Infosys shares listed in the US market fell close to 16 percent in premarket trading on October 21 after the company said it had received whistleblower complaints alleging "unethical practices" by the company's executives.
Following reports that the Infosys board and the US Securities and Exchange Commission had been sent letters by an anonymous group alleging "unethical" steps by the company to boost short-term revenue and profit, Infosys issued an official statement.
The group had reportedly alleged that Chief Executive Officer Salil Parekh was bypassing reviews and approvals for large deals, as per an Economic Times report.
"In large contracts like Verizon, Intel, JVs in Japan, ABN AMRO acquisition, revenue recognition matters are forced, which are not as per accounting standards," the report said, citing cited the letters.
Reuters was not able to independently review the letters.
The complaints follow a strong quarterly show by Infosys, which raised the lower end of its annual revenue forecast on upbeat demand for its digital services from Western clients.
"(The complaints) have been placed before the audit committee as per the company's practice and will be dealt with in accordance with the company's whistleblower policy," Infosys said in a filing to Indian stock exchanges.
ADRs of Infosys were down 15.7% at $8.91 in premarket trading on the New York Stock Exchange. Indian markets were closed on Monday for a holiday.
Discover the latest business news, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
