This refers to Prime Minister Manmohan Singh’s statement that Satyam represents a big blot on India Inc’s image. The PM’s statement is in keeping with other statements made by the media in the aftermath of the scam — namely, can India Inc’s balance sheets be trusted, that all auditors are crooks, that all companies whose accounts have been audited by Price Waterhouse will have to re-state them, etc. It is good that we are shocked by Satyam and are trying to clean up matters by getting the SFIO in and putting pressure on ICAI to take stringent action against the auditor.
But let us not over-react. Enron and Arthur Andersen were US firms, the financial crisis we are in today is primarily a US one, the credit-rating firms who have done all of us in are primarily US ones, the list goes on. Yet, no one in the US is going around questioning the accounts of all US corporations, no one is saying that foreign investors have lost faith in US corporations.
Events such as Satyam, like Andersen and Enron, shake everyone’s faith. But what matters is how fast the system steps in to take corrective action. This is what the PM needs to focus on.
Anil Arora, Mumbai
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