Quick Summary
The National Financial Reporting Authority (NFRA) has issued revised Standards on Auditing (SA 600) for public consultation, aiming to strengthen group audits in response to deficiencies highlighted in several corporate fraud cases. The revised standard targets Public Interest Entities (PIEs) under
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FAQ :
The revised SA 600 aims to strengthen group audits, particularly for Public Interest Entities, by increasing the accountability of group auditors for the work performed by component auditors.
The revised standard targets Public Interest Entities (PIEs) under Rule 3 of the NFRA Rules 2018, excluding Public Sector Enterprises, Banks, Insurance Entities, and their branches.
The revision was prompted by deficiencies noted in several high-profile corporate fraud cases, such as Coffee Day Global and Reliance Capital, where audit failures by both principal and component auditors were evident.
The group auditor will be held accountable for the audit work performed by the component auditors who audit subsidiaries or associates.
Yes, the revised SA 600 is currently open for public consultation, allowing stakeholders to provide their feedback.
The Institute of Chartered Accountants of India (ICAI) has expressed concerns that the revision might undermine reliance on a Chartered Accountant's findings, potentially devaluing the profession.
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