Click thumbnail to view original, then click again to view full size. The text is worth a closer look.
What a tragic irony!
In case you haven’t heard, Satyam was the fourth-largest IT outsourcing company in India, with 55,000 employees (or so they claimed). The CEO, Ramalinga Raju, recently resigned after admitting massive financial fraud. As of this writing, the company is almost out of cash.
Here we go again…
Satyam has done business with companies and governments in over 60 countries, including the U.S. This scandal appears to be even larger in scope than the Enron/Arthur Andersen scandal of late 2001. Price Waterhouse, the Indian subsidiary of PricewaterhouseCoopers, is facing close scrutiny over having signed off on Satyam’s audits.
Obviously, the much-touted Sarbanes-Oxley law enacted after the Enron/Arthur Andersen debacle did nothing to prevent the recent collapse of the U.S. real estate, stock market, and financial sector. The take-home lesson is that once any corporation becomes multinational in scope, and politically well-connected, no laws, no regulations, no bureaucratic restructuring can possibly keep it honest if its management chooses to do otherwise.
Another reason why outsourcing is wrong
Outsourcing and offshoring are always and everywhere the enemies of accountability. The further away one’s trading partners are located, the harder it is to comprehend what they are up to, and that will never change.
Why corporate cheating is contagious
Whenever one major company in an industry has been “cooking the books” to promote or exaggerate its own success, what effect do you suppose that has? Think about it! Every other executive, every other company in that industry will be pressured to match or exceed the cheater’s inflated results, by fair means or foul, or face the wrath of board members and stockholders.
Some news links and other sources:
- Business Standard: Regulators, government tighten noose around Satyam
- Business Standard: Government supersedes Satyam board
- Wikipedia: Satyam Computer Services Ltd.
- NYT: Satyam Chief Admits Huge Fraud
- IHT: India hears calls for Satyam bailout
- IHT: Auditor in cross hairs over fraud at Satyam
- The Australian: Police arrest Satyam founder, Government sacks board
- Information Week Blog: Satyam And Its 8-Year Ban from World Bank
- Bloomberg.com: Satyam U.S. Investors File Actions Alleging Fraud (Update2)
- TheDeal.com: Enron went bankrupt, but what of Satyam’s future?
Perhaps some of this would be funny if it were not so sad.
Note: The screen capture was taken by 1389AD from www.satyam.com, shortly after the announcement. The pixelated area was blurred in the original.
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6 comments ↓
this is not only about Satyam,
but there are numerous companies who show there balanced sheet fake
because as the huge amount of salary are given to employee for the name of packages as well as the huge amount of increments halfyearly or annualy according to me if the increment is limited or fixed or in some proportion i thing that more profit occurs as less inivent in manpower.
according to me more than 50% of employee in any companies are getting higher packges and increments just of only experiance not by work.
thats it thanks.
DEATH THREAT
Can anyone track this commenter down? Hopefully with an address.
http://brianakira.wordpress.com/2009/01/26/death-threat/
This blogspot profile has the same names ["HarisTiger1" & "Muhammad Haris"] and the same email:
http://www.blogger.com/profile/14510645918609355633
http://haris10730.blogspot.com/
haristiger1@gmail.com
hello…i vote for your blog on bloggers choice awards 2009.
it will be honour if you would vote for my blog too for foreign language category…success for you!
Gilang
Gigisehatbadansehat.blogspot.com
If Geert Wilders falls, then Freedom of speech is dead in Europe. We are launching an extensive International Action SITA including two possible texts ; one comparing Wilders and Winston Churchill and another Wilders and Charlie Chaplin:
http://sitamnesty.wordpress.com/
2009/01/23/i-support-democrat-geert-winston-wilders-against-islamic-fascism-and-its-dhimmis (Winston Eng)
http://sitamnesty.wordpress.com/
2009/01/23/i-support-democrat-geert-charlie-wilders-against-islamic-fascism (Charlie Eng)
To support Geert Wilders and our dearly acquired freedoms please participate to the 2 suggested actions and transmit this message to your friends owners of a website in order they publish it.
An other way to support Geert Wilders is to give some money. To donate: http://www.geertwilders.nl
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