It is a collective failure of directors, auditors and regulatory agencies in ensuring transparencyand accountability; As a consequence of this fiasco, the overseas client may take a hard look atmost Indian outsourcing companies and investment flows could be hit. The responsibility for preventing fraudulent activities lies with the Board of directors. Their acts and conduct impactthe reputation of India and, therefore, they must ensure that the highest standards of corporategovernance are set.The Quality Review Board ('QRB'), an independent body set up under the MCA, is looking intothe standards of audit for chartered accountancy firms with a view to redefine new stringentnorms for audit firms. It may ask the SEBI and MCA to mandate listed companies to rotate their auditors to prevent Satyam-type frauds - practice being followed in public sector companies.Although the investor’s interest is saved as the Satyam is acquired by the Tech -mahindra andalso the mission had been accomplished of all the 6 directors, i.e, Kiran Karnik, Tarun Das,Deepak Parekh, TN Manoharan, S Mainak, and C Achuthan.It is now confirmed that Satyamwould be saved. Their reputations, too, stood burnished. Not that any of them wanted an eventsuch as Satyam to reoccur.But, there is impromptu need of time to take the investigation procedure in effective and efficientway to clear every issue and make it sure that such incident will not happen again in future, it isnecessary to solve the above questions and to fill the gaps of the loopholes. Also, these Issues to be cleared in the course of investigation Now, in next topic we will discuss about the present legal systems and provisions of other’scountries to deal with such frauds, an attempt is made to suggest the possible measures whichcan fill the gaps: -
LEGAL PROVISIONS IN OTHER COUNTRIES TO DEAL THE CORPORATEFRAUDS.
For good corporate governance, Different countries have their own legal mechanism to act, butthe fraud and corruption practices act 1977, and Sarbanes and oxley act (SOX) of United statesraised widespread anxiety and concern over world for such corporate frauds. The detailedstructure of the acts are given as: -