SEBI Chairperson pitches for Technology driven third-party validation to evade Fraud

Chairperson of Security and Exchange Board, Ms Madhabi Puri Buch today pitched for technology driven third-party validation in order to evade fraud. She was addressing auditors are the closing ceremony of Audit Week Celebrations by Indian Audit and Accounts Department in Mumbai. This year several events were organized to mark the second Audit Diwas by Indian Audit and Accounts Department offices across the country.

Pitching strongly for third-party validation in the processing of auditing, the SEBI Chairperson said that the only way to ensure a true and fair picture of everything we present, is through third party validation. “SEBI’s thrust on third party validation is driven by the commitment to ensure true and fair picture of whatever is presented in the markets”.

The SEBI Chairperson further said that there are more 20 websites in the country which auditors can use to validate the claim of the auditee. “While technology is being used as a tool by fraudsters, we can use the same technology to evade fraud. Auditors can use tools like GSTN portal, bank websites etc. for doing a third-party validation.”  

Speaking further on ‘Role of transparency and accountability in governance’, the SEBI chairperson said that if there is transparency in the market, then market forces themselves act in an efficient way and ensure there is no wrong-doing in the market. “As a regulator, SEBI is responsible for a true and fair picture of an entire market, this is why we insist on transparency. The foundation of an efficient market is that there is no information dissymmetry.”

Appreciating the work of auditors, the SEBI Chairperson said “As a business leader or as a leader of an institution, our accountability is to ensure that there are no errors of omission and no errors of commission”. She added that auditors help us in achieving the same and ensure our peace of mind.

Exhorting the auditors participating the function, the SEBI Chairperson said that she considered auditors as free consultants. “In any disclosure document, one has to check factors like errors, omission, distortion of the context, denial, minimizing, exaggeration, fabrication.”

Talking about Governance, the SEBI chairperson said conscience is the guiding principle. “Ask yourself whether I will be able to defend this when this is published in newspapers the next day.”

Sharing the details of the event, Director General of Indian Audit and Accounts Department, Shri Gulzari Lal said “In our effort to expand our reach to the youth of this country, we organized a National Online Essay Writing Competition for university students. The bi-lingual competition in Hindi and English elicited encouraging responses. More than a thousand entries have been received from students pursuing their studies in premier institutes and universities. The theme of this year’s essay focused on the CAG’s role in 2047, the year India completes 100 years of independence, and what it can do to address global challenges like climate change”.

Audit Diwas commemorates the day the first auditor general took charge of this office in 1860.

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