Money & Banking

NFRA Chief’s term ends on Thursday; no clarity yet on successor, second term

KR Srivats New Delhi | Updated on September 28, 2021

R Sridharan, NFRA Chairperson

Sridharan was appointed as Chairperson on October 1, 2018 for three-year period

National Financial Reporting Authority (NFRA) Chairperson Rangachari Sridharan is expected to demit office on Thursday with his three-year tenure coming to an end on September 30. There is still no clarity on whether he will get reappointed although the rules provide for such a step, official sources said.

The “competent authority” is yet to take the final call, they added, noting that the matter has to go to the Appointments Committee of the Cabinet (ACC) for approval. Over 70 persons including bureaucrats, chartered accountants and retired judges have applied for the post, it is learnt.

It may also be noted that the search-cum-selection committee is free to identify and recommend any person also, based on merit, who has not applied for the post.

Going by what had happened recently in the case of appointments of top officials of Income Tax Appellate Tribunal or the National Company Law Appellate Tribunal, there can always be last minute twists and turns in such appointments, say economy watchers.

Audit quality reviews

In his role as the first Chairperson of NFRA, Sridharan, who had an eventful three-year tenure since October 1, 2018, sought to build NFRA as an independent audit regulator from scratch. Despite challenges around staffing and office infrastructure, he helped devise NFRA’s own process for Audit Quality Review and even created an internal manual.

As many as three Audit Quality Review Reports on statutory audits of three scam ridden entities — IL& FS Financial Services , Jaiprakash Associates and IL& FS Transportation Networks — were issued by NFRA in the three year period. During his tenure, Sridharan had several run-ins with the Institute of Chartered Accountants of India, some of whose members he had pulled up in the three AQRs named above. The ICAI is completely opposed to NFRA’s existence.

Meanwhile, MS Sahoo, Chairperson of insolvency regulator IBBI, is also due to demit office on Thursday after a five-year stint at the helm. Sahoo has already conveyed to the government that he would be unavailable for reappointment.

Published on September 27, 2021

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