BackThe week in review
The week in review
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New Delhi: The big story this week was Satyam as the new board says the company has Rs1,700 crore as receivables on its books. Company affairs minister Prem Chand Gupta said that most of Satyam’s customers are willing to stay with the company. He also appointed three new directors to the company board, taking its total strength to six.Apex industry association CII’s chief mentor Tarun Das, noted chartered accountant and a past president of the Institute of Chartered Accountants of India (ICAI), T.N. Manoharan and S. Balkrishna Mainak of LIC, a major investor in Satyam, would join Deepak Parekh, Kiran Karnik and C. Achuthan at the board.
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In a related development, the ICAI has made a host of recommendations to Sebi and the ministry of company affairs on the role of auditors. ICAI has recommended to Sebi that firms whose partners are found guilty should be debarred from being appointed auditors of listed companies.
The earnings season kicks off with Infosys and Tata Consultancy Services (TCS) declaring their third quarter results in the shadow of the Satyam scam. Infosys’s consolidated net profit went up by 14.6% at Rs1,641 crore as against Rs1,432 crore in previous quarter of FY08-09. Net profit included tax writeback of Rs62 crore. The company’s consolidated net sales rose by 6.8% to Rs5,786 crore versus Rs5,418 crore.
TCS’s net was up 7.17% at Rs1,352 crore, from Rs1261.5 crore in the previous quarter. Revenue grew 4.65% to Rs7,277 crore, which was below the 5.7% rate expected by market analysts.
And in more shocking news for the IT industry, Wipro Technologies on 12 January announced that in June 2007, the World Bank had banned it from contesting for its contracts till 2011 because the company had offered shares to the Bank’s employees during its US IPO in the year 2000.
The disclosure follows a similar ban on Satyam that World Bank had announced a few weeks ago. Wipro said that the disclosure follows World Bank’s revised disclosure policies. The company however said that the offer of shares to employees and clients was part of the Securities Exchange Commission-approved directed share program.
Truckers called off their strike unconditionally on Monday after the government said that it would set up a committee to look into their demands. The assurance came as a saving grace for the truckers as the government had earlier made it clear that it would not accept any of their demands and instead would come down on the strikers with a heavy hand.
“They want to have their leaders released so we said ok, you call off the strike and we’ll press upon the authorities to release them," says T.R. Balu.
The committee to be chaired by Transport Secretary Brahm Dutt will submit a report within eight weeks on the demands raised by the transporters.
And inflation rate continues to head southward for the tenth consecutive week and was at 5.24% for the week ended third January. This was below what most analysts expected.
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