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Accounting & Audit Audit & Acc - Misc.

  • Auditors come under lens amid crackdown on shell companies
    Sep 14, 2017
    A multi-agency clampdown has begun on shell companies to tackle the black money menace wherein the role of auditors has come under the scanner for alleged connivance in facilitating illegal transactions.The auditors' role is also being looked into for not raising the red flag as several cases have come to the fore, including at listed companies, for alleged mismatch in financial statements, sharp erosion in net worth, siphoning off funds to group and promoter entities, sources said.Stepping up the vigil, the corporate affairs ministry as well as Sebi and other regulatory authorities are keeping a close tab on activities carried out by shell companies.
  • Reserve Bank extends 'rest' period for auditors to 6 years
    Jul 28, 2017
    The Reserve Bank of India (RBI) on Thursday criticised private and foreign banks for appointing the same set of auditors alternatively after mandatory rest of two years, as such practice establishes a “comfortable relationship that may lead to compromise in strict adherence to audit principles.”As per the extant rules, a statutory auditor has to be appointed for a period of four years and then there should be a rest of two years. Now the central bank extended the rest period to at least six years.According to RBI, in some cases in private and foreign banks, the same audit firm was reappointed after a gap of two years’ rest.
  • Government draws up checklists for GST audits
    Jul 21, 2017
    The Centre has created a detailed road map for goods and services tax (GST) audits barely 20 days after the levy’s rollout, listing risks, target industries and even potential auditees for officials examining corporate India’s transition to the new regime.In the past week, the government has reached out to tax commissioners on the audit process, highlighting the risk areas. Beginning next week, therefore, officials could visit companies to assess whether the transition from the multiple to the single producer levy from July 1 stuck to the rule book.
  • Auditors' report to I-T should have property dealing details
    Jul 06, 2017
    Auditors will now have to disclose details of transactions exceeding Rs 20,000 in connection with immovable property in reports which they file with the I-T authorities on behalf of their clients. Under the Income Tax Act, professionals earning gross receipts of more than Rs 50 lakh and companies with a turnover of over Rs one crore are required to get their accounts audited. The turnover limit for companies has been increased to Rs two crore from Assessment year 2018-19.
  • Auditors' to disclose property related transactions above Rs 20,000 to I-T
    Jul 06, 2017
    Auditors will now have to disclose details of transactions exceeding Rs 20,000 in connection with immovable property in reports, which they file with the Income Tax (I-T) authorities on behalf of their clients.Under the Income Tax Act, professionals earning gross receipts of more than Rs 50 lakh and companies with a turnover of Rs one crore and above are required to get their accounts audited. The turnover limit for companies has been increased to Rs two crore from Assessment year 2018-19.
  • Govt examining report on shifting of financial year: Jaitley
    Apr 08, 2017
    Finance Minister Arun Jaitley said that the government was examining the report of a committee that had recommended a change in the financial year starting April 1. The Minister was responding to a question by Abhisehk Singh (BJP) in Lok Sabha.He said that disclosing the recommendations as well as the government’s view at this stage would amount to “pre-judging the issue.”The committee is learnt to have recommended advancing the financial year and equating it with the calendar year from January 1.Responding to supplementaries, he said since the move had various implications for the Centre, the States and various local bodies, wider consultation was necessary.Raising the issue of SBI imposing service charges on its customers during Zero Hour, CPI(M) member A Sampath, urged the Finance Minister to ensure that rural account holders, in particular, are not burdened.‘Cut SBI charges’“Now that SBI has become a big bank after merger with five subsidiaries, service charges should be reduced,” he said, adding that SBI was not only mandating minimum balance for all users, including rural ones, but was even charging ?15 for sending SMSes.
  • Rotation of auditors and its side effects
    Oct 10, 2016
    The Companies Act, 2013, has introduced important audit reforms. One of the important reforms is rotation of the auditor. All listed companies; unlisted public limited companies having paid-up share capital of Rs 10 crore or more; all private limited companies having paid-up share capital of Rs 20 crore or more, and all companies having public borrowings from financial institutions, banks or public deposit of Rs 50 crore or more are required to rotate their auditor.
  • CAG may audit IDS, not individual declarations
    Oct 03, 2016
    The Comptroller and Auditor General of India (CAG) may audit the just ended black money disclosure scheme for the process followed and how well it performed, but will not get into the disclosures made. As much as Rs 65,250 crore of undeclared assets were declared through 64,275 declarations through the one-time four-month compliance window provided under the Income Disclosure Scheme (IDS) that ended on September 30.
  • Ernst and Young, KPMG and Deloitte scaling up teams on forensic talent
    Sep 30, 2016
    The Big Four audit and accounting firms are aggressively hiring forensic talent to cope with demand generated by companies looking to tackle an increasingly complex regulatory and business environment, as well as current and emerging threats. Ernst and Young, KPMG, PricewaterhouseCoopers and Deloitte are looking to scale up their teams by up to 25% as they broaden forensic data analytics capabilities beyond traditional antifraud and compliance functions into areas such as legal, information governance and cybersecurity.
  • Only 18% of India Inc ready for auditor rotation, says survey
    Jul 20, 2016
    Only 18 per cent of Indian firms are ready for auditor rotation — made compulsory under the Companies Act, 2013 — said a recent survey conducted by Grant Thornton India in association with Prime Database.According to Section 139 of the new Companies Act, every Indian company having a paid-up capital of Rs 20 crore or more that has kept the same audit firm for more than 10 years would need to change the auditor by the end of 2016-17.
