CFO Magazine
March 01, 2009
"No Way Out?"
By Sarah Johnson
Pace Harmon Partner David Rutchik recaps the Satyam scandal and its impacts on the overall outsourcing industry and Satyam customers. "I wouldn't want to be a CFO who tells my board that Satyam was running our accounts receivable and now it's running out of cash. Even the most rigorous due diligence may fail to detect certain kinds of problems. If you look at the WorldCom, Enron, and Madoff scandals, there is no way to completely protect oneself against individual fraud," Rutchik admits…Hard to obtain but worth exploring, says Rutchik, are surety bonds or letters of credit posted by a vendor's parent company that back the future performance of its subsidiary. Post-Satyam, he predicts they will be easier to come by.
Pace Harmon’s insights regarding technology trends, complex transactions, and supplier management issues are frequently quoted in leading industry journals.
