Having failed to detect the Satyam scam, the government has
embarked on a new vigilant system to track corporate frauds. As a part of
this, it has decided to look into companies whose financials are found to be
suspicious.
There will be several triggers to generate any suspicion on
the activities of a corporate. These include things like unusually high jump
in profits, suspect related party transactions, and huge amounts of unutilised
cash and bank balance, the official said.
Once a list of suspect companies is drawn up, these would be looked into by
the RDs and the RoCs who would look into their filings and financials further.
However, this would be a noninvasive document verification exercise, the
official said, pointing out that there was no intention of hounding the
corporate sector.
The technology-driven initiative comes as the government is
taking steps to further strengthen the MCA21 programme, which was initiated in
2006 and enables electronic filings, storage, retrieval, processing and
transmission of transactions, including incorporation of a company, and filing
of annual and statutory returns. The exercise to upgrade MCA21 has started,
ministry officials said.
(Note : Let us keep our fingers crossed & see how
the system actually works. People behind the system are more important than
the technology involved. Corruption can subvert any sophisticated & advanced
system.)
(Source : The Times of India, 27-10-2009)
