Deloitte resigns as statutory auditor of Byju's and Aakash Educational

Representative image

Deloitte, one of the biggest audit firms in the world, has tendered its resignation as the statutory auditor of Byju's, adding to a long list of troubles for India's most valued startup.

"The financial statements of the Company for the year ended March 31, 2022 are long delayed. We have also not received any communication on the resolution of the audit report modifications in respect of the year ended March 31, 2021, and the status of audit readiness of the financial statements and the underlying books and records for the year ended March 31, 2022 and we have not been able to commence the audit as on date," said Deloitte in a statement.

"As a result, there will be a significant impact on our ability to plan, design, perform and complete the audit in accordance with the applicable auditing standards. In view of the aforesaid, we are tendering our resignation as statutory auditors of the Company with immediate effect," Deloitte added.

Byju's appointed BDO (MSKA & Associates) as Deloitte's replacement and as the company's statutory auditors for the year commencing from FY22 for the next five years. BDO will also be the statutory auditor of the consolidated group and will audit IPO-bound Aakash Educational Services.

Deloitte's resignation comes at a time when key board members of Byju's also tendered their resignations from the company's board due to differences with founder Byju Raveendran on key operational issues.

Deloitte's resignation leaves Byju's in limbo as the edtech company's FY21 (2020-21) results had outlined a number of irregularities with respect to the company's revenue recognition practices. Byju's also had to defer about 40 percent of its FY21  revenue to subsequent years as advised by Deloitte.

Byju's reported a surprise decline in FY21 revenue, which, otherwise was a massive year for edtech companies in India and also globally, thanks to Covid-19's stay-at-home restrictions that gave a huge boost to online learning. Byju's losses also mounted to over Rs 4,500 crore in FY21.