KPMG independence not affected by fraud, says Wipro
23 May 2011
US market Securities & Exchange commission has asked information technology major Wipro to prove the independence of its auditor KPMG India, failing which the company may have to appoint new auditors and get its books audited again, says a report.
"We have received a voluntary document request from the SEC's division of enforcement. The document request includes, among other things, issues relating to auditor independence," Wipro said in an April 20 regulatory filing with the SEC.
It further said that it was cooperating with SEC's request.
If SEC differs with the conclusions reached by KPMG and Wipro's audit committee about the independence of the auditor, it might require the company to "retain new auditors and have our financial statements for one or more years re-audited," the filing added.
According to a report in The Economic Times, the issue of KPMG's independence in auditing Wipro's accounts came up after it was detected last year that a junior level employee had embezzled company funds in collusion with a junior member of KPMG India's audit team working on Wipro audit engagement.
However, the investigations by Wipro as well as KPMG India concluded that that issue did not impair the auditing major's independence with regard to its engagement with the IT firm, the company said.
