'If you take money...': Mohandas Pai, an early investor in Byju's, calls for better governance after auditor exit
Byju's has not paid enough attention to governance and releasing financial figures in time, says Pai
- Jun 23, 2023,
- Updated Jun 25, 2023 12:31 AM IST
Mohandas Pai, an early investor in edtech major Byju's, said on Friday the company has not paid enough attention to governance, a day after its auditor has resigned and reports emerged about exit of three prominent board members.
Deloitte disclosed on Thursday that it was resigning as auditor because Byju's had delayed providing financial statements for 2021-22. Deloitte, which was slated to audit Byju's until 2025, has quit with "immediate effect" mid-term, due to "long-delayed" financial statements by the company, according to the auditing firm's resignation letter filed to the regulator.
Byju's in a statement said it has appointed BDO as its new auditor, adding this will help it "uphold the highest standards of financial scrutiny and accountability".
The same day, board members representing Peak XV Partners, earlier known as Sequoia Capital India, Prosus and Chan Zuckerberg Initiative also reportedly stepped down without giving reasons.
Pai, chairman and co-founder of Aarin Capital and former CFO of IT giant Infosys, was Byju's early investor. Byju's website says Pai was among those who "have backed us and guided us" and "always believed in our vision".
"Byju's has not paid enough attention to governance and releasing financial figures in time. If you take money from any investor, you are accountable," Pai told Reuters.
Meanwhile, the firm clarified on Friday has denied the reports of an inspection by the Ministry of Corporate Affairs (MCA) over corporate governance lapses. The firm's spokesperson said that the company has not received any correspondence from the MCA regarding an inspection, and is not aware of any such inspection.
Byju's offers online tutorials for school students. It was once a darling of investors that valued it at $22 billion last year, but it has been embroiled in legal spats with lenders and sacked many employees amid a broader slowdown. This week's resignation of Deloitte and the three board members reported exit has put a spotlight on its financial management.
"Even if you are a private company, you are still accountable," Pai added.
Byju's global investors include General Atlantic, BlackRock and Qatar's sovereign wealth fund, but none of them have so far commented on the recent developments.
Demand for Byju's tutorials boomed during the Covid pandemic but has waned ever since Covid nearly ceased to exist.
Watch: Amul Girl creator Sylvester daCunha passes away, throwback to iconic Amul Ads
Mohandas Pai, an early investor in edtech major Byju's, said on Friday the company has not paid enough attention to governance, a day after its auditor has resigned and reports emerged about exit of three prominent board members.
Deloitte disclosed on Thursday that it was resigning as auditor because Byju's had delayed providing financial statements for 2021-22. Deloitte, which was slated to audit Byju's until 2025, has quit with "immediate effect" mid-term, due to "long-delayed" financial statements by the company, according to the auditing firm's resignation letter filed to the regulator.
Byju's in a statement said it has appointed BDO as its new auditor, adding this will help it "uphold the highest standards of financial scrutiny and accountability".
The same day, board members representing Peak XV Partners, earlier known as Sequoia Capital India, Prosus and Chan Zuckerberg Initiative also reportedly stepped down without giving reasons.
Pai, chairman and co-founder of Aarin Capital and former CFO of IT giant Infosys, was Byju's early investor. Byju's website says Pai was among those who "have backed us and guided us" and "always believed in our vision".
"Byju's has not paid enough attention to governance and releasing financial figures in time. If you take money from any investor, you are accountable," Pai told Reuters.
Meanwhile, the firm clarified on Friday has denied the reports of an inspection by the Ministry of Corporate Affairs (MCA) over corporate governance lapses. The firm's spokesperson said that the company has not received any correspondence from the MCA regarding an inspection, and is not aware of any such inspection.
Byju's offers online tutorials for school students. It was once a darling of investors that valued it at $22 billion last year, but it has been embroiled in legal spats with lenders and sacked many employees amid a broader slowdown. This week's resignation of Deloitte and the three board members reported exit has put a spotlight on its financial management.
"Even if you are a private company, you are still accountable," Pai added.
Byju's global investors include General Atlantic, BlackRock and Qatar's sovereign wealth fund, but none of them have so far commented on the recent developments.
Demand for Byju's tutorials boomed during the Covid pandemic but has waned ever since Covid nearly ceased to exist.
Watch: Amul Girl creator Sylvester daCunha passes away, throwback to iconic Amul Ads