Deepi malhotra 3
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satyam project

satyam project

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Deepi malhotra 3 Deepi malhotra 3 Presentation Transcript

  • CORPORATE GOVERNANCE FAILURE AT SATYAM
  • what is corporate goverance ?
  • Corporate governance is typically perceived as dealing with problem that results from the separation of leadership and control. View slide
  • DEFINITION View slide
  • Coporate governance may be defined as holding a balance between economic and social goals and between individual and commercial goals. A good corporate governance is one where a firm commits and s encompassing employee, customer, venders, and shareholders in both good and bed times.
  • Dr. B. RAMALING A RAJU
  • Satyam computer services limited .
  • INDRODUCTION
  •  Satyam computers services ltd.was founded on 27 june 1987 the company offers information technology (IT) services spanning various sectors, and is listed on the New York Stock Exchange and Euronext.
  •  Satyam’s network covers 67 countries across six continents. The company employees 50,000 to 53,000.  IT professionals across devlopment centers in India, the United States, the United Kingdom, the United Arab Emirates, Canada, Hungary, Singapore, Australia and many more.  It serves over 654 global companies, 185 of which are fortune 500 corporations.
  • Management-Boards Executives Directors : . B. Ramalinga Raju (Founder& Chairman)  Mr. B. Rama Raju (CoFounder& Ceo)
  • Non-Executives Directors :Mr. V.P. Rama Rao, IAS (Retd.) Dr. (Mrs.) Mangalam Srinivasan Prof. Krishna G. Palepu Mr. Vinod Dham
  • Few milestones
  •  1987 (Incorporated as private limited company in 1987)  1991 (Recognized as a public limited company; debuts on the Bombay Stock Exchange (BSE) ) (IPO oversubscribed by 17 times.)  1993 ( Satyam signs joint venture with Dun & Bradstreet for IT services.) (Joint venture with GE announced.) • 1999 (Satyam Infoway (sify) becomes the first indian internet company listed on (NASDAQ) )
  •  ( Satyam forms joint venture with TRW Inc.) (Presence established in 30 countries.) • 2007 (Becomes the official IT services provider for the FIFA world cup. • Announces acquisition of UK-based nitor global solutions limited. • Becomes the first asian company to feature in the training magazine’s list of top 125 companies for learning.
  • SATYAM CASE IMPROTANCE
  • • Satyam scam was not any easy issue. It has its own complexities as it involved 14000 crore scam. • Satyam scam had been the example for following poor governance practices. • It had failed to show good relation with the share holders and employees. • So as to throw a light on the poor governance practice at one of the major IT giants, the need to study such case is model, it could be suggested that there is a need to frame up good governance rules and see to the proper implemantation of it.
  • CONDITION OF SATYAM SHARE
  • ABOUT SATYAM CONSULTANCY LTD.
  • Mr. Ramalinga Raju, CEO at the time of the scam was Mr. Ram Mynampati and CFO was Mr. Valdamani Srinivas. Satyam computer services limited has its headquarter at hyderabad. Satyam computer services ltd has several subsidiaries : A. Satyam BPO B. Citisoft C. C A Satyam D. STI E. Bridge Consultancy
  • SATYAM SCAM DETAILS
  • MAYTA S INFRA
  •  In mid-december 2008, satyam announced acquisition of two companies- Maytas properties and Maytas Infrastructure. Owned by the family members of satyam’s Founder and Chairman.  It planned to acquire 100% and 50% stakes in Maytas Property and Infra. $ 1.6 B.  Due to adverse reaction from institutional investors and the stock markets, the deal was withdrawn with in 12 hrs.
  • What went wrong ?
  •  Inflated figures for cash and bank balances of INR 5,040cr. (as against INR 5,361cr. Reflected in the books.)  Operating profit were artificially boosted from the actual 61cr. To 649cr.  Satyam also showed an interest earning of Rs. 376 cr. That was fictitious.  An over stated debtoursposition of Rs.2651 reflected in the books.
  • Slippery slope to disaster
  •  Dec’08 brought news of pending litisgation by a former client, online mobile-payment service unpaid systems which field a case of intellectual fraud and forgery against satyam in 2008.  On dec. 16, when raju announced the company would spend $ 1.6 billion to buy Maytas only to reverse the decision a few hours later under share holder pressure.
  • SATYAM’S SECRET BANK OFFICE MAYTAS
  •  It is not a mere co-incidence that maytas is satyam spelt in reverse way.  Maytas is actually run by satyam family. It include maytas properties & maytas infra ltd.  Maytas was a 2 decade old company. It had been doing remarkably well in the past 6-7 years and projects worth billions were riding upon them.
  • ACQUISITION BY MAHINDRA GROUP
  •  All well that’s end well.  Anand Mahindra- New Owner of Satyam.  Post Rs.2890 crore as takeover.  On 13th Apr 2009, VIA formal public auction process, 46% stake in satyam was purchase by Mahindra.  July 2009, satyam Rebranded its service as “MAHINDRA SATYAM”.
  • CONCLUSION
  • If auditing firm is honest. SEBI plays an active role. Periodic review of legal compliance reports by independent directors.
  • Submit By :Group Iv Khushboo Goyal Prally Jha Astha Gubrele Jyoti Sahu Shiva Rajpoot Deepika Malhotra Submit To :Dr.Vandhana Bharti Mam.
  • THANK YOU