M. Damodaran, former SEBI chairman, spoke to Arti Sharma on the fallout from the Satyam fraud:
Impact on brand India: We have emerged from frauds before, so this (Satyam) is not something exceptional. I think we love running ourselves down. I don't see an impact on the way the world perceives India just because of this one event. Sure, it is a huge problem and needs to be addressed, but we don't need to push the panic button.
On manipulation of accounts: It's easy to imply manipulation takes place. We don't have audited quarterly accounts, so auditors can't speak in favour of quarterly reports. The half-yearly exercise is not entirely complete. As I've said before, the quarterly system of reporting puts undue pressure on the management to deliver numbers. This could lead to a tendency to try and do financial engineering. The UK has a six-month reporting system, the US three months. It's been a little premature for India to move to a quarterly system.
The short-term impact: Corporates will re-examine their accounts to see if...