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Reliance Capital Calls PwC’s Observations Baseless, Unjustified

Anil Ambani-led Reliance Capital on Thursday, 13 June, said its erstwhile statutory auditor Price Waterhouse & Co Chartered Accountants' observations about its accounts were "completely baseless and unjustified".

Reliance Capitals issued a notice to the stock exchanges, saying Price Waterhouse was no longer the statutory auditor, reported CNBC-TV18. PwC cited 'certain observations' during an ongoing assessment of FY18-19.

Price Waterhouse & Co Chartered Accountants LLP (PwC) resigned as one of the statutory auditors of Reliance Capital and Reliance Home Finance on Tuesday, 11 June.

"PWC's observations are completely baseless and unjustified. PWC has acted prematurely without even statutory discussions with the audit committee," Reliance Capital said in a regulatory filing.

Reliance Capital said its continuing auditor Pathak HD & Associates has been mandated by the audit committee to submit its independent report on PWC's observations within 15 days.

In a letter dated 24 April, PwC stated that Reliance Capital disputed the observation that were pointed out by it. It also said that the Reliance Capital also did not call for an committee meeting within expected time.

Also Read: Anil Ambani Says Reliance Committed to Meet All Debt Obligation

PwC also said that appropriate legal proceedings against the firm might also be initiated.

Embattled tycoon and the chairman of the group, Anil Ambani on Tuesday, 11 June, vowed to cut debt of his group to "bare" minimum and said more than Rs 35,000 crore of loans have been paid back in the last 14 months and all future payment obligations will be met in a timely manner.

Stating that Rs 35,000 crore of payments were made in the face of "insurmountable odds and the most challenging financial environment", he said during the 14 month period, lenders from all categories – banks, mutual funds, insurance companies, provident funds or NBFCs – provided no additional liquidity or debt to any entity of the Reliance Group.

PwC, as quoted by CNBC-TV18, said, "These actions by the company (Reliance Capital) have prevented it from performing its duties as statutory auditors and exercising independent judgement in making a report to the members of the company, and impaired its independence, and hence, it is no longer in a position to complete the audit and instead feels compelled to withdraw from the audit engagement and resign."

(With inputs from PTI, CNBC-TV18)

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