Satyam The Tiger Of India - 2951 Words

Satyam - The Tiger of India I. Background Several years after Enron and its subsequent landmark regulation Sarbanes-Oxley, significant frauds in the corporate environment are still occurring. Throughout all of the major corporate frauds committed over the past 15 years, the underlying red flags and symptoms are the same. Internal controls are being overridden without regard, CEOs are manipulating the financial statements to meet analyst financial metrics and corporate cash coffers are being raided for personal use. Well respected audit and oversight firms are jeopardizing their reputations by consistently missing the obvious while C-level perpetrators are escaping harsh prosecution. Satyam Computer Limited is one such firm in India. The†¦show more content†¦There was such obvious and blatant fraud occurring at many levels in the firm. This paper will provide a high level overview of the types of fraud while providing a fraud audit program for a specific type of fraud. It is important to note several key factors that contribute to the corporate debauchery occurring in India. Most notably, the Indian accounting profession is self-regulated. â€Å"India, by sticking to the self-regulatory model, is set up for market failure. (livemint.com) As capitalism is to America, lack of regulation is to India with subsequent effects of corruption. Business in India, regardless of industry, is replete with corruption and bribery. Not surprisingly these nefarious ideals found their way into the corporate governance of Indian firms and filter down into the day to day business operations. License Raj, a colloquial term coined in the late 1970s, indicates a period in which to establish a business and obtain necessary operating permits, owners are required to pay bribes to government officials. ( Per Audit TEXT) Satyam experienced explosive growth and outpaced other firms in the industry from 2003-2008. According to the journal article Corporate Accounting Fraud: A Case Study of Satyam Computers Limited, Satyam realized 35% annual growth where the industry standard was 6.4%. The article also indicated Satyam had 40% earnings-per-share growth and