Accounting watchdog Institute of Chartered Accountants ofIndia (ICAI) has said that strict action could be taken against Reebok India’s former Chief Financial Officer Vishnu Bhagat if he doesn’t comply and respond to the showcause notice regarding the alleged fraud at the sportswear maker. ICAI had issued showcause notice to Bhagat, who sought time till March 31 to respond. But ICAI is yet to receive the same.
German sportswear giant Adidas’s balance sheet for 2011 is negatively impacted by 153 million euros (over Rs 1,090 crores) owing to ‘commercial irregularities’ at its Reebok India arm. Caught amidst the alleged Rs 850 crores fraud by its former MD Subhinder Singh Prem and COO Vishnu Bhagat, made public by the Adidas last April and unhappy Reebok franchises, German sports major Adidas, which acquired Reebok in 2006, recently brought a new managing director, Erick Haskell on board to revive the brand in India. But media reports suggest that the Reebok brand might make an exit from the country given the current circumstances.