N F R A
NFRA Rules 2018 Notified : Requirements for Companies and Auditor
The MCA vide its notification dated 13 November 2018 has notified the National Financial Reporting Authority Rules (NFRA) 2018.
It covers:
· Classes of companies and bodies corporate governed by authority
· Function and duties of the authority
· Annual return to be filed by auditor
· Recommending accounting standards and auditing standards
· Monitoring and enforcing compliance with accounting standards and auditing standards
· Power to investigate and disciplinary proceedings
· Disciplinary proceeding and manner of enforcement of order passed
· Punishment for non-compliance
The rules will come into force on the date of their publication in the Official Gazette.
Applicability & Key Requirements
Rules 3(1) – following classes of companies will be governed by NFRA Rules: (a) Listed companies; (b) Unlisted companies with paid up capital of INR 500 CR or more / Annual Turnover of INR 1000 CR or more / outstanding loans, debentures and deposit of more than INR 500 Cr or more, as on 31st March of immediate preceding FY (c) Insurance Companies, banking companies, companies with business of generation or supply of electricity, companies governed with special act or companies incorporated in reference with clauses (b) to (f) of Section 1(4) (d) Any reference made by Central Government to NFRA authority (e) Body corporate registered outside India, which is subsidiary or associate company of companies / body corporate registered in India, with income / Networth of subsidiary or associate company is +20% of consolidated income / consolidated Networth
Note: as per Rule 3(2), companies from (a) to (d) are not required to file form NFRA – 1 Rule 3(2) - Following companies to file Form NFRA – 1 (details of auditor) within 30 days from rules being notified: (f) Private companies (g) Unlisted companies which are not covered under Rule 3(1) (h) Any other companies / body corporate which are not governed under NFRA authority and NFRA Rules
Rule 3(3) – Following body corporates to file *Form NFRA – 1 on appointment of auditor within 15 days: (i) Body corporate other than companies as defined under Section 2(20) to intimate appointment of auditor within 15 days in Form NFRA -1 Rule 5 – Annual returns : Auditors referred in Rule 3 to file returns on or before 30th April of every financial year.
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THANKS,
BEST REGARDS,
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CA. HARSHAD VAGHELA (ACA, M.COM)
H J VAGHELA & CO.
CHARTERED ACCOUNTANTS
Mo: +91 81401 86390, +91 97224 14769, +91 81604 24957
@: caharshadvaghela@gmail.com, ca.hjvaghela@gmail.com
Address: SF-206 Maruti Plaza, Above Vijay Sales,
Sardar Chowk Road, Vijay Park BRTS N.H. 8,
Krishna Nagar, Naroda, Ahmedabad, Gujarat-382345
