Updated By: LatestGKGS Desk
National Financial Reporting Authority (NFRA) to ensure fair audits
Union Cabinet Approved National Financial Reporting Authority (NFRA) – Details, Features, Purpose, Benefits
The Union Cabinet chaired by Prime Minister has approved the proposal for setting up of the independent regulator National Financial Reporting Authority (NFRA) on 1st March 2018 in New Delhi.
The National Financial Reporting Authority (NFRA) will have 15 members and have inclusive powers to act against misguiding auditors and auditing firms.
The Union Cabinet decision was made in wake of the increasing banking sector’s frauds/scams including the PNB fraud of over Rs 12,700 crore.
Instituting NFRA is believed to result in improved foreign/domestic investments, enhancement of economic growth, supporting the globalisation of business by meeting international practices, and assist in further development of audit profession.
The Union Cabinet has also approved the creation of the post of Chairperson, three posts of full-time Members and one post of Secretary for NFRA, which has been authorised to investigate Chartered Accountants (CAs) and their firms under section 132 of the Companies Act, 2013.
The Act allows NFRA to investigate matters of professional misconduct by CAs or CA firms, impose the penalty and debar such CAs or firms for up to 10 years.
