CA Bill passed in Rajya Sabha: Autonomy of audit bodies will not be diluted, says Nirmala Sitharaman

The Chartered Accountants, the Cost and Works Accountants and the Company Secretaries (Amendment) Bill, 2022, which was passed by the Rajya Sabha on Tuesday, will not dilute the autonomy of the audit and accountancy bodies, Finance Minister Nirmala Sitharaman said Tuesday, stressing that it will strengthen corporate governance.

The Bill, which amends the Chartered Accountants Act, 1949, the Cost and Works Accountants Act, 1959, and the Company Secretaries Act, 1980, provides for the setting up of a coordination committee headed by the Secretary of the Ministry of Corporate Affairs. It has sparked a debate in and outside the Parliament.

Sitharaman said while a coordination committee already exists, as pointed out by certain Opposition MPs, “it has not even taken off”. “The proposed amendments are very much in line with the core principles which have been given by the independent audit regulators…” she said.

Sitharaman, who also holds the corporate affairs portfolio, said questions have been raised over transparency in auditing ever since the Satyam and the ILFS scandals broke. “We have repeatedly been questioned about the number of failings of the CAs.

“If the corporate governance structure has really got to be robust to meet with the global investment expectations about our standards of audit, our standards of investment policy, about how auditing certificates are being given, we need to have greater robustness and also a level of accountability brought in,” she added.

Among Opposition MPs who questioned the clause on the coordination committee was Akali leader Naresh Gujral, who said the committee’s chairperson should be someone who is proficient with the subject and has domain knowledge.

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