NFRA Highlights Audit Firms' Weakness, Areas Requiring Improvement

2025-03-29 02:32:12

(MENAFN- Live Mint) The audit watchdog National Financial Reporting Authority (NFRA) has highlighted specific aspects of practice that auditors SRBC & Co. LLP, Walker Chandiok & Co. LLP and Deloitte Haskins and Sells LLP need to improve in a series of reports prepared after visiting the firms and inspecting specific audits conducted by them.

NFRA's inspection reports are not disciplinary in nature but offer audit firms an opportunity to improve their systems and procedures.

NFRA said in a report released on Friday that Walker Chandiok & Co., which the regulator previously reported as part of Grant Thornton International Ltd, needs to comply with auditor independence requirements specified in Section 144 of the Companies Act.

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The watchdog said that Walker Chandiok & Co., in its communication to NFRA, however, has maintained that it is not a member of the GTIL network. The audit firm has not remediated the issue related to the auditor's independence and audit documentation noted in the previous inspection report, NFRA alleged.

In response to a query from Mint, a spokesperson for Walker Chandiok & Co. said that the firm is committed to upholding the highest financial reporting standards.

Accountability and integrity

“We believe in accountability and integrity towards our stakeholders and are committed to enhancing audit quality to protect public interest and continue to discharge our professional responsibilities in the nation's economic growth and development,” the spokesperson said.

The spokesperson said the current inspection focused primarily on remediating observations in the 2022 inspection report, which was issued in December 2023, but it also covered audits for engagements conducted prior to the issuance of the report.

“We have consistently upheld the highest standards of audit quality and demonstrated our commitment to auditor independence by being the first to impose a self-regulated embargo on providing permissible non-attest services to listed audit clients, including their holding and subsidiary companies in July 2019,” the spokesperson said.

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