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Reports: Dewan Housing Finance audit finds gaps in financials, funds diversion

A forensic audit of Dewan Housing Finance Corp. Ltd. found several gaps in the debt-laden company's financials and that billions of rupees worth of funds were diverted to private entities of its promoters, according to separate media reports.

Accounting company KPMG conducted the audit and filed a report to the lenders of DHFL, Mint reported, citing three people directly aware of the matter. The audit was initiated by the lenders of the company in February, the Oct. 22 report added. Separately, online news platform Moneylife reported Oct. 21 that the auditor discovered a diversion of 200 billion rupees of funds to private entities of the promoters.

The findings could pose a risk to DHFL's debt resolution plan, which includes a conversion of bank loans into a 51% equity stake for the lenders, Mint reported. The company could call for a change in management if the findings are proven true.

As of Oct. 21, US$1 was equivalent to 70.89 Indian rupees.