The National Financial Reporting Authority (NFRA) has the power to propose auditing and accounting standards that auditors and companies can adopt. It can also monitor and enforce such policies.
On March 1, 2018, the establishment of the National Financial Reporting Authority was approved by the Union Cabinet. The authority is an independent regulator that will audit or oversee auditors' work under Section 132 of the Companies Act, 2013. The authority is created to establish as well as enforce auditing and accounting standards and oversee the work of auditors.
The Central Government has the power to establish an authority like the National Financial Reporting Authority under Section 132 of the Companies Act, 2013. A proposal to institutionalise the National Advisory Committee on Accounting Standards was also recommended in the Companies Bill, 2009, by a Parliamentary Standing Committee.
One of the prime reasons for the establishment of the National Financial Reporting Authority is the multi-crore fraud that was reported at Punjab National Bank.
Under Section 132 of the Companies Act, 2013, the National Financial Reporting Authority can carry out the following functions:
The National Financial Reporting Authority has a chairperson, a secretary, and 3 full-time members. The following are the powers of the authority:
The role of the Institute of Chartered Accountants in India will remain the same so far as its members are concerned. Its role shall also continue with regards to audits related to public unlisted companies and private limited companies under the threshold limit to be mentioned in the rules. The institute shall maintain its advisory role on auditing and accounting standards and policies by making suggestions and recommendations to the National Financial Reporting Authority.
In case a professional or a firm is guilty of misconduct, he/she shall be at the receiving end of the following penalties:
Credit Card:
Credit Score:
Personal Loan:
Home Loan:
Fixed Deposit:
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