Latest News | NFRA Fines, Bars CA for 5 Years from Undertaking Audit Work

New Delhi, Sep 19 (PTI) The National Financial Reporting Authority (NFRA) on Monday imposed a fine on a chartered accountant and barred him for five years from undertaking audit work for various lapses in a case.

The lapses pertain to the performance of Chartered Accountant (CA) Rajiv Bengali of Subramaniam Bengali & Associates as an statutory auditor of Trilogic Digital Media Ltd (TDML), a BSE-listed entity, for the financial year 2016-17.

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He has been debarred for "five years from being appointed as statutory auditor and internal auditor or from undertaking any audit in respect of financial statements or internal audit of the functions and activities of any company or body corporate", an NFRA order stated.

Apart from the ban, NFRA imposed a fine of Rs 5 lakh on Bengali, the order said.

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The CA has been charged with professional misconduct of failure to disclose material facts known to him but not disclosed in a financial statement.

Bengali was also negligent in evaluating the appropriateness of the management's assumption of 'Going Concern' despite existence of adverse indicators like revenue from operations decreased from Rs 51 crore to Rs 17.06 crore, TDML incurred loss of Rs 54.37 crore resulting in erosion of net worth from Rs 58.89 crore to Rs 4.52 crore and reduction in Inventory from Rs 12.71 crore to Nil etc, it added.

It also charged Bengali for failure to exercise due diligence or was grossly negligent in the conduct of his professional duties among others. "The CA in this case was required to ensure compliance with standards of auditing to achieve the necessary audit quality and lend credibility to financial statements to facilitate its users. However, the authority found there were substantial deficiencies in audit and abdication of responsibility on part of Bengali which established his professional misconduct.

"Despite being a qualified professional, Bengali has not adhered to the standards of accounting and has thus not discharged the duty cast upon him," the order said.

TDML is in the business of media and content syndication and listed on BSE.

NFRA is an independent regulator for the auditing profession under the Ministry of Corporate Affairs.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)