Jagathi Publications Hit by Auditing Scam

Publish Date:Nov 12, 2011

Kadapa MP Jagan Mohan Reddy's firm Jagathi Publications is under scanner. Value of Jagathi Publications was allegedly overstated by Rs 1,000 crore at Rs 3,500 crore. In what is being called another Satyam-like scam, auditing firm Deloitte reportedly admitted to fudging the accounts of the Kadapa MP Jagan Reddy-owned media house Jagathi Publications.

 

The company reportedly told a Hyderabad court it had pumped up the value of Jagathi by one Rs 1000 crore from Rs 2,500 to Rs 3,500 crore in April 2008. Deloitte added that it had been been pressurised by the company to inflate the value. Jagathi auditor Vijay Sai Reddy has dismissed the allegations, says it's a campaign to malign Jagan's image. Jagan and Vijay Sai Reddy are being probed by CBI in disproportionate assets case.

Jagathi had told Deloitte that the figures were just for internal purposes but later made the report public to prospective investors. Deloitte said it was a private deal with Jagathi, hence there was no need to report to regulators. This is second known instance of a multi-national audit firm fudging the account books of a company in recent times. In 2008, PricewaterhouseCoopers had cooked the account books of Satyam Computer Services in an estimated fraud of Rs 14,000 crore