Satyam Computer fraud now estimated at $1.75 billion

HYDERABAD - Financial irregularities perpetrated by the original promoters of Satyam Computer Services led by B. Ramalinga Raju resulted in a Rs.78.55 billion ($1.75 billion) impact on the company’s accounts, the stock exchanges were informed Wednesday.

Presenting the consolidated financial results of the company, now renamed Mahindra Satyam, the new management said an impact of Rs.67.95 billion ($1.5 billion) was on account of what it said was based on specific financial irregularities identified during forensic investigations.

The fictitious revenue was recorded by creation of false invoices by circumventing the normal revenue recognition cycle, said the filing signed by Chairman Vineet Nayyar on behalf of the new board of the company.

The irregularities covered various heads including revenue, interest income, exchange fluctuations, salary costs, other expenses, bank borrowings and interest, as also tax payments, as per the report presented to the stock exchanges.

Once the poster boy of Indian information technology industry, Raju had stunned the corporate world in January last year when he admitted to financial irregularities worth Rs.70 billion ($1.5 billion) over the past several years in the largest corporate fraud in the country’s history.