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The Satyam Computers Scam

Satyam Computer Services was a large Indian IT company that grew rapidly in the late 1980s and 1990s. In 2008, its founder Ramalinga Raju confessed to a $1 billion accounting fraud, inflating profits and assets. This shocked investors and damaged confidence in India's outsourcing industry. The government and regulators launched investigations and prosecutions. Tech Mahindra later acquired Satyam and the merged company worked to rebuild trust. The Satyam scandal highlighted the need for stronger auditing practices and regulatory oversight to prevent similar frauds in the future.

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Tushar Sahu
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499 views

The Satyam Computers Scam

Satyam Computer Services was a large Indian IT company that grew rapidly in the late 1980s and 1990s. In 2008, its founder Ramalinga Raju confessed to a $1 billion accounting fraud, inflating profits and assets. This shocked investors and damaged confidence in India's outsourcing industry. The government and regulators launched investigations and prosecutions. Tech Mahindra later acquired Satyam and the merged company worked to rebuild trust. The Satyam scandal highlighted the need for stronger auditing practices and regulatory oversight to prevent similar frauds in the future.

Uploaded by

Tushar Sahu
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PPTX, PDF, TXT or read online on Scribd
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THE SATYAM

COMPUTERS SCAM
GROUP :
ABOUT THE COMPANY
• Satyam computer services limited was founded in 1987
• IT based company located in Hyderabad
• Started with 20 employees
• 1991: listed in BSE , NSE
• First Indian company to be listed in 3 international exchanges
NYSE, DOWJONES, EURONEXT
• Satyam’s network covers 66 countries and 53000 employees
across six continents
The beginning of the great fall

• The boom in the real estate attracted Ramalinga Raju to invest in


real estate
• He started MAYTAS infrastructure and properties
• Manipulated the financial statements of Satyam computers
• Fake balance sheets and invoice bills
• Actual 60crore – fake 600crore
• Which made rise in the share prices
• profits from the share market has been reinvested in MYTAS
OUT-BROKE OF THE SCAM

•He planned to buy the shares of the MYTAS in order to fill the
GAP
•Disagreement of investors
•The share price has been drastically decreased
•The Price Waterhouse and coopers the auditors of Satyam
companies failed their job terribly
•Which made him confess the truth
•“It was like riding a tiger without knowing how to get down
without being eaten”
IMMEDIATE MARKET REACTION
OVERALL IMPACT ON MARKET
Government actions
• CBI took the case and started investigation
• Sentenced to prison
• Huge sum of penalty imposed
• SEBI took various steps to tighten the grip on such perpetrators in
future
• Bought new regulations under the companies act 2013
• Companies are obligated to change their auditors every 10 years
• New board of directors appointed
Multimedia
AFTER THE SCAM
• Tech Mahindra acquired Satyam by purchasing 46% stake on April
13,2009
• On July 2009, Satyam rebranded its services under the new
Mahindra management as “Mahindra Satyam”
• The board of tech Mahindra and Mahindra Satyam approved the
merger on march 21, 2012
• The board of the new tech Mahindra new CEO and MD Vineeth
Nayyar was appointed as the vice chairman
CONCLUSION

More scandals like Satyam can be avoided


• if auditing firm is honest
• SEBI place an active role
• Periodic review of legal compliance report by independent
directors
THANK YOU

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