The Institute of Chartered Accountants of India (ICAI) has tied up with Securities and Exchange Board of India (SEBI) to detect corporate frauds after two prominent cases of financial irregularities were detected at IndusInd Bank and Gensol Engineering. Under the proposed agreement, the ICAI will prepare a working paper on potential areas where the two entities can work. “We will form a research group within ICAI to identify areas where ICAI can have a meaningful discussion with SEBI. India is a favourable investment destination. It is important for SEBI to ensure that investments are safe. As a regulator for accounting, they always want to rope in ICAI so that we can together create an environment which can reduce the number of frauds,” said Charanjot Singh Nanda, president of ICAI on Saturday.
Last week, the financial reporting review board (FRRB) at ICAI said that it is reviewing the financial statements and statutory auditor’s report of Gensol Engineering and its affilate firm BluSmart Mobility. Nanda said that the review is likely to be completed in the next 6 months. FRRB officials said that the review process is a rigorous, three-tier exercise.
Prior to the ICAI’s decision, the ministry of corporate affairs (MCA) had said that it is reviewing SEBI’s interim order against Gensol Engineering over alleged fund diversion and forged documents.
The Gensol‘s fraud caught the market regulator’s attention in 2024 when it received a complaint relating to manipulation of share price and diversion of funds in the company. In mid April, SEBI came out with an interim order that restrained the promoters of Gensol – Anmol Singh Jaggi and Puneet Singh Jaggi – from holding any key managerial positions in the company besides prohibiting them from dealing in securities market.
The ICAI president said that the institute is simultaneously working on the financial aspects of the ‘One nation, one election’ proposal which is under consideration.