts at your own peril.