Important Update for Auditors: File NFRA-2 Form within the Next 4 Days, Know Complete Filing Details

Who all should file NFRA 2 Form

The auditors who are auditing following companies has to file the form:

1. All listed companies- whether listed in India or abroad.
2. Large unlisted public companies with either Paid-up capital ≥ ₹500 crore, or Turnover ≥ ₹1,000 crore, or Loans, debentures, and deposits ≥ ₹500 crore (as on 31 March of the preceding year).
3. Specified regulated sectors including insurance companies, banking companies, electricity generation/supply companies, companies governed by special Acts, and statutory bodies under Section 1(4)(b)-(f) of the Companies Act.
4. Companies or bodies corporate, referred by the Central Government to NFRA in public interest.
5. Foreign subsidiaries or associates of Indian companies falling under clauses (a)-(d), where the foreign entity’s income or net worth exceeds 20% of the consolidated income or net worth of the Indian parent or body corporate.

Requirements of Filing NFRA Form 2

1. Limited Liability Partnership Identification Number (LLPIN) or any other registration Number of the firm
2. Income Tax PAN of Auditor (for Indian firm)
3. Registration number of Auditor with the regulator/agency

Following are the details of the companies that need to be filled in:

1. Name of Company/Body Corporate
2. CIN / PAN of Company /Body Corporate or FCRN of the company or Identity number of body corporate
3. Global Location Number of Company/Body Corporate (if applicable)
4. Details of the Fees received by the Auditor from Company/Body Corporate
5. Currency Conversion rate (if fees received in Foreign Currency)
6. Network Registration Number of the auditor with ICAI
7. Details of the Partners of the auditor
8. Number of employees employed by the auditor
9. Digital Signature Certificate (DSC) of User’

Contents to be filled in the Form 2

1. Identity of the auditor and the contact persons

1. Under this, the auditor should mention Category of auditor, whether it’s individual, firm, foreign LLP or indian LLP.
2. Limited Liability Partnership Identification Number (LLPIN) or any other registration number
3. Name of the Auditor
4. Income Tax PAN of Auditor
5. Details of the Auditor’s registration number as under

• Assigned by: (Give name of regulator/agency who assigns such registration numbers in the jurisdiction of operations)
• Country of registration
• Registration number with the regulator/agency

6. Registered address of the Auditor
7. Mailing address
8. Telephone number of the Auditor’s registered office
9. Website address of the Auditor, if any

2.Reporting Period

Start of reporting period for annual return (01/04/YYYY) and End of reporting period for annual return (31/03/YYYY).

3. General Information Concerning the Auditor

Jurisdictional Information

(a) Quality Control Review by any regulator:

• Yes/No
• Name of Regulator
• Date of review
• Validity period
• Rating and rating scale
• Adverse remarks (if any)

(b) Any other review by other regulators:

• Yes/No
• Name of Regulator
• Date of review
• Validity period
• Rating and rating scale
• Adverse remarks (if any)

Audit Clients and Audit Reports of the Auditor

4(a) For Companies under Rule 3(1)(a)-(d)

For each audited entity:

1. Name of company/body corporate
2. CIN or PAN
3. Global Location Number
4. Class of company:

• Listed company
• Unlisted public company (large)
• Insurance company
• Banking company
• Electricity generation/supply
• Special Act Company
• Body corporate under Sec 1(4)(b)-(f)
• Body corporate referred by Central Government

5. Registered address
6. Date of audit report
7. Engagement Partner: Name & Registration No.
8. Engagement Quality Review Partner: Name & Registration No.
9. Whether audit report modified – Yes/No
10. Fees Received (INR):

11. Exchange rate used (if fees not in INR)
12. Any unfavourable/qualified findings - Yes/No + Details
13. Inability to express opinion - Yes/No + Details

4(b) For Foreign Body Corporates under Rule 3(1)(e)

For each such entity:

