Mumbai, Aug. 5: Shares of Moser Baer India went into a tailspin today after rumours swirled that its auditor S. R. Batliboi had apparently been asked to go because of a row over the way its books were being scanned.
The scrip closed at Rs 257.15 on the Bombay Stock Exchange (BSE), shedding a whopping Rs 63.20. It would have lost more, but the slide was checked by circuit-filters that do not allow a decline of over 20 per cent.
Foreign investors and local institutions wary of the implications decided to dump the stock. The company rushed to control the damage when it clarified the true state of affairs to the BSE. It informed the bourse that “speculative statements concerning change of auditors are false and baseless”. It denied rumours about an accounting fudge at the country’s largest storage disk maker.
“It was an administrative decision and their tenure has no bearing on the terms of agreement. K. C. Khanna and Co was our auditor before the appointment of S. R. Batliboi,” said Rakesh Govil, head of corporate strategy and treasury at the company.
Deliotte Haskins & sells will continue to be company’s internal auditors. However, officials of Batliboi were not available for their take on the turn of events.
“Moser Baer India has decided to discontinue the current audit relationship with S. R. Batliboi after its resignation. The board has recommended the appointment of K. C. Khanna & Co. as the statutory auditors of the Company, to the shareholders.
The recommendations made by SRB during the period of association, continue to be implemented by MBI.
The statement also said the company is in discussions with accounting firms of international standing for appointment as the joint auditor, with the continued objective of implementing international best practices and better integration of the company's global operations.