Faculty:- CMA R GOPAL MFM M.Phil., FCMA Practicing Cost Accountant The Institute of Cost Accountants of India Erode Chapter NFRA RULES 2018 5TH JANUARY 2019----SATURDAY--6.00 p.m to 9.00 p.m. Faculty:- CMA R GOPAL MFM M.Phil., FCMA Practicing Cost Accountant

Chartered Accountants Applicable to Chartered Accountants

Not applicable to CMA & ACS

Companies act 132 Constitution of NFRA

NFRA consists 132 (3) Chairman + 15 members (expertise in accountancy, auditing, finance or law)   Not be associated with any audit firm (including related consultancy firms)

initiated an investigation Sec 132 (4) (a) matters of professional or other misconduct committed by any member or firm of chartered accountants initiated an investigation

Sec 132 (4) (b) (i) discovery and production of books of account and other documents, at such place and at such time as may be specified by the National Financial Reporting Authority; (ii) summoning and enforcing the attendance of persons and examining them on oath; (iii) inspection of any books, registers and other documents of any person referred to in clause (b) at any place; (iv) issuing commissions for examination of witnesses or documents

penalty (I) not less than one lakh rupees, but which may extend to five times of the fees received, in case of individuals; and (II) not less than ten lakh rupees, but which may extend to ten times of the fees received, in case of firms;

debarring the member or the firm six months or for such higher period not exceeding ten years

Need for NFRA banking frauds, the NPA crisis, Tax evasion

Which Companies Will Be Covered By NFRA All Listed Companies/ Listed Body Corporate All Banks/ Insurance/ Electricity Companies Foreign Subsidiary/Associate company  Unlisted Companies which Paid up Capital is Rs. 500 Cr. or More; OR Turnover is Rs. 1000 Cr. or More; OR AGGREGATE of Outstanding Loan, Debentures and Deposit is 500 Cr. or More.

Some Important Points: Every existing body corporate other than a company governed by these rules, shall inform the Authority within thirty days of the commencement of these rules, in Form NFRA-1, the particulars of the auditor as on the date of commencement of these rules.  

Additional points Once a Company falls under the above limits under NFRA, will be covered by NFRA for 3 More years EVEN IF LIMITS ARE REDUCED/ LISTED STATUS CHANGES LATER ON.   Every Body Corporate other then Company as defined u/s 2(20) formed in India and governed under this rule shall, within fifteen days of appointment of an auditor under sub-section (1) of section 139, inform the Authority in Form NFRA-1, the particulars of the auditor appointed by such body corporate.

Filing Of Annual Return By Auditor Every auditor referred above shall file a return with the Authority on or before 30th April every year in such form as may be specified by the Central Government

Definitions accounting standards, auditing standards auditor full-time member part-time member

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