New Delhi: Markets regulator Sebi on Monday imposed penalties totalling Rs 38 lakh on Coffee Day Enterprises Ltd and several of its officials for failing to comply with mandatory accounting and disclosure requirements while preparing financial statements.
In its order, Sebi observed that the company did not adhere to Indian Accounting Standards (Ind AS) in the preparation and presentation of its standalone and consolidated financial statements, as well as quarterly financial results.
The regulator also noted that the company failed to disclose the reasons for deviations from prescribed accounting standards, as mandated under the Companies Act, 2013.
A key violation pertained to the non-recognition of interest cost on borrowings in both standalone and consolidated financial statements for four financial years – FY21, FY22, FY23 and FY24. The lapse also extended to quarterly results from the quarter ended March 31, 2021 (Q4 FY21) through September 30, 2024 (Q2 FY25), covering 15 quarters.
The regulator stated that the company was required to make disclosures strictly in accordance with extant legal provisions and not based on its own interpretation of accounting norms, which ultimately led to the interest expenses not being accounted for during the investigation period.
As per the order, Sebi imposed a penalty of Rs 10 lakh on Coffee Day Enterprises Ltd. Among the officials, Rs 5 lakh each was levied on Malavika Hegde, S V Ranganath, and K R Mohan, Independent Director, Rs 3 lakh each on C H Vasundhara Devi, Giri Devnur, and on I R Ravish; Rs 2 lakh on Ram Mohan, Rs 1 lakh each on Sadananda Poojary and Albert Hieronimus, the order noted. agencies
