The National Advisory Committee on Accounting Standards (NACAS) has been reconstituted. It will now be headed by Mr M.M. Chitale, a chartered accountant. The term of the reconstituted Committee will be up to February 28 next year, according to the Corporate Affairs Ministry. The Committee’s advice forms the basis for deciding accounting standards and policies to be followed by corporates. This will be a second stint for Mr Chitale, a former CA Institute President. He was appointed as Chairman of this advisory panel for a year in January last year. The reconstituted Committee will have 12 members, including the Chairman. It will also have two special invitees: Mr G. Ramaswamy, former President of Institute of Chartered Accountants of India (ICAI), and Mr Suresh Senapati, Chief Financial Officer of Wipro.
This time around, there has been only minimal change to the constituents with as many as seven members of last year’s panel getting re-appointed. The Presidents of all the three professional institutes — ICAI, Institute of Cost Accountants of India and Institute of Company Secretaries of India — are on the reconstituted panel. The members who got re-appointed are Mr P.R. Ravi Mohan, Chief General Manager of RBI (RBI nominee); Ms Usha Narayanan, Executive Director, Securities and Exchange Board of India; Mr Ashok Haldia (Assocham nominee); Mr S. Santhanakrishnan (CII nominee); Mr Sunil Gupta, Joint Secretary, Central Board of Direct Taxes; and Ms Renuka Kumar, Joint Secretary, Ministry of Corporate Affairs. The Centre’s move to reconstitute the Committee comes at a time when the Government is looking to enact a new company law. The Standing Committee on Finance, which went into the Companies Bill 2009, had recommended that the role of the Committee be expanded. The Parliamentary panel had in its report submitted to the Lok Sabha in August last year recommended that sufficient mandate be given to the Committee to oversee the accounting and auditing standards and also to review the quality of the audits undertaken. Currently, the Committee has the mandate to advice the Government only on accounting standards and policies. It does not look into the standards or quality of audits undertaken by chartered accountants. The ICAI is not in favour of enhancing the scope of the Committee to cover standards. –

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