SUMMARY
One97 Communications has appointed SR Batliboi & Associates as the B2B vertical’s new auditor with immediate effect
Paytm said the outgoing auditor has not raised any concern or issue with its B2B arm
PwC said its resignation was considering One97’s ‘understandable practice’ to align the auditor of PPSL, being a material subsidiary, with the auditor of the holding company
PricewaterhouseCoopers (PwC) India resigned as the auditor of paytm
Payments Services on Monday (August 7). The fintech major has appointed SR Batliboi & Associates as the auditor of the B2B vertical with immediate effect.
“… we wish to inform you that M/s.Price Waterhouse Chartered Accountants LLP… statutory auditors of material subsidiary i.e. Paytm Payments Services Limited (PPSL) have resigned with effect from August 07, 2023,” Paytm said in a regulatory filing with the bourses.
Paytm Payments Services, a wholly-owned subsidiary of One97 Communications, offers digital payments solutions and tools for businesses.
Paytm said that the outgoing auditor has not raised any concern or issue with its B2B arm, and the resignation of PwC was approved by the company’s board of directors.
The decision comes a week after Paytm informed PwC India that there was a change of auditors at the board level. In its resignation letter to the fintech major, PwC India said that the resignation was necessitated by Paytm’s ‘understandable practice’ to align the auditor of PPSL with the auditor of the holding company’.
“…Consequently, keeping in mind your understandable practice to align the auditor of PPSL, being a material subsidiary, with the auditor of the holding company in order to bring in synergies and maintain consistency in the audit process of the Group, we hereby tender our resignation as the statutory auditors of PPSL,” said PwC India in its resignation letter.
PwC furnished financial statements for the year ended March 2023 and a limited review report on the ‘unaudited special purpose interim condensed financial statements’ for the first quarter of financial year 2023-24 (FY24) prior to its resignation.
PwC India was appointed by PPSL as its auditor at its annual general meeting (AGM) held in September 2021. The auditor was appointed for a period of five years till FY26 but its journey was cut short due to considerations around ‘consistencies in the audit process’.
PPSL was incorporated as a subsidiary of Paytm in the later half of 2020. PPSL acquired a persona of its own after Paytm transferred its online payment aggregation business to PPSL in 2021. It, however, ran into controversy in 2022 after the Reserve Bank of India (RBI) asked it to reapply for a payment aggregator licence. Since then, PPSL has introduced sweeping changes while chasing the central bank for the payment aggregator licence to onboard more merchants on its rolls.
The latest development came on the same day as the fintech giant announced that its CEO Vijay Shekhar Sharma would acquire a 10.3% stake in the company from the Netherlands-based Antfin Holdings BV, an arm of Chinese conglomerate Ant Group.
The development comes at a time when Paytm has rapidly scaled its loan business and merchants payments verticals. It has also been cutting its losses by focussing on profitability and shoring up its revenue. Paytm’s consolidated net loss narrowed to INR 358.4 Cr in Q1 FY24 compared to INR 645.4 Cr in Q1 FY23.
Paytm shares closed 6.95% higher at INR 850.75 on the BSE on Monday (August 7).
