Satyam Computer Scam – Pre and Post Diagnosis

International Journal of Marketing & Financial Management, Volume 4, Issue 9, Dec-2016, pp 53-68

16 Pages Posted: 24 Apr 2021

See all articles by Rajshree Sharma

Rajshree Sharma

affiliation not provided to SSRN

Shivani Gupta

affiliation not provided to SSRN

Dr. Bhupendra Kumar

Debre Tabor University

Date Written: December 16, 2016

Abstract

Scandals are often the “tip of the iceberg”. They represent the "visible‟ catastrophic failures. An attempt is made in this paper to examine in-depth and analyze India‘s Enron, Satyam Computer‘s “creative-accounting” scandal. Their scandal/fraud has put a big question mark on the entire corporate governance system in India. In public companies, this type of 'creative‘ accounting leading to fraud and investigations are, therefore, launched by the various governmental oversight agencies. The accounting 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. Scandals have proved that ―there is an urgent need for good conduct based on strong corporate governance, ethics and accounting & auditing standards. 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. The increasing rate of white-collar crimes ―demands stiff penalties, exemplary punishments, and effective enforcement of law with the right spirit.

Keywords: Corporate accounting scandal, Satyam Computer India, Corporate governance, Accounting and auditing standards

Suggested Citation

Sharma, Rajshree and Gupta, Shivani and Kumar, Bhupendra, Satyam Computer Scam – Pre and Post Diagnosis (December 16, 2016). International Journal of Marketing & Financial Management, Volume 4, Issue 9, Dec-2016, pp 53-68 , Available at SSRN: https://ssrn.com/abstract=3826780

Rajshree Sharma

affiliation not provided to SSRN

Shivani Gupta

affiliation not provided to SSRN

Bhupendra Kumar (Contact Author)

Debre Tabor University ( email )

Faculty of Business & Economics
Amhara
Debre Tabor
Ethiopia

HOME PAGE: http://www.dtu.edu.et/

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