Special audit gives virtually clean chit to Bharti's accounts

At the request of the government, there has been executed a special audit on ‘Bharti Airtel’, the biggest telecom operator of India. There were determined some irregularities in the industry, but no fraud.

It’s strange because earlier this week, the report was presented to the Department of Telecom (DoT), and there wasn’t remarked something suspicious. Sunil Mittal-promoted company said the accounting practice was done correctly.

The first audit report was submitted in October 2009. It was performed on RCom, a telecom operator. The controllers had increased some issues concerning to loss of revenue to the Treasury.

Kohli, CEO and joint managing director of Bharti Airtel said that the regulatory compliance is very important for Airtel. The special auditors have validated this belief.

The dealer distribution margins have been quantified by the auditors. Bharti Airtel just pays licence fee on actual realised revenues. It doesn’t pay it on the end-retail price collected by the retail outlets.

The auditors confirmed that the company works with circle-wise and service-wise accounts.
The accountants said that the transfer of revenue from one segment to another doesn’t have the intention to take benefit of the arbitrage.

It’s clear that auditing is very important. There are always companies who are trying to commit fraud.
In this article it’s not concerning fraud, however, this company tries to pay less licence fee at the government. There will be always firms who act dishonestly, for this reason, I think, there has to be a lot of audits in each company!

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