Letters to the Editor dated March 16, 2020

This refers to the editorial ‘Towards ‘Coronanomics’’ (March 16). The coronavirus pandemic has lowered the confidence and trust in the economy, and is pushing the ongoing slowdown towards recession. The economic stimulus executed by the government is not enough to steer economic activity upward. In addition, virus fears are inhibiting people from mobility, which in turn is forcing in the withdrawal and or shutdown of various economic activities. Intensifying the actions to contain and prevent the further spread of the coronavirus is paramount.

In the meantime, eliminating the fear of the pandemic is warranted to compel people to comply with the preventive measures. Without compromising on the strict safety measures, the government needs to execute more economic and financial stimulus packages to push the growth of manufacturing, trade and commerce to augment job opportunities. Liberalised credit expansion at a lesser cost by banks is vital to the growth of investment and consumption. The banking regulator should extend more forbearance in lending norms to core sectors to maintain the uninterrupted flow of funds, besides relaxing allowing the income recognition and asset classification norms until the economy recovers.

Kottayam

This refers to ‘Data Protection Bill is vague and intrusive’ (March 16). Since we are living in a constantly evolving world wherein technology is so integral, data protection is a highly sensitive matter. When the size of data in next just two years is going to be 40 times more than what it is today, we can just imagine the sheer complexity of the task at our government’s hands. As Digital India is a pet project of Prime Minister Narendra Modi and digital economy is being pushed to a new level, it is paramount that boundaries between personal and non-personal data not be blurred. Indeed, personal data is everywhere, so it would be great if there is a clear and identifiable difference between personal and non-personal data so that there is no ambiguity and suspicion in the minds of general public. It is good to study European Union’s GDPR and align with international framework in this regard, but simultaneously, our government must strengthen its cyber law in the face of growing cyber .

Noida

Apropos ‘Auditing the auditors’ (March 16). To check the repeated business failures that were caused mostly due to corporate frauds and criminal breach of trust, MCA choseto revise the Companies (Auditors’ Report) Order. Let’s accept that the new CARO requirements specifically cover such issues that were reported to have largely contributed to the collapse of companies like IL&FS and PMC Bank.

Rightly so, the RBI has flagged that “highly irregular credit management practices, serious deficiencies in governance and poor compliance culture,” compounded the YES Bank crisis.

If so, what prevented the auditors to bring forth these shortcomings, which were prevalent since 2017?

Realistically, an audit in today’s ever-changing economic environment should rely more on analytical review than on substantive testing. That audit fee is paid by the company concerned should not be cited as a factor to escape bearing the additional audit burden.

The CARO is just indicative and can’t even be exhaustive, as analysts and specialists want to know about the professional judgment applied by the auditors to deal with unusual situations within the framework of applicable standards.

Ideally, the ICAI shouldn’t intervene, and the audit fee shouldbe decided jointly by the payer and payee.

Gurugram

This is with reference to ‘Covid-19:Modi proposes emergency SAARC fund; India to contribute $10 m’ (March 16). The move to call for cooperation among all countries in the SAARC region to combat coronovirus, is a right one. The Prime Minister’s proposal to create a Covid-19 emergency fund is also pragmatic. The creation of a research platform to control epidemic diseases in the region shows Modi’s commitment to curb the medical crisis caused by the virus. Above all, the cooperation of the SAARC members for creating a common platform to combat the virus is laudable. At the global level, too, such organisations must take similar steps to fight the virus.

Sivakasi

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