Deloitte’s Adani Ports exit reveals a Hindenburg link

livemint.com:

₹1.75 trillion Gautam Adani-led company’s resistance to conduct an independent external evaluation. As a “material weakness" identified as at 31 March, Deloitte said, “The company (Adani Ports) did not have an appropriate internal control system in respect of conducting an external examination of allegations made on the company." Deloitte said Adani Ports did not have adequate internal control system to even examine veracity of allegations ( made by Hindenburg) on related party relationships, which could potentially result in possible adjustments or disclosures of related party relationships, balances and transactions in the standalone financial statements.

A ‘material weakness’ is a deficiency in internal financial control, in the absence of which there could be a reasonable possibility that a material misstatement of the company’s annual or interim financial statements will not be detected in time. After a 90-minute meeting on 12 August between Deloitte and Adani Ports, in a 163-page resignation letter Deloitte said, “We are not statutory auditors of a substantial number of other Adani Group of companies (as referred to under “Other Matters" ...) including an Adani Group company (and its subsidiaries) after completion of our term of five years." “Therefore, the scope of our audit does not extend to any transactions or balances which may have occurred or been undertaken between these Adani group companies and any supplier, customer or any other party which has had a business relationship with the company during the year," said the letter.