Fraud reporting norms by auditors may be diluted

The Centre is likely to dilute fraud reporting norms by auditors as The Institute of Chartered Accountants of India (ICAI) has told the government that it is not possible to report on all frauds.

Confirming the development, ICAI President K Raghu said, “Under the current guidelines, all frauds should be reported by the auditors. However, we have told the government that only material fraud, depending on the size of the company, should be reported.” The government has considered all our views in this regard and so fraud reporting norms are likely to be diluted, Raghu added.

Raghu said that the body is all geared up to implement the International Financial Reporting Standards (IFRS).

“IFRS will be adopted on a voluntary basis from 2015-16 and made mandatory from 2016-17. We are already completely ready with the new systems required for the implementation,” Raghu said.

ICAI has also met RBI and Finance Ministry officials 2-3 months ago to consider changes in bank audit regulations. “Bank branches which have advances of over Rs 20 crore are only subject to audit currently, We have told the Finance Ministry and RBI officials to consider audit for each and every branch, irrespective of their advances,” Raghu said.