Price Waterhouse Chartered Accountants LLP has quit as the statutory auditor of GVK Power and Infrastructure Ltd, alleging that the group was not cooperating in the audit work for their Mumbai airport operations.
On Friday, GVK Power submitted a copy of the statutory auditor's resignation letter, dated August 13, to the stock exchanges.
The auditor alleged that despite several communications, the group did not provide them with necessary information.
"In view of various matters described in our communications, including the recent events in relation to company's subsidiary Mumbai international Airport Ltd (MIAL), we have assessed the appropriateness of our continuance as the statutory auditor of the company... we accordingly wish to communicate our intention to resign as statutory auditors of the company," the letter said.
Recently, CBI registered a case against GVK Group Chairman G V K Reddy, his son Sanjay Reddy, their companies and nine other private firms that were allegedly used to camouflage the inflated figures using sham deals and unidentified AAI (Airports Authority of India) officials.
The Enforcement Directorate also filed an enforcement case information report, equivalent to the first investigation report registered by police, under the Prevention of Money Laundering Act, after studying a recent CBI FIR filed against the same entities.
The resignation letter cited various communications with regard to the audit of the financial statements for the year ended March 2020 that is in progress and various matters in relation to which the auditor is "awaiting information and explanations (including reporting from component auditors) to be in a position to conclude the audit.
"Details of information and explanations sought and still not provided is reiterated in our letter dated 12 August 2020 to the management and copied to the audit committee taken together with our letter to the audit committee and copied to the management also dated 12 August 2020," it noted.
In the resignation letter, the auditor also said that GVK Power is requested to take the necessary steps in order to comply with the applicable various Sebi circulars and other regulatory requirements in this connection.
"Our resignation as statutory auditors of the company shall accordingly be effective immediately on discharge of our obligations under the Companies Act 2013," it said.
Price Waterhouse Chartered Accountants LLP was appointed as statutory auditors for five years at the company's annual general meeting held in September 2017.
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