Directions issued by Committee of experts on regulating Audit firms and the Networks as per its report submitted in pursuance of directions of the Supreme Court
(i) The Union of India may constitute a three member Committee of experts to look into the question whether and to what extent the statutory framework to enforce the letter and spirit of Sections 25 and 29 of the CA Act and the statutory Code of Conduct for the CAs requires revisit so as to appropriately discipline and regulate MAFs. The Committee may also consider the need for an appropriate legislation on the pattern of Sarbanes Oxley Act, 2002 and Dodd Frank Wall Street Reform and Consumer Protection Act, 2010 in US or any other appropriate mechanism for oversight of profession of the auditors. Question whether on account of conflict of interest of auditors with consultants, the auditors’ profession may need an exclusive oversight body may be examined. The Committee may examine the Study Group and the Expert Group Reports referred to above, apart from any other material. It may also consider steps for effective enforcement of the provisions of the FDI policy and the FEMA Regulations referred to above It may identify the remedial measures which may then be considered by appropriate authorities. The Committee may call for suggestions from all concerned. Such Committee may be constituted within two months. Report of the Committee may be submitted within three months thereafter. The UOI may take further action after due consideration of such report.
(ii) The ED may complete the pending investigation within three months;
(iii) ICAI may further examine all the related issues at appropriate level as far as possible within three months and take such further steps as may be considered necessary.
The Committee of Experts has submitted its report on Regulating audit firms and the Networks to the Government of India through the Secretary, Ministry of Corporate Affairs. The Committee was constituted on April 20, 2018 pursuant to the directions of the Hon’ble Supreme Court in the matter of S. Sukumar versus The Secretary, Institute of Chartered Accountants of India. The Committee consisted of Shri Anurag Agarwal, Joint Secretary, Ministry of Corporate Affairs, Shri Sudhanshu Pandey, Additional Secretary, Department of Commerce and Shri Ravinder, Joint Secretary, Department of Industrial Policy and Promotion.