* Co posts loss of 33 bln rupees for quarter ended March 2019
* Writes off investment of 65 bln rupees in naval, power arms
* Auditors cast doubt around company’s accounting methodology
MUMBAI, June 17 (Reuters) - Shares in Reliance Infrastructure Ltd closed nearly 5% lower on Monday, after its auditors raised red flags around its latest financial results and cast doubts over the manner in which the firm had accounted for several transactions.
The company, a construction, power and defence conglomerate that is part of business tycoon Anil Ambani’s Reliance Group, late Friday reported a consolidated loss of 33.01 billion rupees ($472.56 million) for the quarter ended March 2019.
The loss was mainly attributed to a 45 billion rupee write-off related to its associate Reliance Naval & Engineering Ltd and a 20 billion rupees impairment booked in Reliance Power, its power generation subsidiary.
Auditors BSR & Co, and Pathak H.D. & Associates pointed out several anomalies and a lack of clarity in instances of related party transactions and accounting methodology.
Losses incurred by the company and subsidiaries and certain loans for which the company is a guarantor show that some “material uncertainty exists that may cast significant doubt on the group’s ability... to continue as a going concern,” according to the auditors’ report posted on the company website.
Reliance Group did not respond to multiple requests for comment on Monday about the concerns raised by the auditors.
Ambani and his companies have lately faced greater scrutiny from auditors and rating agencies, even as bankers and creditors have pressured his firms to pay back dues.
Last week PwC resigned as the auditor of group company Reliance Capital Ltd, saying it did not receive a “satisfactory response” to its queries on certain observations in its assessment of the annual financial results.
$1 = 69.8534 Indian rupees Reporting by Abhirup Roy and Promit Mukherjee; Editing by Rashmi Aich
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