Tuesday, January 10, 2012

Can police sue a thief for not informing about theft?

The question is very simple - can police sue a thief saying that the thief should have informed us before commiting the theft. Since the thief did not inform us when and in what way he is going to do the theft, we were not able to catch him!!

I won't be surprised if this sounds stupid to say the least. But this is what the supposedly educated people do:

Yes, the auditor PriceWaterHouseCoopers who is supposed to find any wrong-doings and audit the accounts is suing Ramalinga Raju, the (erstwhile) CEO of Satyam for hiding the wrong-doings from the auditors and mis-representing documents. Well, isn't that the reason what the auditors are appointed for - to catch such misdeeds. What do the auditors get paid for - to accept whatever management says?

Why would a globally renowned auditor like PWC not independently verify things like bank balance and rely on the forged documents given by the management? Is it to say that we catch only one kind of frauds and not others? The auditors are required and entrusted to catch any form of fraud - whether accounting scandals, mis-reporting, forgery of accounts, whatever. In essence everthing, that's why they should to be able to state that the financial statements published by the company are true statement of accounts.

There are opinions which say that the auditors were hand-in-glove with the Satyam management in the fraud. Well, no one knows. Either they were, or they were incompetent.

It would be interesting to see the court opinion on this kind of lawsuits.

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