After Biocon, Espirito Santo now questions Educomp corporate governance

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 Espirito Santo now questions Educomp corporate governance
Educomp Solutions: Quotes, News
BSE 8.79BSE Quote0.16 (1.82%)
NSE 8.80NSE Quote0.1 (1.14%)
Biocon: Quotes, News
BSE 403.90BSE Quote13.05 (3.23%)
NSE 402.60NSE Quote14.35 (3.56%)
Close on the heels of raising doubts over Biocon's accounting policies, Portuguese Investment Bank Espirito Santo has questioned the accounting practices of Educomp.

According to a report in the Economic Times Espirito Santo analysts, Soumitra Chatterjee and Nitin Padmanaban have said that documents show that the address for EduSmart's auditor - Sanjay Rastogi & Associates - is the same as that of the firm, potentially jeopardising auditor independence.

"Any sense of excessive closeness between company and auditor will naturally concern investors," they wrote in a client note a fortnight ago.

"Third-party vendors are selected based on their distribution capabilities but EduSmart doesn't have any standalone distribution capability," they said.

A few days ago Espirito Santo had downgraded Bangalore-based Biocon to "sell" from "neutral" and sharply revised its target price to Rs 186 a share from Rs 350, flagging off several issues, which it says raise accounting and corporate governance questions over at the biotech firm.

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Read more about: biocon, educomp
Story first published: Monday, May 28, 2012, 11:17 [IST]
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