Against the SEBI’s move to regulate the Chartered Accountants, the Institute of chartered Accountants of India ( ICAI ) has said that the Chartered accountants cannot be included as fiduciaries and the same is beyond the powers of SEBI and is inconsistent with the Apex Ruling in North Carolina (of USA).
The ICAI has submitted a bunch of suggestions to the proposed SEBI (Fiduciaries in the Securities Market) (Amendment) Regulations, which was released a few week ago for public comments.
The SEBI’s proposal was to stringent the rules for auditors and Valuers hired by listed companies for auditing financial results as the Auditing lapses have allegedly caused several frauds to go unnoticed for years and there is no direct control by SEBI on the auditing firms.
ICAI Chief CA Naveen ND Gupta, while addressing the members last day said that “SEBI had issued a consultative paper on the proposed SEBI (Fiduciaries in the Securities Market) (Amendment) Regulations seeking public comments, wherein Chartered Accountants have been included in the definition of fiduciaries along with other professionals. In this regard, ICAI has submitted its suggestions and stated that the proposed Consultative Paper issued by SEBI goes beyond the powers of SEBI and there is no specific statutory provision under the SEBI Act conferring powers on SEBI to take action against auditors of listed companies. It has also been highlighted that the apex court of North Carolina (of USA) has decided that auditors/ accountants are not part of fiduciaries. Therefore, the Consultative Paper should not include the Chartered Accountants as fiduciaries.
