India’s most-valued startup Byju’s is yet to get its 2020-21 (FY21) financial results signed from its auditor Deloitte and could take another few weeks for the company to file them with the ministry of corporate affairs (MCA).
Sources told Moneycontrol that Deloitte had raised 44 concerns and Byju’s had resolved nearly 40 of them. “But there were about four concerns that Deloitte still had and so the company wasn’t ready to sign off the results,” a source told Moneycontrol on July 1.
“I think they will sign off soon but and could be out in another few weeks,” the source added.
Byju’s did not respond to a questionnaire sent by Moneycontrol.
The Bengaluru-based edtech company had said in June that it had completed the consolidation of its FY21 results and would file them with the ministry by the end of June.
As a regulatory requirement, private companies have to file their annual results with the corporate affairs ministry.
"We reiterate that multiple acquisitions were made in FY21 and each of these acquisitions had a different accounting style and year. We have completed the consolidation of businesses and will be filing our financial results this month," a spokesperson for Byju’s had told CNBC TV18.
Also Read: Byju’s COO likely to head India operations as Raveendran focuses on global business
The comments came after a news report by the business website The Ken said that Deloitte had refused to sign on Byju’s results and raised concerns around refunds, loan guarantees and unusual revenue recognition practices.
The delay in filing its FY21 results comes at a time when multiple media reports have suggested that the company is struggling to manage cash for its operations and is resorting to cutting costs aggressively as well as looking at various ways to raise funds.
Byju’s has already announced an $800-million equity fundraise and is also reportedly in talks for $1 billion in acquisition debt financing.
Also read: Layoffs, restructuring, slowdown: India’s edtech firms are struggling post-pandemic
The Morning Context reported that Byju’s has been offloading significant chunks of its trade receivables through pass through certificates, or PTCs, since 2019 and has sold as many as eight tranches of PTCs so far.
A pass through certificate is given to an investor against certain mortgaged-backed securities that lie with the issuer. It can be compared to securities (like bonds and debentures) that may be issued by banks and other companies to investors.
On the cost-cutting part, Moneycontrol reported earlier this week that more than 2,500 employees were sacked from group companies in a bid to cut costs. A few teams have been left with no members.
The struggles of India’s biggest education company symbolise the overall edtech sector, which has been struggling as the coronavirus pandemic has ebbed and students have returned to classrooms.
India’s edtech companies have had two successive exceptional years of hypergrowth but are finding it hard to sustain the momentum this year, with schools, colleges and physical tuition centres resuming work.
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