Quick Summary
The National Financial Reporting Authority (NFRA) Chairperson, Ajay Bhushan Prasad Pandey, emphasized the urgent need for India to align its auditing standards with global benchmarks to bolster investor confidence, attract funds, and enhance the credibility of financial data. Pandey underlined that achieving a "Viksit Bharat" (developed India) demands world-class auditing standards, stating, "We cannot have inferior standards." Established in October 2018 under the Companies Act, NFRA has issue
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FAQ :
NFRA wants to align India's auditing standards with global benchmarks to boost investor confidence, attract funds, and enhance the credibility of financial data, which is essential for achieving 'Viksit Bharat'.
Certain standards, such as SA 600 (group company audits) and SA 299 (joint auditor liability), significantly deviate from international norms and require updates to address existing loopholes.
Aligning with global standards will improve the reliability of financial reporting, increase investors' confidence, and make India a more attractive destination for foreign investments.
NFRA is using a five-pronged approach: capacity development for auditors, issuing disciplinary orders, conducting inspections, aligning standards with international norms, and leveraging technology.
Yes, the ICAI has raised concerns over some proposed changes, but NFRA assures that decisions are made after detailed consultations with regulatory bodies.
NFRA has adequate powers under the Companies Act to fulfil its mandate and does not require additional regulatory authority, focusing on maintaining balance and efficiency.
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