A company’s public disclosures, including its financial statements and annual reports, are viewed as trusted information sources investors can rely on. But what if the accuracy of these documents comes under a cloud?
While going through a list of stocks that have recently fallen significantly, we came across two companies that made us rethink the accuracy of official financial statements.
Here are their tales.
Rajesh Exports: All that glitters is not gold
This company deals in the flashy metal that we Indians adore – gold. With a market share of around 35 per cent, it is the world’s largest processor of gold and India’s largest exporter of gold products. But when we checked its financial statements and annual reports, things smelled fishy.
On May 30, 2023, Rajesh Exports released its Q4 FY23 results. Although the company claimed that its financial statements were audited, the auditor’s report was missing. Moreover, it did not disclose its FY22 cashflow statement along with its FY23 numbers. Note that Indian accounting standards require the disclosure of comparative financials.
Given these irregularities, the National Stock Exchange asked for clarification. On July 10, Rajesh Exports re-submitted its results, along with the audit report and comparative cash-flow figures. However, we spotted some discrepancies in the cashflow statement.
This story is from the August 2023 edition of Wealth Insight.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber ? Sign In
This story is from the August 2023 edition of Wealth Insight.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
Already a subscriber? Sign In
Bad ideas, F&O trading and the market
Find out the mindset required to find success in F&O trading
Licence Raj Redux?
The import policy changes might take us back to the days of License Raj
How to do magic
Getting great equity returns sustainably only looks like magic, it actually isn't
Data protection and cyber security
The increasing need for cyber security is opening up investment opportunities
"Buying is dependent on pricing but not on timing"
Insights of a fund manager at PPFAS Mutual Fund
Pro vs Amateur
Can amateur stock investors be better than pros? Yes! Here's how
The dimming of Brightcom
Shedding light on irregularities at the Brightcom Group
First tryst with profitability
Find out if food aggregators have found a cure to their loss-making curse
Have We Crossed The Peak Of Inflation?
Find out if the present macro scenario calls for tweaking your portfolio strategy
Tomatonomics
The humour, the stories and what could have been done about tomato inflation