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The Corporate Affairs Ministry (MCA) has given a breather for statutory auditors who were earlier required to file the NFRA-2 form with the National Financial Reporting Authority (NFRA) by November 30.
It has now allowed the form — which specified the format of the Annual return — to be filed with the new independent audit regulator NFRA within 90 days from the day on which it was published on the website of the Authority.
With December 9 as the date on which form NFRA-2 was published on the Web site, auditors will have time till March 9 to file the form, said experts in the audit fraternity.
Part of the reason for extending the timeline was the fact that NFRA came up with the format very late and closer to the November 30 deadline. As the information sought was quite extensive, more time was required and representations were made to the MCA to extend the last date of filing, sources said.
Commenting on the move to extend the timeline, Ashok Haldia, former Secretary, CA Institute, said that NFRA -2 form is fairly comprehensive asking for details for each of the audit and audit qualifications and unfavourable comments, quality control procedure and quality review etc.
“These being asked for the first time, it is bound to take considerable time and effort. Nature of some of the questions suggest that response there against may be analysed and evaluated by NFRA later for corrective as well as punitive measures,” Haldia told BusinessLine .
Amarjit Chopra, former President of the CA Institute, said the MCA move is a right step as adequate time should be given to various firms to furnish the various information. “Its a step in the right direction to provide adequate time to audit firms to furnish information,” he said.
It may be recalled that NFRA — now an independent regulator for auditors of listed companies and large unlisted companies, besides banks and insurers — was constituted by the Central Government for enforcement of auditing standards and ensuring the quality of audits, in order to enhance investor and public confidence in financial disclosures of companies.
NFRA also has oversight of electricity firms and those body corporates referred to it by the Centre.
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