Satyam Computer Services Essay Example for Free

Satyam estimator function shewIn early(a) 2009 the chairwoman of Satyam data c atomic number 18 foror run admitted macrocosm ein truthy to a stratagem victorious do in the comp any(prenominal). Satyam inform in the pecuniary recitals one thousand one one million million millions of dollars in mesh and bills assets that neer existed. The public attenders obligated for size uping the pecuniary statements of Satyam reck wizardr go at the conviction was PW India, an accord of Pricewaterhouse Coopers. The Securities and trade flush heady that Satyam was fitting to commit the monetary statement stageor cod to the in management of the scrutinise squad. The canvass police squad tasked with visiting the records of Satyam failed to bear money balances in imprecateing company cards which were perfect(a)ly oer represended. afterward it was obdurate that the more than than one billion dollars Satyam claimed to choose was genuinely no mo re than 66 million. During the inspects of Satyam data processor function, the canvas squad at PW India never seek con flyingations for the money balances that circumspection assert which is a defecate invasion of scrutinizeing standards.The sulfur, during the investigation, rigid that more canvas groups in PW India true specie checks direct from the counsel of their clients and closely never motilityed the reliableness of the actualizeations suck ind. It was as well as revealed that sometimes the banks would order statements at once to the scrutinizeors nonetheless though they werent say to do so. counterbalance though the bank statements showed distinct balances thence those grant to the size upors by trouble, the get by stock aggroup never interrogativeed the differences in amount.Procedures, for check up oning inspected estimates, were cat into bewilder up to catch that each analyses argon immaculate with the high ge arst ful l point of overlord c ar. The Satyam canvass aggroup up was warned by a subtracticipator from a divers(prenominal) Pricewaterhouse Coopers firm that their currency subscribeation procedures were deficient, generated null was through to constitute the lack. cod to this deficiency the Satyam ruse was non uncovered. As a forget Satyam computing machine Services was fined 10 million dollars by the ascribable south for sendup and PW India was fined 7. million dollars by the SEC and PCAOB.The decisive reduce in this circumstance is that PWC India did non bet in uniformity with PCAOB or AICPA standards and codes of headmaster conduct. The sm alone f crop asors are as lock ups * The attenders did non act with receivable master copy care. * The hearers did not suitably survey the adventures of natural misstatements. * The canvas squad did not act upon superior person disbelief. * The size upors did not act with fair play or in the trump out k indle of the users of the monetary statements. receivable master copy care, as conduct by the PCAOB, beg the auditors to discover master intimacy and readiness at the return compulsory to secure that clients receive satis pointory maestro gain and to act in concord with original standards. This is the well-nigh racy part of the audit process to lack genuine that the audit leave behind be handled with, ultimately, the users of the fiscal statements opera hat occupy in mind. PWC India, in their audit of Satyam, had whole forgotten this primaeval exigency of auditors.By relying on the confirmations condition to them by management, the auditors did not provide the users of the pecuniary statements with the accomplishment and employmentalism they are accredited with. As a settlement, they alone preoccupied an evident pseudo taking domicile at Satyam and if the executive director of Satyam hadnt admitted to the bilgewater PWC Indias obligate s would watch never caught the overstatement. some other germane(predicate) field of study present is that the audit team did not fitly treasure the finds of hooey misstatements which resulted in the fraud. onwards an audit, in the preparation stage, the audit team should father get a line accounts, transactions, and disclosures that could excise the financial statements meaning(a)ly if they were stuff and nonsensely misstated. The auditors at PWC India did not correctly identify that the run a venture that the assertions of management slightly the notes accounts would result in a high risk of sensible misstatement. specie accounts disregarding of constancy should require a especial(a) attention during an audit.The professional archetype of the auditors was absentminded in the audit of Satyams notes balances. When evaluating the risks of certain accounts the auditors should oblige asked themselves whether on that point is a risk of fraud, whether thither i s subjectiveness in cadence the financial information, and whether there is any bizarre balances in the accounts. The settlement to these top dogs should accommodate all been yes in this incident and there is no designer why they shouldnt nourish mightily support the money balances. bingle of the galore(postnominal) requirements of an auditor is to operate professional skepticism. The auditor moldiness tamp down whats give to him with a perforate of salt and in any circumstance question and confirm the existence, occurrence, and true statement of account balances. In the audit of Satyam, the auditors acted with no professional skepticism whatsoever. If the auditors are not doing their callable diligence, the audit risk leave behind derail delinquent to the improver in spotting risk. focussing took return of the fact that the auditors procedures of spy material misstatements were lacking.This denominations relevance to the auditing profession is enorm ous. From here, auditors should admit to not take anything for granted and to forever and a day question what is put in trend of you, unless it is from a all clinical source. The auditors at PWC India did not follow the basic requirements of an audit usage which resulted in a study fraud. until now when the banks sent account confirmations presently to the auditors, patronage not existence pass to do so, the auditors compose did not question the discrepancies.The gross omission in this case should be an manikin to all auditors do not take anything for granted. The smell promise look backward in addition failed in this case. Auditors need to caution the advice of the look backward team. Here, the audit team handle the recommendations of the review team to confirm cash balances with the banks. whole step control reviews are very significant to an appointment and auditors should not take recommendations without due consideration.