NFRA

Don't mistake AI's fluency for accuracy, warns NFRA chairman

The National Financial Reporting Authority (NFRA) is looking into the revenue misstatements case at Rajesh Exports, but it will not be possible to share a timeline on the probe, a top official at the auditors' watchdog said on Tuesday. "Yes, we have started our processes," NFRA chairperson Nitin Gupta said on the sidelines of an event organised by Ficci here. He declined to share any observations, saying the matter is not with him, and also a timeline by which the probe will be completed. It can be noted that last month, capital markets regulator Sebi issued an order in which Rajesh Exports was found to have indulged in misstating revenues over a long period, pegging the overall discrepancies at Rs 15.5 lakh crore. As per subsequent reports, Sebi had written to NFRA seeking examination of the errant entity's auditors. Gupta on Tuesday called for genuine board independence in India's promoter-driven companies, pointing out that as AI influences corporate decision-making, a critical

Low audit fees, firm bias, technology gaps and regulatory hurdles continue to limit the scale and competitiveness of India's domestic audit firms

A Parliamentary panel has suggested that regulator NFRA conduct sectoral studies to identify industry-specific accounting and auditing challenges as well as put in place sector-specific accounting guidance to help boost investor confidence. The National Financial Reporting Authority (NFRA), set up by the government in 2018 under the Companies Act, 2013, regulates auditors and monitors compliance with accounting and auditing standards by companies. It also oversees the quality of audit services to ensure reliability in financial reporting. In a report tabled in the Lok Sabha on Thursday on the corporate affairs ministry's demand for grants 2026-27, the Standing Committee on Finance has made certain recommendations in relation to the NFRA. According to the report, the corporate affairs ministry should take expeditious steps to operationalise the separation between audit quality review and disciplinary functions within the NFRA to strengthen procedural clarity, institutional independen

The NFRA had received a complaint about accounting lapses in the IndusInd Bank through the Centralised Public Grievance Redress and Monitoring System

Pandey says audit firms have taken corrective steps following the regulator's inspections, which are among the pivots the organisation is working on

The National Financial Reporting Authority (NFRA) has flagged certain lapses in the audit quality of three audit firms. The observations have been made in NFRA's three separate inspection reports of SRBC & Co LLP, Deloitte Haskins & Sells LLP and Walker Chandiok & Co LLP. In its report on SRBC & Co LLP, the regulator conducted audit quality inspections in 2024 and the scope included focus on three audit areas -- Internal financial control over financial reporting on revenue, related party transactions and impairment of non-financial assets. SRBC & Co LLP is member of two networks -- Ernst & Young Global network and SR Batliboi & Affiliates. According to the regulator, SRBC & Co LLP should put in place a robust process to address all threats to independence, which may be created due to the exclusion of certain services from the term non-audit services. Further, the audit firm should reconsider its policy to exclude NFRA-regulated audit clients' holding ..

Court order pertains to quashing NFRA's 11 show cause notices to multiple auditors and CAs

To enhance the quality and the level of interactions between auditors and companies' audit committees, NFRA chief Ajay Bhushan Prasad Pandey has said the watchdog plans to come out with six to seven papers having sets of questions that will cover various aspects of statutory audits. "The papers will also help the stakeholders in asking the right questions related to audits," he told PTI. Constituted in October 2018, the National Financial Reporting Authority (NFRA) has been making efforts to improve audit quality and has passed over 80 orders against various entities for auditing lapses. "These papers will also act as a guidance for companies' audit committees, independent directors, and board of directors in understanding the nuances as well as critical aspects of auditing," the NFRA Chairperson said. In the planned series, the first paper on 'Audit of Accounting Estimates and Judgments Part 1: Expected Credit Losses (ECL) under Ind AS 109' was issued on January 10. "NFRA plans t

NFRA found that ZEEL had misappropriated its money and made unauthorised transactions with related parties without the approval of the audit committee, the board, and shareholders

Auditing of companies have improved in the last three to four years, NFRA chief Ajay Bhushan Prasad Pandey has said and highlighted the need for board as well as audit committee members to engage with auditors which will help in raising red flags and prevent possible corporate failures. The National Financial Reporting Authority, constituted in October 2018 under the companies law, has passed more than 80 orders, including in Cafe Coffee Day, DHFL and a few other large cases, for lapses that led to corporate failures. At the helm of the watchdog for more than two years, Pandey told PTI in an interview that many of the auditors were doing and are doing a good job. "Overall, auditing of companies has improved over the last 3-4 years," the NFRA Chairperson said. However, he noted that there is a certain section among the auditors and among the board members who were not that sensitive and alert due to which there have been many corporate failures. "People should be aware that these ar

Experts noted that while specific standards on auditing exist for companies, such standards are yet to be notified for LLPs

Ajay Bhushan Pandey says the latest reforms proposed to India's audit standards are historic and long overdue

'Only govt can take final call on audit standards'

For a Viksit Bharat, India cannot afford audit standards that are inferior, NFRA Chairperson Ajay Bhushan Pandey said

The NFRA, after its board meet, has suggested revisions to 40 Standards on Auditing

The meeting will be attended by representatives of the Institute of Chartered Accountants of India (ICAI), which had earlier drafted a Guidance Note on financial statements of LLPs

ICAI feels that given the complexities of the Indian market, the revised standards will concentrate audit work in the hands of a few big firms

National Financial Reporting Authority (NFRA) Chairperson Ajay Bhushan Prasad Pandey on Thursday underscored the need for improving corporate governance and aligning Indian auditing with global standards to attract investors. Observing that there is a need to continue to take cognizance of corporate governance reforms, he said company management, independent directors and audit committee, statutory auditors, shareholders, and regulators constitute five lines of defence to improve corporate governance. "It is our collective responsibility...we should continue to create trust. Improve the corporate governance, and we should work in that direction," he said, addressing an event organised by industry chamber Assocham here. Adopting global auditing standards would improve the trust of global investors in the Indian economy, which is on its way to becoming the third largest from the present fifth position, he said. Making a pitch to align Indian audit practices with the global standards,

NFRA found that the auditors deliberately chose to shy away from their statutory duty to report the fraud and protect the public interest