‘Ethical employees’, a group of anonymous Infosys employees, has accused the information technology company’s CEO and CFO of knowingly producing wrong account statements and trying to cover up accounting irregularities. The group claims to have the proof required to corroborate the allegations and has said that relevant e-mail and audio recordings on the matter will be submitted during the investigation, if required.
The complaint is being examined and looked into by the Audit Committee in keeping with the organisation’s standard practice and will be handled as per the whistle blower’s policy.
One of the allegations made is that Infosys is not recognising visa costs totally, just to improve margins, which was an issue highlighted by the auditors too.
Another allegation is that the CEO bypassed reviews and approvals in order to obtain large deals without making the sufficient disclosures to the board members. Apparently, some of the large deals have zero margin.
It is also alleged that Infosys has not recognised almost $50 million of reversal of upfront payments in the first tier, downstream and related entities contracts, which could make profits dip.
Following these allegations, it appears as if the auditors are being stopped from doing their jobs properly and many issues have been kept hidden from them.
The anonymous ‘ethical employees’ have requested the board to investigate the matter and take immediate action.