sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing | GST - Goods and Services Tax
Latest Expert Exchange
« News Headlines »
 Here’s all you need to know New Income Tax return for salaried class available on IT portal
 What to do if you missed the (second) tax deadline
 Income-tax (5th Amendment) Rules, 2018 - Notification under section 9A (3) of the Income-tax Act, 1961 in respect of Fund Manager Regime
 Income Tax department warns salaried class again filing wrong ITRs
 ITR-1 form for AY 18-19 now available for e-filing
 New Income Tax Return Form for Salaried Class available in Portal
 Income Tax Return: ITR-1 ready for e-filing, says I-T department
 6 Tax changes you need to keep in mind while filing ITR for FY17-18 Income Tax Return efiling
 Income-tax (5th Amendment) Rules, 2018
 Last-minute tax tips for late filers
 What demonetisation did to tax collections

Audit worries for EU-listed Indian cos
April, 07th 2008

Nearly 200 Indian firms listed on European bourses may be forced to either re-audit their financial statements by European auditors or face regulatory action including delisting. The audit firms which sign the financial statements of most of these companies do not adhere to several requirements for statutory auditors that EU wants member-states to implement from June 2008.

The new guidelines under EUs eighth directive propose to make auditors disclose more and get them monitored by an independent oversight body. The rationale for the new norms is that European investors rely on the judgement and views of these auditors for making investment decisions.

Therefore, Indian companies listed on EU bourses may have to either get their securities delisted or get their balance sheets re-audited by audit firms there. This, accounting experts believe, will drive up their costs manifold.

It remains to be seen how EU deals with non-compliance and whether it provides a grace period for non-EU companies to comply with the norms.

About 80 Indian audit firms lead the pack of non-EU firms auditing the books of non-EU companies listed in Europe, followed by about 46 American firms auditing US companies listed on EU bourses, experts told ET, quoting an EU survey early last year.

While the new rule means additional work, higher cost of compliance and the worst possibility of delisting for Indian companies raising funds from there, for the audit firms located in India and signing their books, it means a potential loss of business.

The statutory auditor scrutinises various entries in the financial statements and expresses satisfaction or dissent in his report. The EU wants these auditors to disclose their total earnings from audit and non-audit services as well as the amount the firm pays its partners. The independence of audit could be compromised if the auditor also gives advisory or non-audit services.

As per the new norms, the statutory auditor should be compulsorily monitored by independent oversight boards which have a majority of non-practising chartered accountants (CAs). Sources in audit firms pointed out that the professional regulator in India, the Institute of Chartered Accountants of India (ICAI) includes mainly practising CAs and may not fit into EUs definition of independent professional oversight body.

Countries like India have a great stake in how the eighth directive is interpreted by various EU nations. Particularly, we have to closely watch whether EU considers our oversight system adequately independent since it is not manned predominantly by non-practitioners as required.

At stake is the ability for Indian auditors to continue to serve clients listed on EU, said Ernst & Young India director Rahul Roy. However, ICAI is confident it can tackle the situation. President Ved Jain said We have a quality review board comprising six government nominees and five ICAI nominees. I am sure they will be able to handle this issue.

Home | About Us | Terms and Conditions | Contact Us
Copyright 2018 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Web Application Development Web based Software Solution Web Application Deployment Web Application Solutions Web Application Software Development Web Application Deployment Web Application Programming Web Application Design and Development

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions