Consumer electronics maker BoAt, which is preparing for an initial public offering (IPO), said the information it shared with banks did not match its internal records. It highlighted several instances of mismatch between the statements or quarterly returns it submitted to lenders and their books of account, as mentioned in its updated draft prospectus.

Imagine Marketing, BoAt’s parent company, revealed that auditors had flagged several “unfavorable observations and observations” over the years. The mismatch corresponded to fiscal years 2023, 2024 and 2025. Auditors raised concerns about the use of funds for purposes other than those for which they were intended.

The company’s IPO prospectus has also come under intense scrutiny on social media with questions about undisclosed transactions that were made at Singapore-based subsidiary Kaha Pte Ltd through another unit or excess remuneration paid to its directors in the 2023 financial year.

“What’s wrong with many startups going public? They need to set standards and not do funny accounting,” Mohandas Pai criticized.

The company said it has taken steps to rectify some of the observations, including “obtaining a waiver, through a shareholder resolution, of the excess remuneration paid to our company’s directors and ensuring that accurate current year numbers are reported to minimize differences between books and returns.”

Meanwhile, co-founder and face of the company, Aman Gupta, has been moved to non-executive director, while Imagine Marketing co-founder and CEO, Sameer Mehta, has been moved to the role of executive director.