Sharing his views on the ongoing crackdown on audit firms, Vishesh Chandiok, national managing partner, Grant Thornton India LLP, said that banning a firm will not serve in public interest.
“Banning a firm will only reduce capacity from the market, whether that capacity is for companies who prepare financial statements and want them audited, or capacity for employees, partners... all that will happen by banning a firm is those people will leave and have to find new jobs,” he said in an interview with CNBC-TV18's Shereen Bhan.
The comments come as the government has sought a five-year ban on the auditors of crisis-hit Infrastructure Leasing & Financial Services (IL&FS). The auditors under the cloud are Deloitte and BSR Associates.
Talking further about banning global firms, Chandiok said, “In absolutely exceptional circumstances, I do not see what banning firm achieves. Of course, you have the ability to levy a fine of up to 10 times the audit fee which can be a fairly substantial deterrent if someone is found guilty of doing something.”