How the orders are enforced in disciplinary proceedings under Rule 12 of NFRA Rules?
CS Professional · Governance, Risk Management, Compliances and Ethics · PYQS · June 2025
How the orders are enforced in disciplinary proceedings under Rule 12 of NFRA Rules?
Answer & Explanation:
Manner of enforcement of orders passed in disciplinary proceedings - Rule 12 of NFRA Rules: Where the order passed under rule 11 relates to imposition of a monetary penalty on any auditor, the auditor shall deposit the amount of penalty with the Authority within thirty days of the order: Provided that where the auditor prefers an appeal against the order of the Authority, it shall deposit ten percent of the amount of the monetary penalty with the Appellate Tribunal. If, within thirty days of the order passed under rule 11, the auditor neither pays the penalty nor appeals against the order, the Authority shall, without prejudice to any other action, inform about such non-compliance to every company or body corporate (including those not covered by rule 3) in which the auditor is functioning as auditor and every such company or body corporate shall appoint a new auditor in accordance with the provisions of the Act. Where the order passed under rule 11 imposes a penalty on the auditor or debars the auditor from practice, the order shall be sent to every company or body corporate in which the auditor is functioning as auditor. Where the order passed under rule 11 debars the auditor from practice or the order under sub-rule (2) is passed, the order shall be sent to every company or body corporate (including those not covered by rule 3) in which the auditor is functioning as auditor and every such company or body corporate shall appoint a new auditor in accordance with the provisions of the Act.
Topics: Regulatory Bodies
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