Blackstone-backed Financial Technologies India Ltd (FTIL) has disclosed that its auditor Deloitte Haskins & Sells has warned that the audit report for 2013 should not be relied upon in light of the irregularities related to subsidiary National Spot Exchange Ltd (NSEL).
Deloitte Haskins & Sells had submitted audit report for the financial statements of FTIL for FY13 on May 30, 2013.
The auditor had approved the financials of on May 30, while the first signs of trouble at its wholly-owned subsidiary, NSEL, came to light on July 31.
The firm said it has decided to defer certain agendas on the scheduled AGM on Wednesday and will satisfy the statutory auditors of the company on standalone financial accounts though standalone and the consolidated financial statements were audited prior to the intimation of the irregularities at NSEL which came to light on July 31.
It added that as per the standalone financials of FTIL, the total income forms part of revenue generated from NSEL during the FY13 is largely on account of technology services which contributes only 4.79 per cent of the total income of FTIL; no outstanding amount is pending against the same.
It also said the contribution of net profit from revenues generated by NSEL is just 6.56 per cent as per standalone financials and hence is not significant.
Financial Tech share price has fallen over 70 per cent since NSEL suspended trading. It closed at Rs 150.20, down 10.25 per cent on the BSE in a weak Mumbai market on Wednesday.
Blackstone had been buying shares of FTIL since last year and as of June 30, 2013 held 7 per cent stake. It is estimated to have put in over Rs 250 crore to buy shares of FTIL which is currently worth just under Rs 50 crore.
The PE firm had also gone ahead and invested in group firm MCX, India's largest commodity bourse.
(Edited by Joby Puthuparampil Johnson)
