According to a Bloomberg News report, the Indian Ministry of Corporate Affairs (MCA) has initiated an inspection of the account books of the ed-tech startup Byju's. The investigation is reportedly centered around allegations of governance lapses and non-compliance with regulations.

In a recent development, it has been reported by Bloomberg, citing insider sources, that the Indian government is set to investigate the accounts of the ed-tech company Byju's. The Ministry of Corporate Affairs (MCA) has reportedly requested a comprehensive report on the Indian startup within a timeframe of six weeks.

Furthermore, the decision to involve the Serious Fraud Investigation Office (SFIO) will be contingent upon the outcome of the inspection and its subsequent findings.

According to sources within the ministry, CNBC-TV18 reported that as of the present time, the Serious Fraud Investigation Office (SFIO) is not conducting any investigations into the company.

However, the ministry itself is currently undertaking an investigation into Byju's, focusing on alleged instances of non-compliance with financial reporting regulations and governance shortcomings. Following the completion of the ministry's probe, the matter will be referred to the SFIO for further examination.

Days after a report by The Hindu Business Line, which quoted an anonymous source, claiming that the Serious Fraud Investigation Office (SFIO) had initiated an investigation into Byju's, the ed-tech company has responded. Byju's stated to Mint that they have not received any communication from the SFIO thus far.

In light of the recent reports and to address corporate governance concerns, the ed-tech start-up has reportedly made the decision to establish a Board Advisory Committee (BAC).

Amidst mounting challenges, Byju's has encountered various issues, including the resignation of three board members, the departure of its auditor Deloitte due to pending financial statements, and reported delays in provident fund payments to the Employees' Provident Fund Organisation.

Deloitte, in a letter sent last month, cited the non-submission of 2022 financial statements as the reason for their immediate resignation. Although Byju's informed investors that the financial statements would be filed by September, the company has reportedly faced delays in provident fund payments since October last year, according to data sourced from EPFO.

Image source: Outlook India