BharatPe ropes in PwC for governance review alongside Alvarez

Even as a management consultant and risk advisory firm Alvarez and Marsal is conducting a full-scale governance audit, Sequoia-backed BharatPe has roped in consultancy firm PwC as part of the ongoing investigation, as per sources privy to the development.

While it casts a shadow on the role Deloitte, will play now, BharatPe said that Deloitte continued to be the statutory auditor for the company

It also confirmed that it had hired PwC "more recently" for a governance review at a time when Alvarez and Marsal are leaned to be conducting a full-scale investigation on the company’s practices, including accounting, approval processes, expenses, and hiring.

The company did not elaborate on the role of PwC in the ongoing investigation, however, according to one of the sources quoted above, PWC will conduct the annual audit of the BharatPe's accounts which so far was done by Deloitte. It is also likely to involve its forensic team given that the company is undergoing a governance audit.

“The (PwC) audit partner who will sign the audit sheet would like to check if there was any issue pointed out by Alvarez on things like non-compliance or siphoning and in case anything it is quantified then it will be brought on the balance sheet as disclosure,” said one of the persons quoted above.

“They will see if a reinstatement of the account would be required,” the person added.

The news of BharatPe's plans to onboard PwC was first reported by Mint.

While an audit deadline for a private company is June 30th, it wasn’t immediately clear if BharatPe had mandated PwC to submit it sooner.

Moneycontrol reported on January 28 that even Ashneer Grover's wife Madhuri Jain Grover, Head of Controls at the $3 billion fintech had been sent on leave as scrutiny over the company’s practices grew.

While Grover was sent on a leave of absence till March-end amid backlash regarding his abusive language to a Kotak employee and toxic culture at BharatPe, his wife also going on leave signified larger issues around governance at BharatPe.

The board has been looking into issues, including invoices possibly being over-inflated and some vendors possibly being fake, said a person directly aware of the matter, who did not want to be named. This person also suggested the possibility that when a merchant recorded a transaction, BharatPe may have inflated the value of these transactions.