Page 13 - Banking Finance November 2024

ROUNDUP

Industrial Production, which measures
factory output growth. UPS won't overburden the fiscal
The Unified Pension Scheme (UPS), which guarantees 50% of pay as a pen-
The Ministry is also set to publish flash
employment-unemployment data sion, will take care of the government employees' interest as well as the
from February next year. taxpayers' interest by not overburdening the future generations with a heavy
pension bill, Finance Minister Nirmala Sitharaman said.
A key criterion for selection of base
year for computation of economic data In the recent budget, the government announced UPS for central govern-
is that it should be a 'normal' year - ment employees effective April 1, 2025 but covers all staff who joined the
which has not had much disruptions at National Pension System (NPS) since 2004. The state governments can also
domestic and global levels. "It is not adopt UPS for their staff under NPS.
easy to consider a year as normal year "It has the best elements, I would think of, Old Pension Scheme (OPS), and
considering happenings at the global NPS, and it provides an assured pension after retirement, which is what OPS
level. Still, a choice has to be made," did, but here it also has other features," Sitharaman said at the launch of
the official told. NPS Vatsalya- a pension scheme for children below the age of 18 years. The
minimum contribution for the scheme is Rs 1,000 annually and pension would
Factoring all this, MoSPI has proposed
2022-23 as the new base year for con- accrue after 60 years of age.
sideration of the Advisory Committee
on National Account Statistics (ACNAS). sponsibility for consolidated financial vouchers of the company, including
statements lies with the management right of access to the records of all the
The 26-member ACNAS, under the and board of directors of the holding subsidiaries of the companies in so far
chairmanship of Prof Biswanath Goldar, company and the principal auditors". as it relates to the consolidation of its
comprises academics, National Statis- financial statements with that of its
tical Commission and Indian Statistical In a 12-page circular, it cited gaps in
the audit of fraud hit companies, in- subsidiaries," the circular said.
Institute (ISI) along with officials from
Reserve Bank of India (RBI), Ministries cluding IL&FS, Cafe Coffee Day, DHFL
of Finance, Corporate Affairs, Agricul- and ADAG's Reliance Capital, Reliance ITC on construction cost
ture, NITI Aayog and selected State Home Finance and Reliance Commer- for commercial buildings
governments. The panel first met last cial Finance to point out how investors
month and will meet regularly and de- had lost thousands of crores as audi- In a boost to commercial real estate
liberate on various aspects of base re- tors failed to assess gaps. and infrastructure projects, the Su-
vision. It underlined that Standard on Audit- preme Court ruled that if the building
ing (SA) 200 required auditors to is constructed for supplying services
Principal auditor respon- "maintain professional skepticism". such as renting or leasing out, it can
Referring to SA600, the agency be regarded as a plant and input tax
sible for fin statement: pointed out that auditors cannot re- credit (ITC) under GST will be eligible.
NFRA sort to its "selective" application in However, it rejected constitutional

The National Financial Reporting Au- group audits. It also dismissed inter- validity challenge to blocked credit
thority (NFRA), the regulator for audi- pretations by auditors, who argued provisions in the GST law.
tors and audit firms for large and listed that the provisions of the standard "If the construction of a building was
companies, made clear that the prin- were not mandatory. essential for carrying out the activity
cipal auditor will be responsible for the NFRA also brushed off suggestions that of supplying services, such as renting or
consolidated financial statement in the principal auditor is barred from re- giving on lease or other transactions in
case of group audits after it noticed viewing the work papers of auditors of respect of the building or a part
several attempts to shift the blame to subsidiaries or JVs, saying it is provided thereof, the building could be held to
those dealing with subsidiaries and under the law as was in SAs. "Section be a plant," a division Bench compris-
joint ventures. 143 of the Companies Act 2013 grants ing Justices Abhay S Oka and Sanjay

The agency underlined that the "re- auditors right of access to all books and Karol said.

12 | 2024 | NOVEMBER | BANKING FINANCE