1. Name of body corporate
2. FCRN or foreign registration number
3. Global Location Number
4. Registered address
5. Date of audit report
6. Whether report modified- Yes/No
7. Fee details (same 5 categories as above)
8. Exchange rate used
9. Unfavourable/qualified findings- Yes/No + Details
10. Inability to express opinion- Yes/No + Details
11. Whether GAAS followed - Yes/No (If No, specify standard used)
12. Whether GAAP followed- Yes/No (If No, specify standard used)
13. Period of financial statements audited (from-to)
14. CIN/PAN of parent company in India
15. Name of parent company in India
16. Consolidated income of parent
17. Consolidated net worth of parent
18. Income of foreign subsidiary/associate
19. Net worth of foreign subsidiary/associate
20. LLPIN / Registration No. of firm that audited the parent
21. Name of that firm

5. Network Membership & Affiliations

(a) Whether auditor is part of any network- Yes/No (b) If Yes:

● Entity name

● Entity address

● Country

● Description of relationship

● ICAI network registration number (Yes/No)

6. Partners and Employees

6.1 Partners

● Number of partners

● Details: - Name, Registration number (assigned by regulator) and Names of all firms in which they are partners

6.2 Employees

● Total number of Chartered Accountants or equivalent employees

7. Disciplinary / Legal Proceedings

1. Total number of criminal / civil / disciplinary actions against partners/employees in past 5 years For each:

● Nature (Criminal / Civil / Disciplinary)

● Against whom (Partner / Employee)

● Name

● Name of regulator/agency initiating action

● Date of proceedings

● Brief description

● Whether final order passed- Yes/No

8. Special Circumstances

8.1 Resignations (past 3 years)

● Whether auditor resigned - Yes/No

● Number of companies resigned from For each:

● CIN/PAN

● Name of company

● Reporting period for which resignation submitted

8.2 Withdrawal of Audit Report

● Whether audit report withdrawn - Yes/No

● Number of companies For each:

● CIN/PAN

● Company name

● Reporting period (from- to)

8. Quality Control Policies: Description of quality control policies & procedures followed during the year

10. Consent Statement

● Mandatory declaration agreeing to cooperate with NFRA requests

● Signature of Partner or Authorised Officer

11. Signature of the partner or authorised officer.

How to File the Form

NFRA 2 form has to be filed online. You can refer to the following link https://eformnfra2.nic.in/ for e-filing Form NFRA2.

Step 1: Visit the NFRA-2 E-Filing Portal

Go to the official link: https://eformnfra2.nic.in/ (This is the only authorised portal for filing NFRA-2.)

Step 2: Login / Create an Account

● If you are a first-time user, click ‘Register’ and create a login ID.

● Provide basic details such as:

● A verification link/OTP will be sent to your email for activation.

Step 3: Download the Form NFRA-2 Utility

● After logging in, download the NFRA-2 e-form utility (usually in Excel/Java format).

● Ensure the latest version is used, as old versions may be rejected.

Step 4: Fill the NFRA - 2 Form Offline

Fill in all the required sections, including:

● Auditor identity

● Reporting period

● Details of audit clients

● Fees received

● Network affiliations

● Partners & staff details

● Disciplinary actions

● Resignations or withdrawals

● Quality control policies

Step 5: Validate & Generate JSON File

● After completing the form, click ‘Validate’ inside the utility.

● The system will generate a JSON file which needs to be uploaded on the portal.

Step 6: Upload JSON File on NFRA Portal

● Return to the NFRA portal.

● Select ‘Upload NFRA-2 Form’.

● Browse and upload the generated JSON file.

● Ensure all mandatory attachments (if any) are included.

Step 7: E-Verify & Submit

● Submission requires: Digital Signature (DSC) of the auditor or authorised partner, OR E-verification using the method enabled by NFRA.

● After verification, click ‘Submit’.

Step 8: Download Acknowledgment

Once the form is submitted, an acknowledgment/receipt is generated on the screen. Download and save it for compliance records.

Due date for filing NFRA-2 Form

Every auditor referred to in rule 3 shall file a return with the Authority on or before 30th November every year in Form NFRA-2.

Penalty for not filing

As per the amended notification issued in 2022, 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 for every day after the first during which the contravention continues.

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