AdminInvestigators, regulators and stakeholders of fraud-hit Satyam Computer Services attribute auditor’s failure in detecting the fraud to either negligence, incompetence or blatant connivance with the promoters who cooked books for years. Ideally, auditors, who accept hefty fee, should ensure that they independently verify all documents they rely on before certifying the financial statements of a company as a ‘true and fair’ account of its financial health.
The auditing norms require auditors to write to a bank where deposits are held and get a reply at their address, said Ved Jain, president, Institute of Chartered Accountants of India (ICAI), the body that regulates the profession of chartered accountants in India.
However, how deep an auditor should go in his work of verifying the accounts of a company with several subsidiaries and giving his opinion about its financial health within a fortnight remain a debatable issue and is likely to get a greater regulatory attention in the coming days.
“People cheat their wives without they ever suspecting. Systematic fraud by senior management and suicide bombings are two things impossible to prevent,
