This could spell some trouble for four of India’s biggest telecom operators. India’s Department of Telecommunications (DoT), has ordered a special financial audit into the books of four telecom operators, including the country’s largest mobile phone service provider Bharti Airtel Ltd. and other big names like Tata Teleservices Ltd., Vodafone-Essar Ltd and Idea Cellular Ltd.
The purpose behind this audit to check these operators’ revenue sharing with the government and to confirm if prescribed revenue sharing norms are being practiced. Telecom service providers in India are required to share between 6% and 10% of their annual revenue as license fees and 2% to 6% of their domestic and international long-distance telephony service revenues.
DoT has decided to appoint special auditors, who will be given up to three months to submit a final report. A similar special audit had earlier been ordered for RCom Ltd., and the auditor’s report is expected later this month. DoT has also ordered that if these operators are found guilty than they would be strictly penalized. The fiscal penalty will depend on the variation in shared revenues.
As of now, these four companies have not spoken to the media and Tata Teleservices and Vodafone-Essar claim to not have yet received an official communication on this matter.