X

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.


Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
The allure of the Big Four - Views on News from Equitymaster
 
 
  • PRINT
  • E-MAIL
  • FEEDBACK
  • A  A  A
  • Jan 15, 2009

    The allure of the Big Four

    Satyam's likely new auditors
    Ever since the biggest fraud in corporate India (Satyam) was unraveled, the saga has been occupying the front pages of leading business dailies. The company's chairman, MD, CFO, board of directors and the auditors (Price Waterhouse) have all come under fire. Given that the auditors have been severely criticised for their inability to detect this fraud of epic proportions it was not surprising then that Price Waterhouse had to be replaced with a new team of auditors. As per a leading business daily, KPMG and Deloitte, both of whom are part of the Big Four in the accounting and audit world, have been appointed as joint auditors of Satyam.

    After the Enron scandal in the US which saw the demise of the then reputed Arthur Andersen and the latest Satyam fiasco, the reputation of these big accounting firms have come under the scanner and therefore the question to be asked is whether it makes sense for the new set of auditors to be appointed from this circle. Infact, there is already a buzz doing the rounds in the accounting fraternity that there is an urgent need to appoint a high ranking Indian accounting firm as joint auditor for the beleaguered software company. Is this a case of jumping from the frying pan into the fire? One will have to wait and watch.

    CEOs in the US are being fired
    Job losses in the US have taken a quantum leap amidst the global financial crisis. But the thing to note is that no one, not even CEOs have been spared. Infact, the current financial crisis has turned out to be a nightmare for the CEO community, many of them having seen their jobs getting axed due to poor financial results, plunging stock prices and increasing criticism from shareholders. This is not really surprising as the actions of CEOs are minutely scrutinized especially during bad times such as these when the pressure on them to tide over the crisis is high.

    But firing CEOs at the drop of a hat may actually turn out to be counterproductive. This is because the new person who assumes office is expected to reverse the fortunes of the company in a short span of time, which may not be sufficient enough to grasp the dynamics of the business. That has, however, not stopped the corporates in the US from showing the door to CEOs across industries. In the last eight days, six CEOs have already departed. As per reports in a leading business daily, 61 companies in the S&P-500 changed CEOs as compared to 56 a year earlier. Leo Tolstoy, the famous Russian novelist had quoted in one of his works, "All happy families resemble one another, each unhappy family is unhappy in its own way". In the corporate world atleast, it looks like the unhappy families resemble one another.

    India's oil imports more than double...
    We are not talking of crude here but edible oil. India is the world's biggest buyer of vegetable oils after China and the decline in palm oil prices coupled with the rise in demand led to an increase in imports in December. As per Bloomberg, edible oil imports in the first two months of the season that began in November almost doubled to 1.24 m tonnes. Vegetable oil prices had slid 53% in the second half of 2008, after reaching a record in March, as production exceeded demand. Besides the low prices, anticipation of an import duty by the Indian government on palm oil imports (20% duty has already been imposed on crude soybean oil imports) could also have contributed to the surge in the same.

    India relies on imports to meet almost half its edible oil demand with palm oil accounting for almost 90% of India's edible oil imports. This only highlights India's growing dependence on oil imports be it crude or edible oil. As regards the former, India currently imports around 70% of the crude oil that it consumes.

     

     

    Equitymaster requests your view! Post a comment on "The allure of the Big Four". Click here!

      
     

    More Views on News

    How to Ride Alongside India's Best Fund Managers (The 5 Minute Wrapup)

    Jun 10, 2017

    Forty Indian investing gurus, as worthy of imitation as the legendary Peter Lynch, can help you get rich in the stock market.

    You've Heard of Timeless Books... Ever Heard of Timeless Stocks? (The 5 Minute Wrapup)

    Aug 19, 2017

    Ever heard of Lindy Effect? Find out how you can use it to pick timeless stocks.

    Why NOW Is the WORST Time for Index Investing (The 5 Minute Wrapup)

    Aug 18, 2017

    Buying the index now will hardly help make money in stocks even in ten years.

    Trump Takes a Beating (Vivek Kaul's Diary)

    Aug 18, 2017

    Donald J Trump, a wrasslin' fan, took a 'Holy Sh*t!' blow on Tuesday.

    How To Read Your Mutual Fund Account Statement Correctly (Outside View)

    Aug 17, 2017

    PersonalFN simplifies the mutual fund account statement for you.

    More Views on News

    Most Popular

    Demonetisation Barely Made Any Difference to Tax Collections(Vivek Kaul's Diary)

    Aug 7, 2017

    The data tells us quite a different story from the one the government is trying to project.

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    Should You Invest In Bharat-22 ETF? Know Here...(Outside View)

    Aug 8, 2017

    Bharat-22 is one of the most diverse ETFs offered so far by the Government. Know here if you should invest...

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    7 Financial Gifts For Your Sister This Raksha Bandhan(Outside View)

    Aug 7, 2017

    Raksha Bandhan signifies the brother-sister bond. Here are 7 thoughtful financial gifts for sisters...

    More
    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407
     

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms

    S&P BSE SENSEX


    Aug 18, 2017 (Close)

    MARKET STATS