Reliance Infrastructure falls as auditors raise red flags on fourth quarter results

By Abhirup Roy and Promit Mukherjee MUMBAI (Reuters) - Shares in Reliance Infrastructure Ltd closed nearly 5% lower on Monday, after its auditors raised red flags around its latest financial results and cast doubts over the manner in which the firm had accounted for several transactions. The company, a construction, power and defence conglomerate that is part of business tycoon Anil Ambani's Reliance Group, late Friday reported a consolidated loss of 33.01 billion rupees ($472.56 million) for the quarter ended March 2019. The loss was mainly attributed to a 45 billion rupee write-off related to its associate Reliance Naval & Engineering Ltd RELV.NS and a 20 billion rupees impairment booked in Reliance Power, its power generation subsidiary

Reuters June 18, 2019 00:11:08 IST
Reliance Infrastructure falls as auditors raise red flags on fourth quarter results

Reliance Infrastructure falls as auditors raise red flags on fourth quarter results

By Abhirup Roy and Promit Mukherjee

MUMBAI (Reuters) - Shares in Reliance Infrastructure Ltd closed nearly 5% lower on Monday, after its auditors raised red flags around its latest financial results and cast doubts over the manner in which the firm had accounted for several transactions.

The company, a construction, power and defence conglomerate that is part of business tycoon Anil Ambani's Reliance Group, late Friday reported a consolidated loss of 33.01 billion rupees ($472.56 million) for the quarter ended March 2019.

The loss was mainly attributed to a 45 billion rupee write-off related to its associate Reliance Naval & Engineering Ltd RELV.NS and a 20 billion rupees impairment booked in Reliance Power, its power generation subsidiary.

Auditors BSR & Co, and Pathak H.D. & Associates pointed out several anomalies and a lack of clarity in instances of related party transactions and accounting methodology.

Losses incurred by the company and subsidiaries and certain loans for which the company is a guarantor show that some "material uncertainty exists that may cast significant doubt on the group's ability... to continue as a going concern," according to the auditors' report posted on the company website.

In response to a Reuters query, Reliance Infrastructure said the group has already announced the sale of one of its road assets in north India that will bring in 19 billion rupees of cash.

The company also said it stands potentially to get substantial funds from pending regulatory claims and arbitration proceedings.

The company did not respond to specific queries around the auditors' concerns.

Ambani and his companies have lately faced greater scrutiny from auditors and rating agencies, even as bankers and creditors have pressured his firms to pay back dues.

Last week PwC resigned as the auditor of group company Reliance Capital Ltd RLCP.NS, saying it did not receive a "satisfactory response" to its queries on certain observations in its assessment of the annual financial results.

(Reporting by Abhirup Roy and Promit Mukherjee; Editing by Rashmi Aich and David Evans)

This story has not been edited by Firstpost staff and is generated by auto-feed.

Updated Date:

TAGS:

Find latest and upcoming tech gadgets online on Tech2 Gadgets. Get technology news, gadgets reviews & ratings. Popular gadgets including laptop, tablet and mobile specifications, features, prices, comparison.

also read

Trump says catching COVID-19 was a 'blessing from God'
World

Trump says catching COVID-19 was a 'blessing from God'

By Jeff Mason and Steve Holland WASHINGTON (Reuters) - U.S. President Donald Trump on Wednesday declared that catching the coronavirus was a "blessing from God" that exposed to him to experimental treatments he vowed would become free for all Americans, in his first video message since leaving hospital

Hurricane Delta rips through Cancun, but damage less than feared
World

Hurricane Delta rips through Cancun, but damage less than feared

By Anthony Esposito CANCUN, Mexico (Reuters) - Tourists in Mexico's top Caribbean resort Cancun picked their way through battered streets, broken glass and trees downed by Hurricane Delta on Wednesday, though damage was less severe than some feared as the storm tore across the Yucatan peninsula. Delta lost force before it reached land.

U.S. to go down to 2,500 troops in Afghanistan by early 2021 - Trump adviser
World

U.S. to go down to 2,500 troops in Afghanistan by early 2021 - Trump adviser

WASHINGTON (Reuters) - The United States will reduce its troops in Afghanistan to 2,500 early next year, national security adviser Robert O'Brien said on Wednesday, offering greater detail about the pace and scope of the drawdown from America's longest war. A landmark deal between the United States and the Taliban in February said that foreign forces will leave Afghanistan by May 2021 in exchange for counter-terrorism guarantees from the Taliban, which agreed to negotiate a permanent ceasefire and a power-sharing formula with the Afghan government