NFRA

Auditing of companies have improved in the last three to four years, NFRA chief Ajay Bhushan Prasad Pandey has said and highlighted the need for board as well as audit committee members to engage with auditors which will help in raising red flags and prevent possible corporate failures. The National Financial Reporting Authority, constituted in October 2018 under the companies law, has passed more than 80 orders, including in Cafe Coffee Day, DHFL and a few other large cases, for lapses that led to corporate failures. At the helm of the watchdog for more than two years, Pandey told PTI in an interview that many of the auditors were doing and are doing a good job. "Overall, auditing of companies has improved over the last 3-4 years," the NFRA Chairperson said. However, he noted that there is a certain section among the auditors and among the board members who were not that sensitive and alert due to which there have been many corporate failures. "People should be aware that these ar

Experts noted that while specific standards on auditing exist for companies, such standards are yet to be notified for LLPs

Ajay Bhushan Pandey says the latest reforms proposed to India's audit standards are historic and long overdue

'Only govt can take final call on audit standards'

For a Viksit Bharat, India cannot afford audit standards that are inferior, NFRA Chairperson Ajay Bhushan Pandey said

The NFRA, after its board meet, has suggested revisions to 40 Standards on Auditing

The meeting will be attended by representatives of the Institute of Chartered Accountants of India (ICAI), which had earlier drafted a Guidance Note on financial statements of LLPs

ICAI feels that given the complexities of the Indian market, the revised standards will concentrate audit work in the hands of a few big firms

National Financial Reporting Authority (NFRA) Chairperson Ajay Bhushan Prasad Pandey on Thursday underscored the need for improving corporate governance and aligning Indian auditing with global standards to attract investors. Observing that there is a need to continue to take cognizance of corporate governance reforms, he said company management, independent directors and audit committee, statutory auditors, shareholders, and regulators constitute five lines of defence to improve corporate governance. "It is our collective responsibility...we should continue to create trust. Improve the corporate governance, and we should work in that direction," he said, addressing an event organised by industry chamber Assocham here. Adopting global auditing standards would improve the trust of global investors in the Indian economy, which is on its way to becoming the third largest from the present fifth position, he said. Making a pitch to align Indian audit practices with the global standards,

NFRA found that the auditors deliberately chose to shy away from their statutory duty to report the fraud and protect the public interest

NFRA Chairperson Ajay Bhushan Prasad Pandey on Tuesday said the regulator's efforts are to incorporate best global standards, which are required for the country to have big homegrown accounting and auditing firms. Amid NFRA and chartered accountants' apex body ICAI having differences over proposed changes to an accounting standard related to group audits, Pandey also flagged that there have been a series of corporate failures in the country and emphasised the need for high-quality reporting and auditing frameworks. Speaking at a webinar on 'Risk-Based Approach of ISQM-1: Building High Quality Audit Firms', Pandey said the desire is to incorporate best global standards. "We cannot create global audit firms without adhering to global standards," he added. ISQM refers to International Standard on Quality Management. He also said there has been a series of corporate failures in the last ten years and the amount involved is around Rs 2 lakh crore, he noted. The National Financial Repo

The NFRA report highlights serious violations of Section 144 of the Companies Act, which bans firms from offering certain non-audit services to their audit clients

The revised standards hold that the group auditor is ultimately responsible for the audit

The National Financial Reporting Authority (NFRA) has slapped penalties totalling Rs 4.5 crore on an audit firm and two auditors for professional misconduct for alleged auditing lapses of Reliance Capital's financials in 2018-19. A fine of Rs 3 crore has been imposed on Pathak H D & Associates, Rs 1 crore on Parimal Kumar Jha and Rs 50 lakh on Vishal D Shah. Besides, Jha and Shah have been debarred from taking up audit work for 10 years and 5 years, respectively, according to an order. Jha was the Engagement Partner (EP) and Shah was the Engagement Quality Control Review (EQCR) Partner for the statutory audit of Reliance Capital for 2018-19 fiscal. For 2018-19, the company was jointly audited by Price Waterhouse & Co LLP (PW) and Pathak HD & Associates. PW reported suspected fraud regarding loans and investments amounting to approximately Rs 12,571 crore to some group companies. In the order dated April 12, the NFRA said that despite the reporting of suspected fraud and ...

