IMPLEMENTATION OF NFRA-”A ENCROACHMENT IN INDEPENDENCE OF ICAI”

www.carajput.com; NFRA

www.carajput.com; GST UPDATE

ICAI has formed a special group to interact with the Government on a day-to-day basis for the formation of the National Financial Reporting Authority (NFRA) Rules.

NFRA Vs ICAI:

Was Our ICAI Leadership played a Proactive Role to Save Autonomy of the ICAI?

Ministry of Corporate Affairs has notified relevant sections to give effect to NFRA by way of notification on the 24th of October,2018.

Below are the few points and critical aspects that you need to know about NFRA:

  • Till now ICAI used to make recommendations to the Central Government on the formulation and laying down of accounting and auditing policies and standards but, from now onwards ICAI will act as advisory to NFRA and NFRA will recommend to the Government
  • NFRA has the power to investigate, either suo-motu or on a reference made to it by the Central Government, for such class of bodies corporate or persons, in such manner as may be prescribed into the matters of professional or other misconduct committed by any member or firm of chartered accountants,And no other institute or body shall initiate or continue any proceedings in such matters of misconduct where the National Financial Reporting Authority has initiated an investigation.So, ICAI cannot interfere where NFRA has issued proceedings
  • NFRA have the same powers as are vested in a civil court
  • And the most critical one comes here, PENALTY

Where professional or other misconduct is proved:

  • NFRA may impose one lakh rupees – five times of the fees received, in case of individuals
  • Ten lakh rupees -Ten times of the fees received, in case of firms
  • Debarring the member or the firm from Practice 6 months – 10 years

Disclaimer: The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; before making any decisions do consult your Professional / tax advisor. For misrepresentation or interpretation of act or rules Author does not take any responsibility. Neither the author nor the firm accepts any liability for the loss or damage of any kind arising out of information in this document or for any action taken in reliance there on. carajput.com is committed to helping entrepreneurs and small business owners to start, manage and grow their business with peace of mind. Our goal is to support the entrepreneur on legal and regulatory requirements and to be a partner throughout the entire business life cycle, offering support to the company at every stage to ensure that it is compliant and consistently growing. Hope the information will assist you in your Professional endeavors. For query or help, contact: info@carajput.com or call at 09811322785/4 9555 5555 480)