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CS Professional · Internal and Forensic Audit · Forensic Audit: Laws and Regulations

Mehta Textiles Ltd's board suspects a large diversion of funds by a senior manager. The Central Government decides to set up a body of experts to investigate frauds relating to a company. Under Section 211 of the Companies Act, 2013, which body is established for this purpose?

The Serious Fraud Investigation Office is the body established under Section 211 of the Companies Act, 2013 by notification of the Central Government. Its purpose is to investigate frauds relating to a company, which fits the suspected fund diversion described in the scenario.

  1. ASerious Fraud Investigation OfficeCorrect
  2. BNational Financial Reporting Authority
  3. CRegistrar of Companies, Mumbai
  4. DCost Audit Bureau

Explanation

Section 211(1) states that the Central Government shall, by notification, establish an office called the Serious Fraud Investigation Office to investigate frauds relating to a company. The NFRA deals with accounting and auditing standards and audit quality, not this investigative role under Section 211.

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