Probe found lapses in corporate governance but vindicated financial fraud cues

Byju’s, an Indian multinational educational technology company headquartered in Bengaluru underwent a government investigation into financial anomalies and found lapses in corporate governance but vindicated financial fraud cues. It was a long one-year investigation by the Ministry of Corporate Affairs. The probe found no evidence of misconduct.

According to the reports, the scrutiny did not find any wrongdoings such as the illegal transfer of funds, manipulation of accounts and fraud handles. It was discovered that the companies contributed to the start-up have confronted economic losses but no fraud practices were found in the investigation.

Also, read| Once Valued At $22 Billion, Byju’s Value Is Now Cut To Zero

The struggling start-up Byju’s by Byju Raveendran once created momentum and gradually drained its health and found null at the finances. He was accused of mismanagement by other investors who were dissatisfied with the company’s performance. Companies like Prosus Ventures and Peak XV Partners pulled up stakes over a fray with Byju Raveendran last year. They spoke about their differences in financial dealings and internal controls but in vain.

The probe further declared that the government relinquished from the inquiry at least for now and there is no new case or scrutiny found to investigate the company’s internal matters.

The inquiry report didn’t disclose information about the lapses found in the probe, but detailed internal issues and compliance failures. The report didn’t address Byju Raveendran’s future hopes to run the company. On the contrary, the probe averted the company’s rigorous issues and went to a detailed study on how it was pulverised into ashes.

The unproductive practice, company’s decision to expand and its partnership with further start-ups led to a cash crunch and left the company in the lurch. The company further failed to manage systematically to oversee finances and internal governance also affected its stability.

Also, read| Arjun Mohan Steps Down As Byju’s CEO

The ed-tech start-up was valued at $22 billion once at its extremum. Major companies were in awe of its rapid growth and development. Later, Covid risked the money flow but more people joined as the classes subsided on account of the pandemic. The cash heap shrivelled up and the company struggled to survive and went down to zero bit by bit.

Nevertheless, Byju Raveendran has managed to keep up with the period through his strenuous efforts and is expected to rebuild his core business pondering on generative AI for so-called hyper-personalised learning for all students. He also managed to pay his employees by mortgaging his assets to maintain his financial credibility among his workers. He was able to raise more than $100 million from investors through capital shares, but an Indian court barred him from using the money for any purposes.

Also, read| Byju’s Shuts Down Most Of Its India Offices