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20-06-2014

Announcement1

Applicability of Section 143(12) to Financial Years beginning on or after 1st April 2014

The Council of the Institute of Chartered Accountants of India, at its adjourned 333rd meeting held on 18th June 2014, considered the issue of applicability of the provisions of section 143(12) of the Companies Act 2013 to the financial periods beginning on or after 1st April 2014. In other words, whether the statutory auditor would be required to report pursuant to section 143(12) while carrying out audits of financial statements for the interim periods, such as quarterly or half yearly audits.

The Council of the view that such quarterly/ half yearly audits are not carried out pursuant to the requirements of the Companies Act 2013 (rather to meet the specific requirements of the auditee company, for example, to comply with the listing agreement requirements) as the latter only envisages audit of the annual financial statements.

The Council, accordingly, felt that prima facie, as a corollary, section 143(12) would become applicable only for financial year (and not for a period) 2014-2015 and onwards. The Council is, however, in the process of communicating with the Ministry of Corporate Affairs in this regard.






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1 This Announcement has been issued by the President ICAI under the authority of the Council of ICAI.

 

 

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