Deloitte flags Adani Ports transactions, citing 'insufficient disclosures'

Deloitte Haskins and Sells has raised concerns over Adani Ports & Special Economic Zone's transactions with three entities. As per a Bloomberg report, the auditor said there were insufficient disclosures with regard to certain transactions.

Deloitte said it couldn't confirm that the parties were unrelated, since the Adani group refused to get an independent external examination that would help prove that. It therefore signed off on the company’s books only with what’s called a “qualified opinion”, said the Bloomberg report.

As per Bloomberg, it’s the first time that a top auditor has issued a qualified opinion on part of the port-to-power conglomerate’s books citing allegations from the US short seller report that had wiped more than $100 billion off the group’s market value. The move will renew concerns that information gaps persist in Adani’s financial dealings, and risks hampering its attempts to move past Hindenburg’s allegations of extensive corporate fraud.

While the Adani group denied all allegations, the Supreme Court constituted an expert committee for assessment of the extant regulatory framework and asked stock market regulator SEBI to complete its probe into allegations.

The six-member expert panel earlier this month, found no regulatory failure by capital markets regulator SEBI or signs of price manipulation in the Adani Group stocks in its interim report.

The transactions flagged by Deloitte included engineering, procurement and construction (PEC) purchase contracts with a subsidiary of a party identified in the Hindenburg report.

Deloitte said it conducted its audit in accordance with the Standards on Auditing specified under the Companies Act, 2013. "We are independent of the group and of its joint ventures in accordance with the Code of Ethics issued by the Institute of Chartered Accountants of India."