New Delhi: The National Financial Reporting Authority (NFRA) has constituted an Expert Advisory Committee on Audit Quality, Assurance and Technology to provide expert inputs on issues that have a significant bearing on audit quality.
The committee has been formed under Rules 15 and 16 of the NFRA Rules, 2018, which empower the authority to constitute committees, study groups and task forces for effectively carrying out its functions and promoting awareness of accounting and auditing standards. The announcement was made by the Press Information Bureau on September 4.
Committee Brings Together Experts From Key Stakeholder Groups
The newly constituted panel brings together professionals and representatives from different stakeholder groups associated with financial reporting and auditing.
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According to NFRA, its members include experts representing:
- Audit and accounting professionals
- Chief Financial Officers
- Audit committees
- Independent directors
- Technology
- Regulators
- Industry
NFRA’s published list names nine members, including former SEBI Whole-Time Member Ananth Narayan Gopalakrishnan, iSPIRT Foundation technical architect Amit Jain, Hindalco Industries CFO Bharat Goenka and former RBI Deputy Governor Shyamala Gopinath.
Technology and AI Among Committee’s Focus Areas
The committee’s mandate covers both traditional audit-quality issues and emerging technology-related risks.
Its terms of reference include:
- Consistent implementation of Standards on Auditing and standards relating to quality control and quality management.
- Identifying audit areas, sectors and emerging risks requiring thematic or sectoral attention.
- Examining the governance and practical risks associated with data analytics, automation, artificial intelligence and machine learning in audits.
- Addressing cybersecurity and cloud-related risks affecting audit platforms and audit documentation.
- Examining audit implications arising from technologies such as ERP systems, APIs, system logs, digital-payment systems, blockchain and cloud environments.
- Providing inputs for stakeholder outreach, guidance material, FAQs and staff publications.
Third Advisory Committee Constituted by NFRA
The latest panel is the third such advisory body constituted by NFRA.
The authority had earlier established a Technical Advisory Committee in July 2020, whose term ended in December 2022. In July 2024, NFRA constituted an Advisory Group on Auditor-Audit Committee Resources to provide inputs on resources and outreach involving audit committees and independent directors.
NFRA’s official records list the new Expert Advisory Committee among its advisory groups and committees.
The committee is expected to provide recommendations and expert inputs to NFRA on audit quality, assurance standards, technology-related risks and stakeholder engagement within its mandate.
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