The Authority shall have power to monitor and enforce compliance with accounting standards and auditing standards to the following classes of companies-
companies whose securities are listed on any stock exchange in India or outside India;
National Financial Reporting Authority have below power to impose fine/penalty
(1) For the purpose of recommending accounting standards or auditing standards for approval by the Central Government, the Authority-
(a) shall receive recommendations from the lnstitute of Chartered Accountants of India on proposals for new accounting standards or auditing standards or for amendments to existing accounting standards or auditing standards;
(b) may seek additional information from the Institute of chartered Accountants of India on the recommendations received under clause (a), if required.
(2) The Authority shall consider the recommendations and additional information in such manner as it deems fit before making recommendations to the Central Government.
Power to investigate under NFRA.-
(1) Where the Authority has-
(a) received any reference from the Central Government for investigation into any matter of professional or other misconduct under sub-section (4) of section 132 of the Act;
(b) decided to undertake investigation into any matter on the basis of its compliance or oversight activities, or
(c) decided to undertake suo motu investigation into any matter of professional or other misconduct, after recording reasons in writing for this purpose,it shall forward the matter to its Division dealing with enforcement for carrying out investigation and other action.
(2) lf, during the investigation, the Authority has evidence to believe that any company or body corporate has not complied with the requirements under the Act or rules which involves or may involve fraud amounting to rupees one crore or more, it shall report its findings to the Central Government.
(3) On the commencement of these rules-
(a) the action in respect of cases of professional or other misconduct against auditors of companies referred to in rule 3 shall be initiated by Authority and no other institute or body shall initiate any such proceedings against such auditors:
Provided that no other institute or body shall initiate or continue any proceedings in
such matters of misconduct where the Authority has initiated an investigation under
(b) the action in respect of cases of professional or other misconduct against auditors of companies or bodies corporate other than those refened to in rule 3 shall continue to be proceeded with by the Institute of Chartered Accountants of India as per provisions of the chartered Accountants Act, 1949 and the regulations made thereunder.
Role of chairperson and full-time members.-
All matters related to, investigation, monitoring, enforcement and disciplinary proceedings shall be examined and decided by the chairperson or any one or more of the full-time members, acting through one of the Divisions.