The National Financial Reporting Authority (NFRA) has imposed penalties on 18 auditors and also debarred them for varying periods for lapses with respect to audits of various branches of housing finance company DHFL. Penalties totalling Rs 18 lakh or Rs 1 lakh each has been imposed on the auditors for their professional misconduct, according to 18 separate orders passed by the regulator. Also, they have been debarred for a period of six months to one year from "being appointed as an auditor or internal auditor or from undertaking any audit in respect of financial statements or internal audit of the functions and activities of any company or body corporate". Out of the 18 auditors, 4 have been debarred for 6 months and the remaining 14 auditors have been restrained for 1 year. Following media reports of alleged siphoning of public money of around Rs 31,000 crore and the Enforcement Directorate's reported action in April 2020 on an alleged banking fraud of about Rs 3,700 crore by the

The National Financial Reporting Authority has imposed fines totalling Rs 1.10 crore on three entities, including two individual auditors, in connection with lapses in auditing of Tanglin Developments Ltd (TDL), a subsidiary of Coffee Day Enterprises Ltd. Besides, the auditing firm -- Sundaresha & Associates -- and the two auditors -- C Ramesh and Chaitanya G Deshpande -- have been barred from taking up auditing work for varying periods. The case pertains to the diversion of funds worth Rs 3,535 crore from seven subsidiary companies of Coffee Day Enterprises Ltd (CDEL), a listed company, to Mysore Amalgamated Coffee Estate Ltd (MACEL). NFRA has found lapses in auditing of the books of TDL for 2019-20. The regulator said it has taken a stern action against the three entities for professional misconduct and failure to report irregularities in the company's books in 2019-20, despite having access to the details of an investigation that was ordered following the death of the company's

The National Financial Reporting Authority (NFRA) on Friday slapped penalties of Rs 2.15 crore on three entities, including two auditors, besides barring them for varying periods for lapses in the audit of Coffee Day Global Ltd for 2019-20. The case pertains to the diversion of funds worth Rs 3,535 crore from seven subsidiary companies of CDEL to Mysore Amalgamated Coffee Estate Ltd (MACEL). Coffee Day Global Ltd (CDGL) and MACEL are subsidiaries of the listed entity Coffee Day Enterprises Ltd (CDEL). After, markets watchdog Sebi shared its investigation report in April 2022, NFRA initiated investigations into the professional conduct of the statutory auditors of CDGL. In its order, NFRA imposed a penalty of Rs 2 crore on the audit firm ASRMP & Co and Rs 10 lakh on A S Sundaresha. Further, they have been barred for a period of four years and 10 years, respectively. The first two years of the restraint period of ASRMP & Co and the first five years of the prohibition period of ..

Audit regulator the National Financial Reporting Authority (NFRA) has slapped a fine of Rs 1 lakh and a one-year ban on an auditor for alleged professional misconduct in the audit of Anshu's Clothing Ltd for 2015-16. During FY2015-16, Anshu's Clothing's, now known as Aditri Gems & Jewels Ltd, shares were listed on BSE and Metropolitan Stock Exchange. In its order on Thursday, the regulator said it had levied a fine of Rs 1 lakh on Sachin Kansal. He is the proprietor of S Kansal & Associates and statutory auditor of Anshu Clothing for 2015-16. Besides, Sachin was also prohibited for one year from undertaking any audit in respect of financial statements or internal audit of the functions and activities of any company or body corporate during the debarment period, it added. The order came after NFRA received information from the Ministry of Corporate Affairs (MCA) regarding irregularities observed in the financial statements of the company by the Financial Reporting Review Board .

Audit regulator NFRA's chief Ajay Bhushan Prasad Pandey on Friday said auditors should follow the due process and auditing should not be just a "ticking" exercise. Highlighting the importance of financial reporting, he said that audit documentation should speak for themselves. "Audit should not be just ticking audit... It should be thinking audit," Pandey said. The National Financial Reporting Authority (NFRA) chief also said that trust in the reporting system is very important. He was speaking at a conference here organised by industry body Assocham.

The NFRA in a circular has said that it has noticed that auditors are not fulfilling their statutory responsibilities relating to reporting of fraud as required by the Companies Law