Auditors may have to compulsorily get registered with National Financial Reporting Authority, said Dinesh Kanabar, CEO, Dhruva Advisors LLP, after government fast-tracked the creation of NFRA.
The creation of NFRA was first mooted in the Companies Act 2013. The NFRA will have the powers to investigate suo moto, and even penalise any member or firm of chartered accountants.
Speaking to CNBC-TV18, Kanabar said government has identified that Institute of Chartered Accountants of India (ICAI) is not sufficient and needs to be an external regulation like Public Company Accounting Oversight Board (PCAOB) in USA.
According to Kanabar, NFRA would have the power to review financial statement of companies, can seek explanations and probe irregularities with respect to accounting and auditing issues.