JSW Steel denies Credit Suisse charge; says accounts intact : Money control

In response to Credit Suisse’s accusations, JSW Steel on Friday came out and said that they strongly object to the statements made by the brokerage firm, reports CNBC-TV18’s Kritika Saxena. Last week, Credit Suisse has released a statement which claimed that JSW Steel had under stated FY12 debt by around Rs 11,900 crore. As per Credit Suisse, the overall debt comes up to around Rs 28,500 crore, a fat amount considering the reported amount is Rs 16,600. Credit Suisse bases these accusations on three points; one is that acceptances have gone up and that hasn’t been factored in by the company. 

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It says that foreign currency acceptances have gone up significantly to around USD 1.5 billion from USD 1.2 billion, and that these have been mentioned under accounts payable instead of under debt. Aside from that another important point is that securitised receivables have gone up by 19% to Rs 3100 crore. Credit Suisse says the receivables should have been adjusted when comparing the net debt and mentioned within the financial disclosures. Aside from that, the last point is that the company’s unhedged position of dollar liabilities is close to USD 3 billion, again not mentioned. JSW Steel’s refuted these statements, saying that they are misleading statements. They said that their ‘financial statements have been audited by reputed chartered accountants and adhere to the Indian GAAP principles’. They also said that they have prepared annual financial statements in accordance with the principles that have been presented to them. They also point out that the FY12 balance sheet is in conformity with the revised Schedule VI of Companies Act, 1956. They also go on to indicate that classification of assets and liabilities in the financial statement is what has been in practice by the company over the last several years.