NEW DELHI: The National Financial Reporting Authority (NFRA) has imposed a fine of Rs 2 crore on Deloitte Haskins & Sells as well as penalties on two chartered accountants for lapses in auditing of Zee Entertainment Enterprises during the 2018-19 and 2019-20 financial years
Along with slapping a fine of Rs 10 lakh, A B Jani has been barred from taking up any audit work for 5 years, while the fine is Rs 5 lakh on Rakesh Sharma, and the debarment period is 3 years.
Jani was the Engagement Partner (EP), and Sharma was the Engagement Quality Control Review (EQCR) Partner for the audit of the company for 2018-19 and 2019- 20.
In its probe, NFRA found Deloitte and CA AB Jani committed professional misconduct under provisions of the Companies Act, 2013, which states that a CA is guilty of professional misconduct when he “fails to disclose a material fact known to him which is not disclosed in a financial statement, but disclosure of which is necessary in making such financial statement where he is concerned with that financial statement”.
NFRA said the charge against the two is proved since Deloitte and Jani failed to disclose absence of an actual reason for closure of a fixed deposit and failed to consider in audit report the impact of the absence of sufficient appropriate audit evidence regarding the FD matter.