Hyderabad: Local media in Hyderabad was abuzz with the news of searches being carried out by CID at the PricewaterhouseCoopers office. But clearly, this is now going to be routine until there is clarity on their role.
In a statement, the firm said, ",We are in discussion with different agencies for providing information requested by them. We are fully cooperating with the agencies and providing whatever information or documents or materials that have been asked for.",
The audit firm is also getting its line of defence ready and has already roped in a leading Mumbai-based law firm J Sagar to defend them.
So for now, it is just sharing as many documents as they have. But the legal line it plans to take is how they went by documents supplied by Satyam, which incidentally were reconciled with banks. And PwC was convinced that the money was actually parked in the banks.
But does that mean that PwC will argue from the documentary evidence they have from the bank certificates that Raju may have siphoned off the money just after the audit was completed, which is after September 30, and so they cannot be held accountable for that?
But others don't buy that line entirely.
",Yes money can be taken out but still, look at the scale, look at the timeline. As an external auditor, you are representing too many stakeholders to take anything at face value,", said Kumkum Sen, Partner, Rajinder Narain and Co.
There is also enough doubt on what role did the internal audit system of Satyam played since their team with 60 members was large enough and had won awards.
Sources tell NDTV that it will be unfair to single out PwC unless every document was forged and the auditors never got a whiff of it.
",Under the companies act, there is nothing specified which is directed towards the internal auditor. But having said that, like the external auditors, the internal auditors should also stand in the same footing. Shareholders can take action against internal auditors for gross negligence or willful default or fraud,", said Akhil Hirani, Managing Partner, Majmudar and Company.
But the bigger worry for PwC should not be what happens in India but what unfolds in the United States with a class action lawsuit in process. Even if they manage to convince the Indian lawmakers, the challenge of fighting of an American legal system will certainly be much tougher.