NFRA has appealed to the Supreme Court against the Delhi High Court’s decision quashing show-cause notices to major audit firms for procedural lapses in disciplinary actions, impacting ongoing proceedings.
The Supreme Court upheld NFRA’s authority to probe financial auditor misconduct retrospectively, dismissing an appeal against NCLAT ruling. This affirms NFRA’s jurisdiction and regulatory oversight, impacting financial auditing in India. Legal experts’ opinions vary, highlighting the need for clarity in regulatory enforcement. NFRA imposed penalties on CAs, emphasizing compliance with auditing standards. The NCLAT ruling asserts NFRA’s retrospective jurisdiction and supremacy in auditing standards. The Supreme Court’s dismissal reinforces this decision.
New Delhi: Recently, The Supreme Court upheld the National Company Law Appellate Tribunal’s order on disciplinary action against auditors, strengthening the National Financial Reporting Authority’s (NFRA) authority. The case involved a penalty and practice bar against an auditor due to lapses in DHFL’s audit. This decision sets a precedent for NFRA’s disciplinary measures in similar cases.
