Shaken by the alleged “inaction” of Satyam Computer’s auditor Price Waterhouse, the Institute of Chartered Accountants of India is planning to push for a cap on the tenure of a company’s auditor. The institute is also looking into the possibility of issuing guidance to its members on “compulsory verification” if a company’s cash and bank balances exceed a “certain threshold”. Reportedly, Price Waterhouse has been associated with Satyam as an auditor for eight years. While long association helps an auditor know a company inside out, it could also lead to a quid pro quo kind of situation.
CAclubindia
