INTERNATIONAL - Reliance Capital said on Thursday the observations of global audit firm PwC about its fiscal accounts were “completely baseless and unjustified”, after PwC in a surprise move resigned earlier this week as the auditor of the non-banking financial company (NBFC).
In a letter to Reliance Capital, PwC said it felt compelled to withdraw from the audit of the company’s fiscal year 2018/19 accounts after not receiving a “satisfactory response” to its queries on certain observations in its assessment, Reliance Capital said in a statement on Wednesday.
Shares in Reliance Capital have declined for two straight days after the announcement of PwC’s resignation.
Reliance Capital said on Thursday PwC’s move was driven by “fear psychosis” and that the company acted prematurely without even a statutory discussion with the audit committee.
PwC pointed out irregularities in the books of accounts of Reliance Capital and Reliance Home Finance around the alleged diversion of funds, and concerns with some related party transactions, the Economic Times on Thursday.