CA body's panel to review audit of Gensol, BluSmart

Mumbai/New Delhi: The key panel of the Institute of Chartered Accountants of India (ICAI) will review the financial statements and statutory auditor's report of Gensol Engineering and BluSmart Mobility for 2023-24. The move comes even as BluSmart, the troubled startup, brought in Grant Thornton for a forensic audit, sources aware of the discussions said.

The developments followed a Sebi probe that revealed company's promoters, Anmol Singh Jaggi and Puneet Singh Jaggi, diverted funds raised for buying electric vehicles for personal expenses. "Talks of getting an external auditor already started after BluSmart defaulted on NCDs (non-convertible debentures) earlier this year, but the process got fast-tracked after the Sebi investigation," a source said. A mail sent to Grant Thornton did not elicit any response, and BluSmart did not comment.

Sources indicated that Grant Thornton is likely to launch a full financial audit of BluSmart's books and inspect the flow of funds and cash position of the company. Once seen as a competitor to Ola and Uber, BluSmart suspended operations last week. BP Ventures, the company's largest external investor, did not comment on the development but said it is monitoring the ongoing situation closely, in relation to its minority investment in BluSmart. "BP Ventures remains committed to its investments in India and continues to evaluate new investments in the region that reflect BP's strategy," the company said in a statement. BP Ventures holds around a 14% stake in the startup.

The ministry of corporate affairs is already looking into the issue and now ICAI has waded in with the institute's president Charanjot Singh Nanda initiating action suo motu. Sources said institute's Financial Reporting Review Board (FRRB) has been tasked with undertaking the review. The board reviews the general-purpose financial statements of various enterprises and auditors' reports to determine compliance with the generally accepted accounting principles, the disclosure requirements, as well as reporting obligations applicable to them. Based on the review, it can refer cases for disciplinary action.

KC Parikh & Co were the statutory auditors for Gensol.