New Delhi: According to reports, three members of Byju’s board of directors and its official auditor Deloitte have resigned, adding to the edtech company’s escalating problems.
GV Ravishankar, managing director at Peak XV Partners (formerly Sequoia Capital India), Russell Dreisenstock of Prosus (formerly Naspers), and Vivian Wu of the Chan Zuckerberg Initiative have resigned from the board. The development has exacerbated the downward spiral of India’s once-most-valuable privately held firm.
On Thursday, the spokesperson for Byju’s stated that a media report implying the resignations of Byju’s board members is pure speculation.
Auditor Deloitte Resigns, BDO To Replace
Deloitte noted in a letter dated June 22 that Byju’s financial statements for the fiscal year ending 2022 are overdue.
The auditor highlighted, “Following the Companies Act, 2013, the audited financial statements for the year ended March 31, 2022, were due to be laid before shareholders in the Annual General Meeting by September 30, 2022. We have also not received any communication on the resolution of the audit report modifications in respect of the year ended March 31, 2021, 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. As a result, our ability to plan, design, perform and complete the audit following the applicable auditing standards will significantly impact our ability.”
BYJU appointed BDO (MSKA & Associates) as its statutory auditor for the fiscal year beginning in FY22 and continuing for the next five years.
The news comes as the Bengaluru-based edtech is embroiled in court battles with lenders, debt defaults, and the much-delayed submission of its financial reports for the fiscal year ending March 31, 2022. According to reports, the investor group chose it because the company’s handling of the disagreement with lenders was ineffective.
Prosus stated last year that it had lost significant influence’ over Byju after its ownership in the company was reduced to just under 10 per cent. As of November 2022, it owned around 9.67 per cent of the edtech firm, which is currently facing several issues, including completing new conditions for its USD 1.2 billion term loan B. Peak XV Partners owns approximately 6 per cent of the company, while Byju Raveendran and his family own about 26-27 per cent of the edtech company.