  • Audit giants see dominance waning
    Jun 27, 2016
    India’s audit landscape is undergoing a quiet change as the new rules for time-based rotation of auditors gather pace. Early audit changes this year indicate the larger entities, such as Deloitte’s network, could face some pressure on their dominance. And, those lower down the order could gain ground. Leading firms are looking at increasing the focus on quality and are exploring new opportunities, such as private equity-backed ones in the unlisted space.
  • Auditing reforms: PAC wants NGOs, PPPs to come under its purview
    May 02, 2016
    Powers to audit NGOs, summon ministers and former secretaries and a monitoring mechanism for following up the effective implementation of the recommendations are some of the proposals of the Public Accounts Committee (PAC) on the auditing reforms.“PACs felt the CAG mandate extends to conduct of audit of NGOs, any enterprise or programme where government funding is involved, including in government operated agencies such as District Rural Development Agencies (DRDAs) and Public Private Partnership projects,” the report said.Apart from the suggestion that the PAC proceedings should be open to media except in sensitive cases, the report demands that the PAC could consider collection of information through social audit agencies, NGOs, public and a website dedicated to PAC.
  • BSE asks brokers to submit internal audit report by June 30
    Apr 23, 2016
    The Bombay Stock Exchange has directed brokers to submit internal audit report for the half year ended March 31, 2016, by June 30 in electronic form.Non-submission of the report within the cut-off period will attract penalty. All brokers and clearing members are required to carry out complete internal audit on a half-yearly basis by independent chartered accountants or company secretaries who do not have any conflict of interest.
  • RBI directs concurrent auditors to submit reports directly to banks
    Sep 25, 2015
    The Reserve Bank of India has asked concurrent auditors of commercial banks to do to submit their review of non-performing loans directly to the banks and discontinue the practice of submitting it to the statutory auditors who conduct quarterly and half yearly review of bank accounts. Concurrent audit means doing the examination of the financial transactions at the time of happening or parallel with the transaction. Concurrent audit system is regarded as part of a bank's early warning
  • Investment banks order forensic audit of promoters, key management staff
    Apr 22, 2015
    Recently, an investment bank based abroad got in touch with the city-based head of a forensic audit firm. The bank wanted to run a background check on some Indian promoters looking to raise capital abroad. As the offer was underwritten, the bankers wanted to ensure everything about the company and its promoters was above board.Instances of investment bankers seeking reputational and forensic due diligence on promoters are many. In fact, it is part of a global trend that is now catching on in India, too, experts say. Practitioners include Kroll Advisory, KPMG, EY and PWC. “Investment bankers are using various means to get comfortable on capital raises, etc…I am seeing the first signs of some specific procedures in the nature of forensic checks being requested as part of the diligence process,” says Sandeep Dhupia, head, forensic services, KPMG in India.
  • Rise in business forces audit firms to hire fresh commerce graduates
    Feb 27, 2015
    Audit firms are turning to commerce graduates as they anticipate a demand of about 16,000 at the starting level in the next three years amid an expected pickup in business due to the rotation of auditors mandated by the Companies Act and the restriction on the number of chartered accountants that can be hired by a firm. According to the new Companies Act, all companies will have to rotate auditors every 10 years, starting from April 2017.
  • MNC audit exemption for past transactions only with inflation adjustment
    Aug 23, 2014
    Audit exemption allowed by the taxman for MNCs subject to their declaring transaction prices above specified thresholds would be available for past transactions only with inflation adjustments.Under the advance pricing agreement (APA), a facility built into the income tax law to avoid litigation to the extent possible, an MNC can get audit exemption either by a mutual agreement with the taxman on the arm's length price of cross-border transactions or the profit margins they need to declare in India regarding such transactions.
  • ICAI bats for Indian Accounting Standards from April 2016
    Mar 25, 2014
    In order to help India become an International Financial Reporting Standards (IFRS)-converged country, as part of its G-20 commitments, Institute of Chartered Accountants of India (ICAI) has finalised the road map for the implementation of Indian Accounting Standards (Ind AS) starting April 1, 2016. A proposal to this effect has been sent to the ministry of corporate affairs for its consideration, ICAI officials said. As per the roadmap, the consolidated financial statements of listed companies and unlisted companies, having net worth in excess of R500 crore, will be prepared as per Ind AS from the accounting year beginning on or after April 1, 2016 with previous year comparatives in Ind AS for the year 2015-16, the ICAI said.
  • India to adopt global financial standards from April 2015
    Feb 24, 2014
    The corporate affairs ministry is likely to notify within a month all sections and rules of the new Companies Act and start immediately thereafter the process of converging Indian accounting standards with the International Financial Reporting Standards (IFRS), which have to be implemented from April 2015 for companies with a net worth of more than Rs 1,000 crore.
  • Bigger audit firms record faster growth
    Feb 21, 2014
    When it comes to audit firms, the size does matter. These large firms, though fewer in number, cornered the lion’s share of audit fee. The growth in fee earned by these firms is also higher, according to a report. The report, by Prime Academy, an institution that coaches students writing the Chartered Accountancy examination, was based on a sample size of 3,002 listed companies and 1,423 auditors. The 107 large audit firms constituted just 8 per cent of the sample, but secured 32 per of the audits. Their share of the audit fee was 70 per cent of the total audit fee pie. The fee for each audit increased from Rs. 27.5 lakh in 2005 to Rs. 46.61 lakh in 2013, at an average growth rate of 6.6 per cent.
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