Embattled edtech firm Byjus has hit back at its auditor BDOs (MSKA - associates) resignation.
(Photo: Reuters)3 min read Last Updated Sep 07 2024 | 2:42 PM ISTEdtech firm Byjus on Saturday hit back at its auditor BDO, hours after it resigned citing inadequate support, alleging that the firm made unethical requests and did not follow set procedures.The embattled firm, which is fighting an insolvency case, alleged that BDO (MSKA and associates) requested to backdate Byjus reports.In a statement, the edtech firm said, BYJUS has complied with every request made by BDO, except those that would require crossing ethical and legal boundaries.
The real reason for BDOs resignation is BYJU'S firm refusal to backdate its reports, while BDO went to the extent of recommending a firm that could facilitate such an illegal activity.The Byjus statement further added that they have multiple call recordings, where BDO representatives explicitly suggested backdating these documents, which BYJUS refused to do.On the allegations of Byjus not sharing details with BDO, the company said that the request for information came on July 17, a day later the company entered the insolvency proceedings.
Due to the legal dispute with the Board of Control for Cricket in India (BCCI), Byjus entered into insolvency proceedings on July 16, 2024.In the same email of July 17, BDO threatened to resign if they did not receive the requested clarifications within 45 days.
Notably, BDO failed to mark the Insolvency Resolution Professional (IRP) in this email, despite being aware that as of that date, the IRP was in control of BYJUs and the board had been suspended.
BDO eventually resigned after the 45-day window expired, citing the suspended boards failure to provide the requested clarifications, said Byjus statement.Byjus also claimed that BDO has not been responsive to the requests made by the IRP.
Byjus said that during the first meeting of the Committee of Creditors held on 3rd of September 2024, the IRP explicitly noted that he had repeatedly reached out to BDO for clarification during the last 45 days but had received no response.
BDOs lack of communication with the IRP is surprising and suspicious, said the statement.On the Middle Eastern transaction for which BDO had raised clarification, Byjus said, We wish to make it clear that the suspended Board and management of BYJUS, had taken the proactive step of arranging a forensic audit, fully transparent and supervised by BDO, to ensure that there were no issues well before their email on July 17.
However, the forensic could not be completed due to the initiation of the insolvency proceedings on July 16, 2024.
The failure to complete the forensic therefore cannot be attributed to the suspended Board.First Published: Sep 07 2024 | 2:41 PMIST