Lagatar24 Desk
New Delhi, June 23: Concerned about Byju’s corporate governance lapses, the Ministry of Corporate Affairs (MCA) has ordered an inspection of the educational technology startup.
The ministry’s action comes in response to recent events, including the separation of Deloitte and three board members from the business amid a legal dispute with lenders and a decline in valuation.
Deloitte, one of the largest auditing companies in the world, recently resigned from its position as Byju’s auditor with “immediate effect” in light of the company’s “long-delayed” financial statements, according to the firm’s resignation letter.
BDO has been chosen by Byju’s as its new auditor. Only the founder’s family members remain on the board after three board members from significant investors Sequoia Capital India, the Chan-Zuckerberg Initiative and Naspers Ventures all quit.
Byju’s valuation was significantly reduced from $22 billion in 2022 to $8.4 billion earlier this year with worries rising over governance issues, audit delays and employee layoffs.
The ed-tech startup is also involved in a legal battle with lenders amid claims that it concealed $500 million, which prompted lender Redwood Management to file a countersuit.
The finance ministry has not issued a statement, and Byju’s has not yet reacted to calls for comment.
