NFRA Finds Audit Lapses at Six Firms, including Deloitte and Walker Chandiok
With NFRA tightening the screws, India’s audit landscape is poised for a shake‑up that may redefine the relationship between auditors, their clients, and the broader corporate ecosystem.
India’s audit regulator, the National Financial Reporting Authority (NFRA), has intensified its scrutiny of the country’s largest audit firms, releasing inspection reports on six major players that reveal persistent gaps in quality control and compliance with statutory standards.
The firms under the spotlight include Deloitte Haskins & Sells, Walker Chandiok & Co., Singhi & Co., BDG & Co., CNK & Associates, and Umamaheswara Rao & Co.
The regulator’s findings highlight deficiencies in governance frameworks, internal controls, and risk assessment systems across these firms. NFRA noted that several audit engagements failed to meet expected standards, raising concerns about the robustness of audit practices in India’s corporate sector.
The report also pointed out the issues around non-audit services provided by audit firms to their clients, warning of potential conflicts of interest and breaches of Section 144 of the Companies Act, which restricts auditors from offering certain services to companies they audit.
Also read: NFRA to Inspect Audits of 35 - 40 Companies in FY 26
Deloitte, one of the firms singled out, faces particular scrutiny over services rendered by its global network. NFRA questioned whether such arrangements compromise auditor independence, especially when management advisory services are involved. Deloitte responded by asserting compliance with existing regulations and sought further guidance from the regulator on the scope of “management services.”
Walker Chandiok & Co., affiliated with the Grant Thornton International Network, was cited for independence concerns tied to its global affiliations. NFRA observed that such relationships could blur the lines between audit and consulting, undermining the credibility of statutory audits. Similar observations were made in relation to Singhi & Co. and other firms, where weaknesses in quality control systems were deemed inconsistent with international best practices.
The latest round of inspections follows earlier reports that scrutinized affiliates of PwC, BDO, EY, and KPMG, signaling NFRA’s determination to enforce higher standards across the profession.
By systematically examining both global networks and domestic firms, the regulator is sending a clear message that lapses in audit quality will not be tolerated.
Support our journalism by subscribing to Taxscan premium. Follow us on Telegram for quick updates
