Auditors to Jet Airways, the country's largest carrier, have warned that the company needs to raise money in order to meet its obligations and fund JetLite, its loss-making subsidiary whose net worth has already been eroded. 

Deloitte Haskins & Sells and Chaturvedi & Shah have also said raising money is critical if the company's accounts have to be prepared on a "going concern basis" in the future. 

"The appropriateness of assumption of going concern is dependant upon the company's ability to raise requisite finance or generate cash flows in future to meet its obligations, including financial support to its subsidiary," the auditors have said in a note to the company. 

The note was written on November 11, the day Jet announced its September quarter earnings, and is signed by RD Kamat, partner at Deloitte, and Parag D Mehta, partner at Chaturvedi & Shah. The letter was released to the stock exchange on Monday by Jet. 

Going concern is an accounting concept under which accounts are prepared on the assumption that the company is likely to continue operations for an indefinite period. Any doubts or qualification from the auditor about the company's going concern status is, therefore, likely to spook investors and cause concern over its viability. 

Jet said it is confident of getting equity soon. It plans to raise $300 million in sale and leaseback of 40 aircraft owned by the company. "We are in talks with leasing companies and are close to finalising sale and leaseback for the aircraft that are owned by Jet," said M Shivkumar, senior VP, finance, Jet Airways. 

ET