NFRA flags audit lapses by Walker Chandiok, releases inspection report
NFRA) on Friday came out with an inspection report on audit firm Walker Chandiok & Co LLP (WCCL), flagging lapses, including the “lack of integration between electronic and paper files” and rendering of non-audit services prohibited under the Companies Act, 2013, in two instances.
The regulator said the audit documentation of the firm comprises electronic audit documentation and physical files. The lack of integration between electronic and paper files poses risks of non-compliance with audit standards and quality control and “raises concerns about the reliability of audit documentation”, it added.
It said Grant Thornton Bharat LLP (GTBL), Grant Thornton Advisory Private Ltd (GTAPL) and Grant Thornton International Limited (GTIL) are related entities of WCCL either “directly or indirectly” as per explanation to the Section 144 of the Companies Act, 2013.
These entities are also part of a large global “GTIL Network” as per the standard on Quality Control (SQC) 1.
“However, the firm (WCCL) denied the existence of direct or indirect relationship and network,” the NFRA said.
It further said that WCCL, controlled by Vinod Chandiok, declared in its filings with the Public Company Accounting Oversight Board (PCAOB) that it had no audit related memberships, affiliations or similar arrangements with any other entity. However, GTBL, which is controlled by his son Vishesh Chandiok, has declared in its filings with the PCAOB that it had “audit related memberships, affiliations or similar arrangements” with WCCL and the global network namely GTIL, it added.
Responding to ET on the NFRA report, a WCCL spokesperson said, “We believe in accountability and integrity towards our stakeholders and the significant professional
