Friday, 02 December 2022 05:42 AM IST

NFRA debars chartered accountant for lapses in the audit of Vikas WSP

National Financial Reporting Authority (NFRA) on Monday debarred a chartered accountant, Som Prakash Aggarwal for lapses in the audit of Vikas WSP, a listed company that manufactures and exports guar gum powder.


The independent regulator overseeing auditing and accounting professions has also imposed a monetary fine of Rs 3 lakh on the chartered accountant (CA). The development comes after NFRA received information from market regulator Securities and Exchange Board of India (Sebi) regarding potential lapses in the audit work of Som Prakash Aggarwal for 2019-20.


In its investigations, NFRA found that the CA failed to report non-recognition of interest costs pertaining to borrowings of the company classified as non-performing assets by banks. This was important since interest cost constituted 88% of profit before tax reported by Vikas WSP.


The NFRA order also said the CA failed to consider crucial provisions of Indian accounting standards while conducting statutory audit.


"CA Som Prakash Aggarwal failed to conduct the audit in accordance with the SAs (standards of auditing) and applicable regulations," the NFRA order said. He also failed "to report the material misstatements and non-compliances made by the company in the financial statements", it said. Source- Clickhere