Saturday, March 12, 2016

Listed companies to disclose audit qualifications impact separately- SEBI SAYS

Listed companies to disclose audit qualifications impact separately- SEBI SAYS  

To ensure information is disseminated to investors on time, Sebi will revise the disclosure requirements for companies with respect to impact of "qualifications" made by auditors in their reports. 

The Sebi board, which 
met here today, approved the changes that would further streamline the whole process and also ensure the impact of audit qualifications is disseminated to investors without any delay. 

Now, listed entities will be required to disclose the cumulative impact of all the audit qualifications on relevant financial items in a separate form called 'Statement on Impact of Audit Qualifications' instead of the present form. 

Such disclosures will have to be made in a tabular form along with annual audited financial 
results filed in terms of listing regulations. 

"The new mechanism would be applicable from the financial year ended March 2016 as well as for the earlier cases," Sebi said in a release after the board meet. 

In case there are no audit qualifications, companies will not have to file a particular form as required now. 

"The management shall have the right to give its views on the audit qualification in the new form... The existing requirement of adjustment in the books of accounts of the subsequent year shall not be necessary," Sebi said. 

Already, the regulator has a mechanism to review the audit qualifications in the audit report. The same was incorporated in the Sebi (Listing and Other Disclosure Requirements) Regulations, 2015.

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