Government orders inspection of Byju’s account books: Report
The embattled edtech major has already been reeling from the exits of three board members and its auditor
- Jul 11, 2023,
- Updated Jul 11, 2023 4:08 PM IST
The Centre has ordered an inspection into the account books of the embattled edtech major Byju’s, said a report on Tuesday.
In June, Deloitte Haskins and Sells resigned as Byju’s auditor citing a delay in submitting financial statements. GV Ravishankar of Peak XV Partners (Sequoia Capital India), Russel Dreisenstock of Prosus, and Vivian Wu of Chan Zuckerberg Initiative also resigned from Byju’s board.
The Ministry of Corporate Affairs has sought a report in six weeks, Bloomberg reported quoting sources.
Earlier, it was reported that the Union Ministry of Corporate Affairs was planning to involve the Serious Fraud Investigation Office (SFIO) to look into the irregularities at Think and Learn Pvt. Ltd, which runs the edtech major.
The ministry has reportedly already examined the legalities and the procedures for making a reference to SFIO over the last few days.
However, the company has denied the report that the MCA has sent any communication regarding any probe into its alleged financial reporting compliance failures and governance lapses.
"I can confirm Byju's has not yet received any communication from the MCA. They have previously provided appropriate explanations and clarifications to the MCA during routine inspections. Should a routine inspection take place, Byju’s will be happy to cooperate fully and provide all necessary explanations and clarifications," said Zulfiquar Memon, Managing Partner, MZM Legal.
The government’s inspection would be a new headache for Byju’s, which is already in the midst of a crisis since December last year with its term loan B lenders. Both the parties, Byju's and the bondholders, have sued each other in different courts in the US.
Byju’s, which is valued at $22 billion in the last funding round, will restart negotiations to restructure its $1.2 billion term loan after breaching certain terms of its debt agreement.
The company has already cut thousands of jobs and is seeking to raise more than a billion dollars to tide over financial difficulties.
Last week, Byju's founder Byju Raveendran organised an extraordinary general meeting (EGM) in a bid to address ongoing company issues.
He told shareholders that the firm will be forming a Board Advisory Committee (BAC) to provide advice and guidance to the CEO on matters pertaining to the composition of the board and the governance structure suitable for Byju's.
"The BAC will serve as a working group consisting of independent directors with credible backgrounds and relevant experience from diverse corporate fields," Raveendran told shareholders.
Also read: Adani-Hindenburg case: SC allows SEBI to continue probe till Aug 14
Also Watch: Hyundai Exter vs Tata Punch vs Maruti Suzuki Fronx: Price, features, other details
The Centre has ordered an inspection into the account books of the embattled edtech major Byju’s, said a report on Tuesday.
In June, Deloitte Haskins and Sells resigned as Byju’s auditor citing a delay in submitting financial statements. GV Ravishankar of Peak XV Partners (Sequoia Capital India), Russel Dreisenstock of Prosus, and Vivian Wu of Chan Zuckerberg Initiative also resigned from Byju’s board.
The Ministry of Corporate Affairs has sought a report in six weeks, Bloomberg reported quoting sources.
Earlier, it was reported that the Union Ministry of Corporate Affairs was planning to involve the Serious Fraud Investigation Office (SFIO) to look into the irregularities at Think and Learn Pvt. Ltd, which runs the edtech major.
The ministry has reportedly already examined the legalities and the procedures for making a reference to SFIO over the last few days.
However, the company has denied the report that the MCA has sent any communication regarding any probe into its alleged financial reporting compliance failures and governance lapses.
"I can confirm Byju's has not yet received any communication from the MCA. They have previously provided appropriate explanations and clarifications to the MCA during routine inspections. Should a routine inspection take place, Byju’s will be happy to cooperate fully and provide all necessary explanations and clarifications," said Zulfiquar Memon, Managing Partner, MZM Legal.
The government’s inspection would be a new headache for Byju’s, which is already in the midst of a crisis since December last year with its term loan B lenders. Both the parties, Byju's and the bondholders, have sued each other in different courts in the US.
Byju’s, which is valued at $22 billion in the last funding round, will restart negotiations to restructure its $1.2 billion term loan after breaching certain terms of its debt agreement.
The company has already cut thousands of jobs and is seeking to raise more than a billion dollars to tide over financial difficulties.
Last week, Byju's founder Byju Raveendran organised an extraordinary general meeting (EGM) in a bid to address ongoing company issues.
He told shareholders that the firm will be forming a Board Advisory Committee (BAC) to provide advice and guidance to the CEO on matters pertaining to the composition of the board and the governance structure suitable for Byju's.
"The BAC will serve as a working group consisting of independent directors with credible backgrounds and relevant experience from diverse corporate fields," Raveendran told shareholders.
Also read: Adani-Hindenburg case: SC allows SEBI to continue probe till Aug 14
Also Watch: Hyundai Exter vs Tata Punch vs Maruti Suzuki Fronx: Price, features, other details