Ultimately, the question will have to be asked whether Manoj Kumar, the erstwhile MD and CEO of Ricoh India, was an innocent bystander or whether he was lying through his teeth when he told the ET that “There are no accounting irregularities and there is nothing wrong with recording of sales”.
Manoj Kumar was one of the employees who were sent on “leave” by the Company to facilitate the independent investigation by the auditors, an external firm of Chartered Accountants and a firm of Advocates. The other high-ranking employees sent on “leave” include Arvind Singhal, the Chief Financial Officer, and Anil Saini, the Senior Vice President and Chief Operating Officer. (See Investors Shiver In Fright As MNC Sends Top-Brass Packing & BSE Blocks Escape Route).
Manoj Kumar subsequently resigned probably because he could not take the humiliation of being sent on leave. He is, however, serving his notice period of six months. The other employees are probably going to brazen it out.
After a deafening silence, Ricoh India has finally grudgingly revealed some details of the sordid goings-on within the Company.
In a letter dated 20th April 2016 (which appears to have been filed today, 22nd April 2016), Ricoh has pointed out that BSR & Co, the statutory auditors, had raised certain objections and that the Company had appointed SS Kothari & Co, Chartered Accountants, to look into the matter. SS Kothari submitted a report of their findings which was not agreed to by BSR. Thereafter, PriceWaterhouseCoopers, Chartered Accountants, and Shardul Amarchand Mangaldas, a law firm, were appointed to conduct a “forensic review of the Company”.
Ricoh states that the preliminary report of PWC and SAM reveal that “the books of account and other relevant books and papers and financial statement for the quarter ended on June 30 2015 and half year ended on September 30, 2015 do not reflect true and fair view of the state of affairs of the Company”.
It also stated that the Company is examining the “extent of deviations from true and fair view and the reasons for the same”.
Meanwhile, there is a pall of gloom at the Ricoh India counter at MMB as shell-shocked punters are trying to come to terms with the enormity of the loss.
“It is surprising to note that managements of most MNC`s are always in hiding, never come out and speak to the media, good times or bad times,is it deliberate negliance of their listed subsidiaries or some thing else. Please comment” nicknamechanged904 said in a tone of disbelief.
“MY FRIEND WHAT EX-CEO WAS DOING? EVERY WEEK HE PURPOSEFULLY COMMENTING ON MEDIA ORDER FROM VAKRANGEE, WILL ABLE TO GROW 55/60% ANNUALLY, WON ORDER FROM SIEMENS,………….LAST THREE WEAK I FILL IS ONLY WEAKS WITHOUT ANY BLA BLA ANNOUNCEMENTS. SO WHAT RICOH INDIA WILL NOT HAVE SECURED ANY ORDERS IN LAST THREE WEAKS? WHAT EVER MIGHT BE THE PRICE IT COME DOWN. THE CULPRIT IS NO MORE WITH THE CO. HE HAS NOT EVEN FOLLOWED CODE OF CONDUCT. YES WE ALL RETAIL INVESTOR CAN SURELY ARGUE WITH PARENT, JUST BECAUSE FEW TOP LEVEL MGT. PEOPLE WE SHOULD NOT BE PANELLISED. RICOH CO. JAPAN MUST HAVE TO COME FORWARD WITH FACT SHEET. NO MATTER WHEN THE NEW AUDITOR GIVES THE FIGURES. EACH AND EVERY RETAIL MUST DEMAND FOR THE SAME ON RICOH GLOBAL WEB SITE. INVESTOR`S COLUMN. I HAVE DONE TWO WEEKS BACK STILL WAITING FOR CLARITY.” udays said.
AJ took the opportunity to counsel his embittered boarders: “The story is over for now.. SEBI should better suspend trading in this.. I kept on warning boarders here when the script was at 850 odd level.. that something doesn`t seem right.. and that valuations are absurd.. but boarders like stockvisionary and Aman abused me left right and center…and finally i had to stop posting messages.. now i pity them… hope they bought in truck loads.. and hope they learnt a good lesson for life… sad part is senior member like totalview completely supported them and they all made fun of me and few of us who kept on reiterating that there is some serious problem with the company.. Ricoh cannot delay results… doesn`t seem right.. Now these ppl should learn to respect others.. learn to respect seniors.. learn to respect experience.. !!!”
As I reported earlier, Ramesh Damani appears to have smelt a rat earlier in Ricoh India and made good his escape (See Ramesh Damani’s Brilliant Strategy Saves Loss Even As Ricoh Crumples In Savage Sell-Off).
Now, we have to see whether IDFC MF, which is one of the largest shareholders, will continue to hold the stock. Some mutual funds have an internal policy not to hold on to stocks that are tainted in any manner. Of course, whether anyone will be able to escape now given the circuit limit of 5% is another story altogether!