National Financial Reporting Authority (NFRA) is an independent regulator set up to oversee the auditing profession and the
Indian Accounting Standards under the
Companies Act 2013. It came into existence in October 2018. The chairperson since March 2022 is
Ajay Bhushan Pandey.
[https://www.google.com//timesofindia.com/business/india-business/govt-appoints-ex-finance-secretary-ajay-bhushan-pandey-as-nfra-chief/amp_articleshow/90132847.cms]
History
After the
Satyam scandal
The Satyam Computer Services scandal was India's largest corporate fraud until 2010. The founder and directors of India-based outsourcing company Satyam Computer Services, falsified the accounts, inflated the share price, and stole large sums f ...
took place in 2009, the Standing Committee on Finance proposed the concept of the National Financial Reporting Authority (NFRA) for the first time in its 21st report.
, then gave the regulatory framework for its composition and constitution. The Union Cabinet approved the proposal for its establishment on 1 March 2018. It is hoped that the establishment of NFRA as an independent regulator for the auditing profession will improve the transparency and reliability of financial statements and information presented by listed companies and large unlisted companies in India.
Powers & duties
According to Section 132 of the Companies Act 2013, "NFRA is responsible for recommending accounting and auditing policies and standards in the country, undertaking investigations, and imposing sanctions against defaulting auditors and audit firms in the form of monetary penalties and debarment from practice for up to 10 years."
[
Pursuant to th]
NFRA Rules, 2018
the powers of the NFRA were extended to include the governing of auditors of companies listed in any stock exchange, in India or outside of India, unlisted public companies above certain thresholds, and other companies specified in Rule 3 (1) therein.
Rules 7 and 8 allow for the monitoring of accounting and auditing professionals of the companies referred to in Rule 3 (1).
Companies under Rule 3 (2) and 3 (3) are required to disclose information of their auditors to the NFRA through form NFRA-1.
See also
* Public Company Accounting Oversight Board (PCAOB)
References
External links
Official website
Standards organisations in India
Financial reporting
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