Deloitte Haskins and Sells LLP failed to comply with auditing stds: NFRA on IFIN statutory audit

Flagging concerns, the National Financial Reporting Authority (NFRA) has said that Deloitte Haskins and Sells LLP failed to comply with auditing standards with respect to statutory audit of IL&FS Financial Services Ltd (IFIN), according to an official release.

The NFRA has issued Audit Quality Review (AQR) report of statutory audit conducted for IFIN for 2017-18 period. The statutory audit was carried out by Deloitte Haskins and Sells LLP (DHS).

"The NFRA has concluded in this AQR report that the failure to comply with the standards onauditing are of such significance that DHS did not have adequate justification for issuing theaudit report asserting that the audit was conducted in accordance with the standards on auditing.Besides, the quality control system and processes of DHS were found to be severely inadequateand ineffective," the release said.

This is the first AQR issued by the NFRA since it was set up in 2018. The watchdog comes under the corporate affairs ministry.

As per the release, the NFRA would examine whether disciplinary proceedings needs to be initiated in connection with the AQR report.

The crisis at diversified IL&FS group came to light late last year.