Deloitte, KPMG have no license to do audit work in India

KPMG and Deloitte, the two firms entrusted by the new three-member board of Satyam Computer Services to audit the company’s accounts, are not allowed to do audit work in India —a point that has not escaped the attention of the Institute of Chartered Accountants of India (ICAI), the regulatory body for accountants in the country. According to ICAI president Ved Jain: “KPMG is not allowed to practice in India. They are not registered with us.”

KPMG carries out its auditing work in India through BSR & Co, an Indian chartered accountant firm that also signs on the balance sheets of Indian companies. Deloitte on the other hand does auditing through CC Chokshi & Co.

ICAI has over 145,841 registered members, of which fellow members total 61,288, while
associates are 84,193 in number. According to ICAI regulations framed in 1984, foreign audit firms are not allowed to practice in India. Some of the other auditors contacted by ET said that KPMG and Deloitte cannot be appointed as statutory auditors as such a body can only be appointed by the shareholders at an annual general meeting.

On Wednesday, the Satyam board appointed KPMG and Deloitte to look at and restate the accounts of the beleagured software firm. KPMG’s presence in India is through KPMG India Pvt. Ltd (an investment banking firm) and KPMG Consulting (management and consulting). The chartered accountancy firm, BSR & Co, formerly Bharat S Raut, is part of KPMG’s domestic and international network for auditing.