The National Financial Reporting Authority recently said that companies will be chosen for audit quality and financial reporting quality review based on the impact the entity has on the economy.
Which of the following functions are performed by the National Financial Reporting Authority (NFRA)?
Audit of all listed companies
Audit of all unlisted companies
Quality audits of private limited companies
Select the correct answer suing the code given below:
Correct Option: A
Statement 2 is incorrect: Unlisted public companies having paid-up capital of not less than rupees five hundred crores or having annual turnover of not less than rupees one thousand crores or having, in aggregate, outstanding loans, debentures and deposits of not less than rupees five hundred crores as on the 31st March of immediately preceding financial year come under NFRA.
Statement 3 is incorrect: Quality Review Board (QRB) performs quality audits for private limited companies.
Write a note on the objectives and significance of the National Financial Reporting Authority. (150 Words)
Introduce by describing National Financial Reporting Authority, its formation under Companies act, 2013
Give a background on the need for NFRA (Eg. Satyam scandal)
Enumerate the objectives of NFRA
Discuss the significance if having an independent regulator to oversee the auditing profession and accounting standards in India