The Ministry of Corporate Affairs (MCA) has notified that the non-compliance with the National Financial Reporting Authority Rules, 2018 would attract a penalty of not exceeding Rs. 5,000.
A notification issued on Friday amended the existing rules and inserted a clause prescribing a punishment in case of non-compliance with the said rules.
As per the new rule, “Whoever contravenes any of the provisions of these rules, shall be punishable with fine not exceeding five thousand rupees. and where the contravention is a continuing one, with a further fine not exceeding five hundred rupees every day after the first during which the contravention continues.”
NFRA was constituted in the year 2018 to oversee the quality of service of the professionals (such as auditors, CFOs, etc., and suggest measures required for improvement in the quality of service; Perform such other functions related to the above.
The NFRA Rules mandates that every auditor shall file a return with the Authority on or before the prescribed due dtae every year in such form as may be specified by the Central Government. The authority shall receive recommendations from the ICAI on proposals for new accounting standards or auditing standards or for amendments to existing accounting standards or auditing standards.
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