ICAI lashes out at NFRA over TAC report

It’s a fact! The ICAI and the NFRA, two audit regulators, have drawn their daggers in public, with the CA Institute rejecting the Technical Advisory Committee (TAC) report of March 2021 altogether.

When it comes to the recently released NFRA consultation paper, the CA Institute and the National Financial Reporting Authority (NFRA), the new audit regulator for listed and large firms, are at odds.

CA Institute writes to the Ministry of Corporate Affairs, expressing concern over the excess of the NFRA consultation paper.

It may be remembered that this report — the first TAC, with recommendations on Increasing Stakeholder Engagement — served as the foundation for the National Financial Reporting Authority (NFRA) issuing a consultation paper on this topic in June.

The Institute of Chartered Accountants of India (ICAI) has expressed major concerns to the government about the findings of the NFRA’s Technical Advisory Committee (TAC fundamental)’s viability.

The ICAI President, Jambusaria, stated that the consultation paper was released without consulting the ICAI on the audit subjects’ factual accuracy. He noted that the TAC report contains charges against all stockholders, including auditors, preparers, management, regulators, and the government.

CA Institute President Nihar N Jambusariya voiced great worry over the TAC report’s “one-sided surrealism” in a tersely worded letter delivered along with roughly 120 pages of detailed comments on the NFRA consultation paper.

“ICAI has reviewed the NFRA consultation paper and has reservations about the remarks expressed in the Consultation Paper as well as the TAC report. In our letter to the Ministry of Corporate Affairs, we expressed our significant reservations,” Jambusaria stated.

In many cases, Jambusariya added, the paper’s erroneous circular argument parallels, references, and hence inferences were far from reality.

He said the TAC report issued without consulting the NFRA Board members and the ICAI will have a negative impact on the overall image of the nation.

The ICAI desired the TAC file scrapped, announcing it become primarily based totally at the perspectives of a miniscule set of stakeholders who spoke back to a questionnaire. The file needs to be redrafted primarily based totally at the perspectives of a massive pattern set of stakeholders, the ICAI said.

Otherwise, “It will have an effect on the funding possibilities withinside the country, India’s score and additionally perception of the arena approximately ease of doing commercial enterprise in India” Jambusaria said.

“…the goal of each the NFRA and the ICAI is to work for common public exact and now not as competing entities, still it’s been seen that a alternatively non-collaborative method is being followed by way of NFRA and the way in which the TAC document and the session paper is worded, in which NFRA has also given its preliminary view within the stated record, plainly NFRA feels that for so many years there was no regulator for accounting and auditing profession,” the ICAI President’s July 9 letter to NFRA stated.

“however, we would like to clarify that ICAI was set up below an Act of Parliament way lower back in 1949 and as according to the Chartered Accountants Act 1949 —“it is an Act to make provision for law of the career of Chartered Accountants” Jambusaria said.

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