CA Institute issues show cause notice to PNB's Central Statutory Auditors

Paola Ditto
Febbraio 25, 2018

While various investigating agencies have initiated their investigations in the matter, the Disciplinary Directorate of ICAI suo motu has also started its investigation as per the Chartered Accountants Act, 1949 and rules framed thereunder.

The ICAI, which functions under the administrative control of India's Ministry of Corporate Affairs, said it has set up a committee to study the systemic lapses that contributed to the fraud and to suggest remedial measures and improvement.

The ICAI has also written letters to Security and Exchange Board of India (SEBI), Central Bureau of Investigation (CBI), Enforcement Directorate (ED) and Punjab National Bank (PNB), urging them to share details of Rs. 11300 crore PNB scam. The first meeting of the group is scheduled on 23rd Feb 2018. "The officers of PNB were called by ICAI to appear and produce copy of all related documents in the said frauds". Similarly, Central Statutory Auditors who have done quarterly review of PNB have also been issued Show Cause Notice. Choksi has not commented but his firm, Gitanjali Gems, has also denied involvement in the alleged fraud.

The Institute of Chartered Accountants of India (ICAI) on Thursday said it has written to the RBI, seeking a list of corporate borrowers of public sector banks with over Rs 2,000-crore loan outstanding, so that their accounts can be examined by the Financial Reporting Review Board for any possible violation of accounting standards as well as auditing.

"As such, ICAIs commitment to be pro-active regulator of the auditing and accounting profession through investigation is to ensure accelerated conclusion of proceedings and take action against those members of chartered accountant profession who are involved in the fraud at PNB".

The stock hit an intraday high of Rs. 116.7 and intraday low of 113.7.

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