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Chartered accountants’ body clashes with govt authority over proposed audit reforms | Mint

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The Institute of Chartered Accountants of India (ICAI) has called for a pause in the public consultation on reforming India's auditing standards. The ICAI believes that a contentious clause in the accounting standards has stood the test of time but acknowledges the need to strengthen the standards. The clause in question allows a parent company's auditor to rely on the work of a subsidiary's auditor without being held responsible for it. The National Financial Reporting Authority (NFRA) wants to fill this loophole, proposing that lead auditors of business groups be ultimately responsible for their consolidated financial statements. The ICAI has objected to NFRA's proposed changes, stating that it is not desirable for the auditor of a parent company to control the decisions of equally qualified subsidiaries' auditors.