Will help govt agencies in large financial-fraud cases
Author : Vivek Seal/DNA
The Institute of Chartered Accountants of India (ICAI) is expecting its serious fraud detection cell to be operational by July to better handle "Satyam like" cases, its top official said.
The cell would help agencies such as Securities and Exchange Board of India and Reserve Bank of India in cracking large financial fraud cases apart from handling its own investigations.
"My people are working on it and by July we expect the launch, the council will decide who will head this. Its objectives, committee, constituents etc would be decided soon," ICAI president Uttam Prakash Agarwal told DNA Money.
The detection cell would be set up on the lines of corporate affairs ministry's Serious Fraud Investigation Office (SFIO) to "fast track" cases.
SFIO, which handles complex fraud cases in corporations, was set up by the government to investigate stock market scams, failure of non-financial banking companies and other financial frauds.
Agarwal said ICAI has communicated to the corporate affairs ministry to grant it authority for restatement of balance sheets if some mistakes are found while auditing the accounts.
"After the recent corporate governance scams, auditors are in urgent need of power to ask for restatement of accounts rather than just giving their qualifications. The matter is with the ministry now and they are considering it, and I believe a decision will come soon," Agarwal said.
Currently, the management has the final word on restating the accounts and auditors are sometimes kept as "recommenders only". Also, ICAI does not have authority to act against auditors who may have indulged in misconduct or fraud if they are not registered members of the institute.
The high-level committee, set up by ICAI to pursue Satyam Computer scandal, is expected to give its decision next month, the official said. Agarwal is chairing the six-member committee, which is investigating the Satyam fraud for ICAI.
Page created on: 5/15/2009 11:27:47 AM