S Ltd. appointed M & Co., Chartered Accountants, as statutory auditors for the financial year 2021-22. During the audit, the statutory auditors have noticed fake and duplicate expenses reimbursement of ₹ 1.10 crore t

Reporting of frauds by auditor involving amount more than ₹ 1 crore As per section 143 (12) read with rule 13 to the Companies (Audit and Auditors) Amendment Rules, 2014, if an auditor of a company, in the course of the performance of his duties as statutory auditor, has reason to believe that an offence of fraud, which involves or is expected to involve individually an amount of rupees one crore or above, is being or has been committed against the company by its officers or employees, the auditor shall report the matter to the Central Government. Auditor should report such frauds as soon as possible but not later than 60 days of his knowledge about the frauds: STEP-I - Report to Board & Audit Committee Auditor shall forward his report to the board of directors or the audit committee, as the case maybe, within 2 days of his knowledge of the fraud, seeking their reply or observations within 45 days. STEP-II - Report to Central Government after reply of board On receipt of such reply or observations, the auditor shall forward his report and the reply or observations of the board or the audit committee along with his comments (on such reply or observations of the board or the audit committee) to the Central Government within 15 fifteen days of receipt of such reply or observations. STEP-III - Report to Central Government if no reply received In case the auditor fails to get any reply or observations from the board or the audit committee within the stipulated period of forty-five days, he shall forward his report to the Central Government along with a note containing the details of his report that was earlier forwarded to the board or the audit committee for which he failed to receive any reply or observations within the stipulated time. Other Points to be kept in mind: The report shall be on the letter-head of the auditor containing Postal address; e-mail address; contact number (telephone/ mobile); signed by the auditor with his seal; indicate his membership number. Report shall be in the form of a statement as specified in Form ADT-4.