The market watchdog SEBI has taken a decision to appoint auditors to perform forensic audit of financial statements of listed companies to put a check on rising frauds. Of late, concerns regarding some of the auditors' negligence have come up wherein they ignore different inconsistencies in the financial statement while examining the books of listed entities. The move comes at a time when SEBI has put the directive to conduct forensic audit of some of the firms that include Fortis Healthcare.
Also Read: What is Forensic Audit?
For the same, the eligible Chartered Accountancy firms have been asked to file application to perform forensic audit of earnings of these listed companies. To meet the eligibility criteria, the firm should have at least 10 years of experience in auditing or forensic audit. At the same time, the Chartered Accountancy establishment needs to have 5 partners or directors at the minimum who need to be involved in such forensic audit work.
Also, the applicant CA firm needs to have as many as 10 employees with relevant qualification, skills and experience to perform the forensic audit task. Also, they need to have prior experience in the area of forensic audit with any of the public sector enterprise, government agency or regulatory body.