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CMA Intermediate · Corporate Accounting and Auditing · National Financial Reporting Authority (NFRA)

NFRA proves misconduct by an audit firm and debars it under section 132(4)(c)(B). Which debarment is permissible under the section?

Debarment must be for at least six months and may be set by NFRA at a higher period not exceeding ten years. It bars the member or firm from audit, internal audit appointments and from performing valuation under section 247.

  1. AThree months, with no upper limit
  2. BAny period up to five years, with no minimum
  3. CA minimum of six months and a maximum of ten yearsCorrect
  4. DA minimum of one year and a maximum of fifteen years

Explanation

The debarment is for a minimum of six months or such higher period not exceeding ten years as NFRA determines. It covers appointment as auditor or internal auditor, undertaking audits, and valuations under section 247.

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