Normally, I try to avoid doing two posts in a row on the same subject, but this is just too amazing, and I fear that it will have profound impacts on the global outsourcing industry.

According to Reuters:

“The company’s [Satyam’s] market value has shrivelled to $330 million (217 million pounds), from more than $7 billion six months ago.”

The story continues:

” admission that profit had been overstated for years and that about $1 billion, or 94 percent of the cash and bank balances on Satyam’s books at end-September, did not exist. …

…at the net level it must have been a loss, which makes it extremely unviable. They have been borrowing to pay salaries, which means they have no cash at all…”

Every time I see another item about this sordid affair, I issue a huge “thanks” that it wasn’t one of our leading Chinese vendors.

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