The Ministry of Corporate Affairs has ordered an inspection of the books of BYJU'S, a senior government official said on Monday. The inspection of Bengaluru-based Think & Learn Pvt Ltd, which controls BYJU'S, will be carried out by the ministry, which is implementing the companies' law, PTI reported.
The embattled edtech major has been reeling from issues ranging from exits of three board members and its auditor to concerns over corporate governance issues.
The company has also attracted controversy for mis-selling courses, corporate governance issues, and more.
In June, Deloitte Haskins and Sells resigned as BYJU'S auditor citing a delay in submitting financial statements. GV Ravishankar of Peak XV Partners (Sequoia Capital India), Russel Dreisenstock of Prosus, and Vivian Wu of Chan Zuckerberg Initiative also resigned from Byju’s board.
Earlier this month, the ministry asked the office of the Regional Director in Hyderabad to conduct an inspection of the company, which is registered in Bengaluru, the official said.
The official also said that further course of action will be decided after receiving the inspection report. Earlier, it was reported that the Union Ministry of Corporate Affairs was planning to involve the Serious Fraud Investigation Office (SFIO) to look into the irregularities at Think and Learn Pvt. Ltd.
In December 2022, BYJU'S is facing multiple headwinds from ongoing lawsuits with lenders over a larger $1.2 billion loan, a growing rift between shareholders, board resignations, delay in filing of results, auditor resignation and an ongoing investigation from the Enforcement Directorate over alleged FEMA violations.
Last week, BYJU'S said it has formed a new advisory council, where former Infosys chief financial officer TV Mohandas Pai and former State Bank of India chairman Rajnish Kumar joined as its council members. The council will play an important role in mentoring and advising the BYJU’S team including CEO Byju Raveendran, a statement from the company said.
"The founders of BYJU'S are pleased to announce that Rajnish Kumar and TV Mohandas Pai have accepted their invitation to join the company's newly constituted Advisory Council. This council will play a pivotal role in advising and mentoring BYJU'S Board and its CEO, Byju Raveendran, on crucial matters that shape the company's future," BYJU’s said in a statement.
In a press statement, Pai said, "Byju and Divya are among the most impressive entrepreneurs I have worked with from the start-up ecosystem. Since our first contact more than a decade ago, they have built the largest edtech company globally and amongst the largest start-ups in India. I see in them the drive to build the group into a successful corporation, and to ensure they deliver upon their mission in this sector as a category creator and market leader."
"As part of the Advisory Council, I look forward to advising the leadership in evolving the systems of governance and financial reporting, as well as to grow an organisational structure that can serve as a resilient foundation for the future of the company," he added.
Kumar said: “My discussions with Byju and Divya convinced me that they are dedicating sincere efforts to steer a course correction of the company's governance structure. They have reached out to engage with experienced professionals with a proven track record of running large corporates and with a deep understanding of governance issues."
“The company has achieved an impressive growth trajectory and has built significant scale in its base of revenue, operations, and global presence. With calibrated guidance from experienced advisors who have come together to support these dynamic entrepreneurs, the company will be able to move forward and continue to contribute to this very important field of education.”
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