Grant Thornton submits forensic audit to IL&FS mgmt

Bankrupt IL&FS July 18 said it has completed the first phase of the forensic audit on credit rating agencies that were engaged with its various group companies in the last one decade.

The Uday Kotak-led board of the group had appointed Grant Thornton to conduct forensic audit.

The audit evaluated the role of the various credit rating agencies on various debt instruments and facilitating excessive borrowings from money markets across group companies that eventually led to defaults.

"The mandate for the forensic report was to audit the role of credit rating agencies and discover any possible wrong-doings during 2008-18," a company said in a statement without disclosing the findings.

Grant Thornton has submitted its findings in the interim report to the group, it said.

The report has analyzed several email communications between the erstwhile management and the representatives of credit rating agencies during the specified period.

During the period under review, Care, Icra, India Ratings and Brickwork were the main rating agencies for IL&FS Transportation Networks, IL&FS Financial Services and IL&FS. Brickwork was introduced in ITNL and IFIN from 2016, replacing Crisil, during these 10 years, the company said.

However, rating agency Crisil clarified that it never rated IFIN but only ITNL.

"We would like to clarify on the press statement by IL&FS on the forensic audit which claimed that Crisil had rated IL&FS Financial Services (IFIN). Crisil never rated the said entity," the largest domestic rating agency said in a late night statement.

Of the four rating agencies two--Icra and Care Ratings--took the worst beating as following Sebi queries, both of them sent their MDs--Naresh Thakkar and Rajesh Mokashi--on forced leave. While Mokashi was asked to leave Wednesday, Thakkar was asked to do so earlier this month.