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NFRA Consultation Paper: ICAI has ‘serious concerns’, says President Jambusaria

K.R.Srivats New Delhi | Updated on July 27, 2021

CA Institute writes to Corporate Affairs Ministry expressing concern over NFRA consultation paper’s overreach

The CA Institute and the National Financial Reporting Authority (NFRA), the new audit regulator of auditors of listed and large companies, are not on the same page when it came to the recently issued NFRA consultation paper.

The Institute of Chartered Accountants of India (ICAI) has conveyed to the government its serious concerns on the fundamental viability of the report of the Technical Advisory Committee (TAC) of NFRA and in turn the consultation paper issued on this report, Nihar Jambusaria, President, ICAI, has said.

Speaking to BusinessLine on the NFRA consultation paper, which is open for stakeholders comments till July 30, Jambusaria said the consultation paper travels beyond what is permitted by NFRA Rules.

He highlighted that the consultation paper was issued without consulting ICAI as regards the factual accuracy of the audit matters. The report of TAC contains charges on all the stakeholders viz auditors, preparers, management, regulators and the government, he added.

“ICAI discussed the consultation paper issued by NFRA and has reservations with regard to comments made in the Consultation Paper and the report of TAC. We have conveyed our serious reservations in our letter to the Corporate Affairs Ministry,” Jambusaria said.

He said the TAC report issued without consulting the NFRA Board members and the ICAI will have a negative impact on the overall image of the nation.

“It will affect the investment opportunities in the country, India’s rating and also perception of the world about ease of doing business in India,” Jambusaria said.

He also said the consultation paper also mentioned NFRA as the sole regulator for accounting and auditing profession. “However, we would like to clarify that ICAI was set up under an Act of Parliament way back in 1949 and as per the Chartered Accountants Act 1949 —“It is an Act to make provision for regulation of the profession of Chartered Accountants,” Jambusaria said.

Published on July 27, 2021

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