As fiscal year comes to a close, auditors to get advisory amid virus scare

As the fiscal year comes to a close (on March 31), the Institute of Chartered Accountants of India (ICAI) is coming up with guidelines to ensure auditors take into account the disruption caused to firms by the COVID-19 pandemic.

“We will soon be issuing an advisory for auditors... This is a huge challenge for the economy and auditors have to keep it in mind while making reports,” said Atul Gupta, ICAI president.

Auditors will have to account for factors such as slowdown in the supply of perishable goods which will affect the net realisable value. They will also have to take into account any contingent liability arising out of the delay in the delivery of a project owing to COVID-19. 

Another issue that auditors might grapple with is the physical inspection of inventory by March 31.  ICAI will submit its recommendations to the Ministry of Corporate Affairs for approval where this issue is likely to be discussed.