Corporate Accounting Fraud: A Case Study of Satyam Computers Limited

Open Journal of Accounting, 2013, 2, 26-38

13 Pages Posted: 20 Oct 2015

Date Written: October 20, 2015


From Enron, WorldCom and Satyam, it appears that corporate accounting fraud is a major problem that is increasing both in its frequency and severity. Research evidence has shown that growing number of frauds have undermined the integrity of financial reports, contributed to substantial economic losses, and eroded investors’ confidence regarding the usefulness and reliability of financial statements. The increasing rate of white-collar crimes demands stiff penalties, exemplary punishments, and effective enforcement of law with the right spirit. An attempt is made to examine and analyze in-depth the Satyam Computer’s “creative-accounting” scandal, which brought to limelight the importance of “ethics and corporate governance” (CG). The fraud committed by the founders of Satyam in 2009, is a testament to the fact that “the science of conduct is swayed in large by human greed, ambition, and hunger for power, money, fame and glory”. Unlike Enron, which sank due to “agency” problem, Satyam was brought to its knee due to ‘tunneling’ effect. The Satyam scandal highlights the importance of securities laws and CG in ‘emerging’ markets. Indeed, Satyam fraud “spurred the government of India to tighten the CG norms to prevent recurrence of similar frauds in future”. Thus, major financial reporting frauds need to be studied for “lessons-learned” and “strategies-to-follow” to reduce the incidents of such frauds in the future.

Keywords: Corporate Accounting Frauds; Satyam Computers; Case Study; India; Corporate Governance; Accounting and Auditing Standards

Suggested Citation

Bhasin, Madan Lal, Corporate Accounting Fraud: A Case Study of Satyam Computers Limited (October 20, 2015). Open Journal of Accounting, 2013, 2, 26-38, Available at SSRN:

Madan Lal Bhasin (Contact Author)

Universiti Utara Malaysia ( email )

Sintok, Kedah Darul Aman 06010
01114567247 (Phone)


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