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The National Financial Reporting Authority (NFRA) has taken decisive action against alleged misconduct, debarring two Chartered Accountants (CAs) for a period ranging between 5 to 10 years. Additionally, an audit firm, M/s Pathak, H.D. Associates, has been slapped with a hefty fine of up to ₹3 crore. This stringent action stems from a financial transaction involving Reliance Capital, a matter of considerable public interest due to its listed status. NFRAs order, dated April 12, imposes monet
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FAQ :
The NFRA has debarred two Chartered Accountants for 5 to 10 years and imposed a fine of up to ₹3 crore on the audit firm M/s Pathak, H.D. & Associates.
The action is due to alleged misconduct and lapses in the audit of Reliance Capital for the fiscal year 2018-19, including failure to exercise professional skepticism and due diligence.
The Engagement Partner, CA Parimal Kumar Jha, has been debarred for 10 years, and the Engagement Quality Control Review Partner, CA Vishal D Shah, has been debarred for 5 years.
The audit firm, M/s Pathak, H.D. & Associates, has been fined ₹3 crore.
During the fiscal year 2018-19, Reliance Capital reportedly had substantial loans from banks and other external borrowings totaling ₹44,000 crore.
NFRA found that the auditors rationalised questionable practices, disregarded accounting and auditing standards, and exhibited recklessness and unprofessionalism, leading to material misstatements.
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