Deloitte To Resign As Adani Ports Auditor Following Differences Over Recording Of Transactions

Deloitte Haskins & Sells has come to a decision to step down from its role as the statutory auditor of Adani Ports and Special Economic Zone Ltd, according to an individual familiar with the matter. The resignation raises concerns about the company’s accounting practices once again. The source, who chose to remain anonymous due to the sensitive nature of the situation, said that an official announcement regarding Deloitte Haskins’ resignation is anticipated in the near future.

The source mentioned that Deloitte Haskins had requested information and clarification, revealing a difference of opinions between the company’s top management and the auditor concerning certain transactions.

This development comes shortly before the impending release of the investigation report on the Adani Group by India’s market regulator. The Supreme Court instructed the Securities and Exchange Board of India (SEBI) to submit its probe findings on the Adani Group’s market dealings involving 13 suspicious foreign portfolio investors by August 14.

Queries sent to representatives from Deloitte and the Adani Group did not elicit any response. Deloitte Haskins, which had been auditing Adani Ports since FY18 and was reappointed as the statutory auditor for a five-year term last year, indicated in the company’s FY23 financial results that there were financing transactions with certain other parties, as mentioned in the Hindenburg report. The group assured Deloitte that these transactions were not with related parties.

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In January, Hindenburg Research, a US-based short-seller, alleged significant corporate misconduct within the Gautam Adani-led group. This development led to a reshuffling of auditors for Adani Group entities in the past few months.

Deloitte’s review of Adani Ports’ interim financials during the June quarter brought attention to a recoverable net balance of ₹3,871 crore owed by a contractor for EPC services, which Adani Ports believed was unrelated. However, the contractor was identified as a related party in the Hindenburg Research report, leading to concerns about the discrepancy. The contractor’s net balance increased by ₹122 crore sequentially in the June 2023 quarter, as stated by Deloitte.

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