1. Do you agree with Dennis Nally's comments? 2. How do

1. Do you agree with Dennis Nally's comments?

2. How do you think Raju could have used Maytas assets to cover up the fraud?

3. Why are related-party frauds more difficult to detect than frauds with no related parties?

4. Should U.S. public accounting firms try to audit internationally in cultures they may not understand? If so, how can they maintain quality audits?

5. Can an international firm have one set of absolute ethics standards that must be followed at all times, or do ethics standards need to be flexible enough to account for variations in cultures?

6. How can auditors ensure they are receiving authentic documentation, not forgeries?

7. In your opinion, should PWI be subject to civil litigation? PwC?

Satyam Computer Services Ltd.-India's Enron

Imagine that you are on the board of directors of a company and you receive a letter from the chairman of the board that starts, "With deep regret and tremendous burden that I am carrying on my conscience1" and goes on to say that the company's balance sheet carries inflated cash of more than $1 billion, $77 million (m) of accrued interest that is nonexistent, $253m of understated liability arranged by the chairman, and overstated receivables of $101m and that the income statement shows overstated profits for the last several years. Imagine that you were the audit partner, or if you had just awarded the company your global award for excellence in corporate governance (since rescinded)! This is what happened on January 7, 2009, to the board of directors of Satyam Computer Services, its auditor Price Waterhouse India (PWI, the Indian arm of PricewaterhouseCoopers International, PwC), and Ola Ullsten, former Swedish prime minister and chairman of the Golden Peacock Awards.2 As for the shareholders, the value of shares dropped about $2 billion the very next week.

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