Anil Calls Special Auditor Biased; Mukesh Lowers His Salary

Reliance Communications (RCom) Chairman Anil Ambani has claimed as “biased” the special audit report which alleges overstatement of revenues and evasion of license fee by RCom as big brother Mukesh Ambani decides to lower his pay package amid ongoing debate on CEOs ‘vulgar salary’.

Anil said that he would take the issue with the Telecom Ministry and insisted that an investigation should be initiated by market regulator Sebi into the hammering of RCom scrip in the last few days.

He stated that RCom was on its own declaring all the information relating to revenues to the government and telecom regulator Trai and would pay the government whatever legitimately is due. He has been under attack for alleged overstatement of revenue by about Rs 3,000 crore and evasion of license fee of over Rs 300 crore.

The accounting controversy broke out after the leakage of a report by Parakh & Co, a government appointed auditor, earlier this week leading to RCom shares slumping sharply.

In the meanwhile, Reliance Industries on Thursday said its chief Mukesh Ambani has decided to lower his pay package by nearly two-thirds to Rs 15 crore for 2008-09.

At the same time, Reliance Industries also announced a new structure for salaries and remuneration of top executives in which packages would be capped, as against the prevailing system of commission linked to profits.

Following scaling down of package, Mukesh Ambani would now receive a salary markedly less than many other industrialists and executives heading companies with a size less than one-tenth of RIL.

It should be noted that the development comes amid debate on whether or not there should be regulation on salaries of CEOs following suggestions by Corporate Affairs Minister Salman Khursheed. The Minister had, however, felt that Boards and shareholders should decide the packages.

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