Auditors may have to compulsorily get registered with NFRA
PrintListen to this Article
The Corporate Affairs Ministry has floated an initial draft of the NFRA rules for select stakeholder consultations, two sources who are in the accounting and auditing profession said.
They said the rules are being discussed as part of a consultative process before the final draft is prepared.
The setting up of the NFRA, envisaged under the Companies Act, 2013, was approved by the Cabinet in May this year.
The NFRA would act as an independent regulator for the auditing profession.
According to the proposed rules, auditors have to mandatorily get registered with the NFRA. This would be applicable for auditors of listed firms and other prescribed categories of companies.
The body would have powers to review financial statement of companies, can seek explanations and probe irregularities with respect to accounting and auditing issues.
In case, entities, including individuals, contravene the rules then they could face a fine of up to Rs 10,000. If the entities concerned remain non-compliant, then the penalty would be Rs 1,000 for every day after the first when the violation happened.
The authority would also have powers to recommend accounting and auditing standards.
Another proposal is to restrain the authority or any person associated with it from receiving any funds, assets, donations, favours, gifts or sponsorships from any source other than the Union government.
Besides, the authority would not be permitted to enter into any contract or arrangement that might interfere with its functioning in a fair and reasonable manner, the proposed norms said.
According to a senior auditor, the draft rules have proposed sweeping powers for the NFRA and if implemented, then the role of the chartered accountants' apex body ICAI could be significantly diluted.
The jurisdiction of the NFRA -- which would be an oversight body for auditors -- would extend to all listed companies as well as large unlisted public companies. #casansaar (Source - PTI, Business Standard)
Category : NFRA | Comments : 0 | Hits : 2035
NFRA Imposes Monetary penalty of Rs 1 Crore on M/s Dhiraj & Dheeraj, Chartered Accountants, Mumbai (Firm of Active Central Council Member of ICAI) & Rs 50 Lakhs and 10 Lakh on CA Piyush Patni (Engagement Partner) & CA Pawan Kumar Gupta (Engagement Quality control Review Partner) respectively over Audit Deficiencies in the matter of Statutory Audit of Reliance Home Finance Limited (RHFL). In addition, EP and EQCR partners are debarred for five years and three years respectively fro...
The National Financial Reporting Authority (NFRA) has barred auditors of M/s Brightcom Group for up to ten years and imposed heavy monetary penalties on them, citing professional misconduct in auditing the company between FY20 and FY22. While the audit firm, M/s PCN & Associates, has been prohibited from taking up any audit work for two years, chartered accountant Gopala Krishna Kandula has been barred for ten years, according to a NFRA order on Friday. In another case NFRA Imposed Mon...
The National Financial Reporting Authority (NFRA) has slapped a penalty of Rs 5 lakh on an audit firm for professional misconduct and other lapses in the audit of Vikas WSP Ltd for FY20. Vikas WSP Ltd is a BSE- and NSE-listed company. The order came after NFRA received information from the Securities Exchange Board of India (Sebi), that Vikas WSP Ltd did not recognise in its FY20 financial statements the interest expense on its borrowings from banks, which resulted in overstatement of profits...
National Financial Reporting Authority (NFRA), the regulator for auditors and audit firms for listed and large companies, has acted against Pathak HD & Associates - the joint auditor for Reliance Capital, then an Anil Ambani group company - and its two auditors for multiple failures flagged by the other auditor, Price Waterhouse (PW), which resigned and also flagged suspected fraud of Rs 12,571 crore by the company. Reliance Capital was recently taken over by the Hindujas after several le...
National Financial Reporting Authority (NFRA) chief Ajay Bhushan Prasad Pandey on Wednesday said the agency will assess the feasibility of ranking auditors on qualitative parameters and auditors ranking companies on governance matters. Besides, he said, the agency responsible for assessing auditors or listed and large companies, will work with the Institute of Chartered Accountants of India and corporate affairs ministry about responsibility of auditors around fraud, which is an area of conce...
Comments