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CAs vie for Birla firm audit accounts
BS Corporate Bureau in Mumbai | July 17, 2004 11:45 IST
Chartered accountant firms are making a beeline to Birla companies eyeing the job of Lodha & Co, statutory auditors, which is set to get the boot from the Birlas.
The audit firm will not be reappointed at the forthcoming annual general meetings of Birla companies.
"Even before Lodha & Co is formally shown the door, CA firms across the country have started pitching for the assignment," said a Birla insider.
Lodha has been associated as statutory auditors for close to a dozen Birla companies including Mangalam Cement, Mangalam Timber Products, Birla VXL, Mysore Cements, Indo Gulf Fertilisers, Grasim Industries, Siddharth Xpro and Saurashtra Chemicals.
The auditors are normally appointed for a year. The Birla companies will not seek reappointment of the auditors at the forthcoming annual general meetings.
Even those companies which have sent out AGM notices with resolutions seeking Lodha's appointment may not be able to pass the resolutions as shareholders are likely to oppose it. In all these companies, the Birlas hold a majority stake.
There is a consensus in the Birla clan that at this juncture they should maintain a distance from the Lodhas.
This follows the disclosure of the Priyamvada Birla will which bequeathed Rs 5,000 crore (Rs 50 billion) worth of assets of the MP Birla empire to Lodha.
This included the M P Birla group's stake in Pilani Investment and Industries Corporation, the holding firm of Birla companies.