NFRA Conducted 19 Major Audit & Reporting Reviews in Five Years: Reports [Read Order]

The National Financial Reporting Authority ( NFRA ) has carried out 19 major reviews and inspections over the last five financial years, according to data presented before the Lok Sabha.

As per the data, NFRA undertook one AQR each in FY 2019-20 and FY 2020-21, along with one supplementary AQR in FY 2020-21. The regulator expanded its oversight in FY 2021-22, conducting two AQRs and two FRQRs, ticking one of its most active review years.

In FY 2022-23, NFRA performed 1 AQR and 2 FRQRs and In the subsequent years, NFRA moved to full-scale Audit Quality Inspections, carrying out 5 inspections in FY 2023-24 and 7 inspections in FY 2024-25, the highest in the five-year period. The total of these reviews and inspections is 19.

NFRA’s performance is monitored under a Memorandum of Understanding (MoU) signed with the Ministry of Corporate Affairs. The MoU states clear performance guidelines, annual output targets, quality expectations, and corresponding resource allocation ensuring that NFRA’s regulatory functions remain aligned with national objectives for audit integrity and financial reporting transparency.

The Ministry clarified that NFRA has not partnered with any academic or professional institution for developing research in financial reporting standards. However, it has taken up extensive capacity-building efforts, including engaging CEOs, CFOs, independent directors, auditors, and committees through webinars, circulars, and a high-profile international conference held in 2024.

NFRA also released periodic guidance including the Auditor-Audit Committee Interaction Series to improve communication and audit results. Additionally, it has partnered with the Indian Institute of Corporate Affairs (IICA) to launch a four-month capacity-building programme for independent directors and audit committee members., added the Ministry.

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