Section 132 of CA 2013 : Section 132: Constitution Of National Financial Reporting Authority

Explanation using Example

Imagine a scenario where the Central Government, observing the need for uniformity in accounting and auditing practices across companies in India, decides to establish the National Financial Reporting Authority (NFRA) under Section 132 of the Companies Act, 2013.

Once established, the NFRA starts functioning and sets up divisions to handle different aspects of its mandate. For instance, one division focuses on setting accounting standards while another monitors compliance.

The NFRA then discovers that a particular auditing firm has been consistently failing to adhere to the prescribed auditing standards. The firm is alle...

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