Callmate Telips Telecom Limited (Callmate) was in the telecommunications business, an industry in which the regulatory controls were slowly being reversed by the government of Pakistan as part of an economic deregulation plan. Callmate was the pioneer in the payphones and prepaid calling card industries in Pakistan. The occasions in the case illustrate the business strategy, along with competitive share price management, could be dangerous if there were no checks on the managers. All the directors of Callmate were close relatives and the audit committee consisted of three of the managers.
After Ferguson had reviewed these it was required to print its financials quarterly as Callmate was listed on the Karachi Stock Exchange. The company had received permission during early 1995 to enter into the long distance international marketplace. A disagreement arose between the business and the auditors on the accounting policy related to revenue recognition. This dispute, along with the company attempting to handle its share price, caused a number of problems that became public knowledge as the business attempted to malign the auditors. Corporate governance is examined by the case by examining the conduct of the board of directors, the role of the outside auditor and the regulator of publicly listed firms.
PUBLICATION DATE: April 23, 2009 PRODUCT #: 909N08-HCB-ENG
This is just an excerpt. This case is about FINANCE & ACCOUNTING
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