Government Seeks Explanation From Byju's For Not Filing Audited Financial Report
The report says that the delay is due to the multiple acquisitions by Byju's during the financial year and it also plans for further acquisitions in the subsequent financial year
The ministry of corporate affairs, reportedly, has enquired edtech unicorn Byju's to explain why the company hasn't filed its audited financial report of the year ending March 2021. Earlier this month, the ministry had sent a letter to Byju's parent company asking them to explain the reason for seventeen-month delay in filing audited accounts.
A spokesperson, on the condition of anonymity, was quoted in a news report as saying, "The ministry's communication about delay in filing the statutory documents was over a month old. Byju's has already replied to the notice. The delay is due to the multiple acquisitions by Byju's during the financial year and it also plans for further acquisitions in the subsequent financial year. Because of the longer-than-expected time taken for accounting multiple transactions, the financial result got delayed. The ministry has already received this reply from Byju's in July. Now, the work is almost completed. So, the report is likely to be filed by next week."
According to industry experts, an unlisted company has to file its annual accounts within seven months of the financial year-end. If any company failed to submit the report within this time frame, they have to pay an additional fee for each day of delay, in which the firm and its directors are liable for fines as well as prosecution in case of excessive delay in filing annual accounts. The prosecution is filed in terms of delay exceeds two years.
According to an IANS report, in July, Congress MP Karti P Chidambaram, had wrote a letter to the Serious Fraud Investigation Office (SFIO) in order to investigate the finances of Byju's.
As per the report, in the letter, it is stated that, "Byju's has not yet gotten its financial statements for FY20-21 audited from its auditor Deloitte, and will take more time to file the cost audit report to the ministry. This is in clear violation of Rule 6(5) of the companies (cost records and audit) rule, 2014. At a time when Byju's proposes to expand its business and acquire Nasdaq-listed company 2U at a valuation of $2.4 billion, while parallel firing of employees to cut costs, it becomes pertinent to review the company's finances."