The Public Company Accounting Oversight Board recently barred two auditors in India from working in U.S. capital markets when they declined to cooperate with a PCAOB investigation of audit work related to Satyam Computer Services.

Siva Prasad Pulavarthi and Chintapatla Ravindernath, both accountants with Lovelock & Lewes in India, have been barred from being associated with any firm registered with the PCAOB to perform audits on companies listed on U.S. stock exchanges. Both accountants resigned from Lovelock & Lewes in late January, according to the PCAOB orders against each one.

The PCAOB said it issued demands requiring testimony from both auditors in connection with their role in audits of Satyam financial statements. Satyam is the India-based consulting and IT services provider caught in a $1 billion fraud scheme uncovered in early 2009. It touched off concerns about whether Satyam’s problems with its own financial reporting could spill over to affect the financial reporting of companies that had relied on Satyam for key data services.

Lovelock is one of five members of the PricewaterhouseCoopers network of firms that is located in India and registered with the PCAOB. Lovelock participated in the audits of the 2005, 2006, 2007, and 2008 financial statements of Satyam, according to the PCAOB. The board said the two sanctioned auditors each served at different times as engagement manager for the Satyam audit, so the PCAOB called on both to testify as part of an investigation of audits for Satyam. PwC is the firm that signed off on Satyam's audit reports, according to the PCAOB.

The board said it scheduled and rescheduled testimony for both auditors in 2009 to accommodate their demands about time, location, and changes in legal counsel before both auditors ultimately determined in January 2010 they would not testify at all. As such, both have been barred from being associated with a firm that is registered with the PCAOB.