Market regulator Sebi wants to appoint auditors to carry out forensic audits of financial statements of listed companies as part of the efforts to combat fraud. In recent months, Sebi has commissioned forensic audits of certain companies.
The Securities and Exchange Board of India (Sebi), according to a public notice, has invited applications from eligible CA (Chartered Accountant) firms “for empanelment to carry out assignments related to forensic audits of financial statements of listed companies ”.
The applicant should have had experience of undertaking at least 15 forensic audits in past three years and at least three such audits should have been undertaken upon assignment by the regulatory body or government agency or public sector enterprise.
In addition, total revenue of the firm from forensic audit assignments in the last three financial years must be at least Rs 1 crore. Interested entities can send their applicants to Sebi within 21 days, as per the notice issued on May 21.
In October 2020, Sebi asked listed companies to make disclosures about initiation of forensic audit to stock exchanges as part of an effort to address the gaps in availability of information.
Under the framework, listed entities need to make disclosures about the fact of initiation of forensic audit along with the name of the entity initiating such audit and reasons for the same, if available, to the stock exchanges.
Further, the companies are required to disclose about final forensic audit report, other than for forensic audit initiated by regulatory or enforcement agencies, along with comments of the management, if any.