Jagran Bureau, New Delhi. The Chartered Accountant (CA) needs to be very careful and honest during the audit of the firm. Strict action has been initiated against him for professional misconduct. The National Financial Reporting Authority (NFRA) has imposed a one-year ban on a CA along with a fine of Rs 1 lakh for professional misconduct. For the first time such action has been taken against any CA by NFRA.

NFRA was constituted under the Companies Act in October 2018 to protect the interests of investors and creditors and to investigate audits in companies. The NFRA can ban a CA for a maximum period of ten years on charges of professional misconduct.

CA banned for one year, fined one lakh

NFRA Chairman Ajay Bhushan Pandey, in his judgment dated June 21, said that during the audit of the company, professional misconduct of CA Gulshan Jagdish Jham was proved. Therefore, a fine of one lakh rupees is imposed on him and he is also banned for one year. For one year, Jham will not be able to audit any company or issue any financial statements in favor of anyone.

Know what is the matter

According to the NFRA’s decision, on March 22 this year, a show cause notice was issued to Jham in connection with the audit of Prabhu Steel Industries Ltd, asking him why action should not be taken against him in the matter. According to the case, the CA, knowing about the company’s mistakes in its report, did not highlight it. CA also did not release the company’s irregularities in its report regarding things like property, debt, stock. Due to all these factors, the company’s profits were shown to be inflated and this affected the interest of the investors and the lenders. Jham had accepted his mistake.

Edited By: Sanjeev Tiwari