The comptroller and auditor general of India
office have recently invited applications from the Chartered accountants Firms/
LLP for the year 2015-16. The online application format shall
be available from 1st January 2016 to 15th February 2016; the firms/LLPs can
apply/update the data showing the status of their firms as on 1st January
2016.The empanelled firms may get the audits for the year 31st March
2017. After filling/updating the data,
It is required to generate an online acknowledgement letter for the year,
followed by submitting the hard copies of the relevant documents in support
along with a print out of the acknowledgement letter generated online. It is not necessary that all empanelled
firms are allotted PSU audits as the allotments are provided on the basis of
ranking/points i.e., merit of the firms.
RANKING
POINTS
Appointments are
generally made based on the ranking points of the firm. The top most ranking
firms get the audit based on the geographical presence preferably from local
limits. There is a set pattern and ranking points can be seen at your dedicated
page at the site. The said information is followed by Empanelment Status, Audit
Allotment Status, previous allotments and eligibility for major audit if
eligible. There is a transparent mechanism in work and everything is displayed
on site.
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Experience (in Yrs)
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:
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22
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[0.5pt for every year- Maximum 15
pts]
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:
|
|
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Full time FCA Partners
|
:
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2
|
[5pt each for first 5 partners and
2.5pt each for rest of the partners]
|
:
|
|
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FCA Partners above 25 yrs
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:
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0
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[5pt each partner]
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:
| |
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Below 25 yrs and above 20 yrs
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:
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2
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[4pt each partner]
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:
| |
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Below 20 yrs and above 15 yrs
|
:
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0
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[3pt each partner]
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:
|
|
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Below 15 yrs and above 10 yrs
|
:
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0
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[2pt each partner]
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:
| |
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Below 10 yrs and above 5 yrs
|
:
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0
|
[1pt each partner]
|
:
|
|
|
Full time ACA Partners
|
:
|
1
|
[3pt each for first 5 partners
(including FCA partners) and 1.5pt each for rest of the partners]
|
:
| |
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ACA Partners above 25 yrs
|
:
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0
|
[5pt each partner]
|
:
| |
|
Below 25 yrs and above 20 yrs
|
:
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0
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[4pt each partner]
|
:
|
|
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Below 20 yrs and above 15 yrs
|
:
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0
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[3pt each partner]
|
:
| |
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Below 15 yrs and above 10 yrs
|
:
|
0
|
[2pt each partner]
|
:
|
|
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Below 10 yrs and above 5 yrs
|
:
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0
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[1pt each partner]
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:
|
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Full Time CA Employees
|
:
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1
|
[1pt for each CA Employee (Maximum 20
points)]
|
:
|
|
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CISA/ISA Qualified Partners
|
:
|
1
|
[2 pt for each partner - maximum 6
pts]
|
:
|
|
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CISA/ISA Qualified Employees
|
:
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0
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[1pt each Employee - maximum 3 pts]
|
:
| |
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Total
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:
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POLICY OF EMPANELMENT OF CA FIRMS AND
SELECTION OF AUDITORS OF PSUS
Chartered Accountant firms in India with at least one full time [1] FCA (Partner/Sole Proprietor) can apply for empanelment with this office for allotment of audit of Public Sector Undertakings. The criteria for empanelment and selection of statutory auditors have been arrived at after due consultation with the Institute of Chartered Accountants of India.
Selection of ca firms for appointment as statutory auditors of psus whose audit fees are up to rs 1.50 lakh
The selection is made by correlating the point score earned by each firm of Chartered Accountants towards empanelment with the size of the audit fee. The point score[2] is based upon the experience of the firm, number of partners and their association [3] with the firm, number of Chartered Accountant employees, as detailed below:
|
Experience
of the firm
|
0.5
point for every calendar year -Maximum 15.
(Counted
from the date of constitution of the firm with one full time FCA or date of
joining of the firm by the existing partner having the longest association
with the firm whichever is later.)
|
|
Full
Time FCA Partners
|
5
points each for first 5 partners and 2.5 points each from 6th
partner onwards.
|
|
Full
Time ACA Partners
|
3
points each for first 5 partners (including FCA partners) and 1.5 points each
from 6th partner onwards.
|
|
Points
for long association with the same firm
|
5
points for each partner above 25 years.
|
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4
points for each partner above 20 years.
| |
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3
points for each partner above 15 years.
| |
|
2
points for each partner above 10 years.
| |
|
1
point for each partner below 10 Years but above 5 Years.
| |
|
Full
Time CA Employees
|
1
point each for first 20 C.A Employees-Maximum 20 points
|
|
CISA/ISA
Qualified Partners
|
2
points each for three partners. -maximum 6 points
|
|
CISA/ISA
Qualified Employees
|
1
point each – Maximum 3 points for 3 employees.
|
Selection of ca firms for appointment as statutory auditors of psus where audit fee is above rs 1.50 lakh (major audits)
(a) Criteria for short-listing eligible firms of CAs for allotment of Major Audits are as under:
(i) The firm should have at least 6 CAs (out of which 5 should be full time partners and one could be a full time paid CA employee), which is indicative of capacity to handle big audits.
(ii) At least one partner should have an association of 10 years or more with the firm and at least 3 partners of the firm should have an association of 5 years or more with the firm and the remaining two should have an association of one year or more with the firm, to demonstrate stability over time.
(iii) The firm itself should have been in existence for 10 years or more, to prove that it is a well established firm.
(b) Allotment of major audits is based not only on the size of the firm considering the number of partners, and their association with the firm, number of Chartered Accountant employees, and the Zone in which the firms’ head office is located but also on the basis of factors such as sectoral experience, service tax paid by the firm on assurance services, capability of handling big audits, past performance, eligibility of the firm to conduct a particular audit, location of the firm’s branch offices etc.
[1] Full time partner does not include
A person who is
(a) a partner in other firms
(b) Employed full time/part time elsewhere, practicing in their own name or engaged in practice otherwise or engaged in other activity which would be deemed to be in practice under Section 2(2) of the Chartered Accountants Act, 1949.
(c) i) Partners whose total compensation@ from the firm is below the following limit:
Head office of the firms located in Delhi, Mumbai, Chennai, Kolkata, Bangalore and Hyderabad:
ACA partner Rs. 1.80 lakh in a year (Rs. 15000/- per month)
FCA partner Rs. 3.00 lakh in a year (Rs. 25000/- per month)
Head
office of the firms located other Places:
ACA partner Rs. 1.20 lakh in a year (Rs. 10000/- per month)
FCA partner Rs. 1.80 lakh in a year (Rs. 15000/- per month)
(c) ii) A partner whose total compensation@ from the firm is less than:
Firms having more than 14 partners 1%
Firms
having 10 to 14 partners 3%
Firms having 5 to 9 partners 5%
Firms having less than 5 partners 8%
@Total compensation = Sum total of share of profit, remuneration and interest on capital.
[2] All members (sole proprietors/partners/ CA employees) will get points if they were exclusively associated with the firm throughout the calendar year immediately preceding the year of empanelment.
[3] In case of merger, the partners of the merging firms will be assigned points after one year of merger and points for partner’s association to be given after five years from the date of merger.
CONDITIONS
FOR THE AUDITORS
1. The Auditors may please
intimate their acceptance as auditors of the Company within 3 weeks of receipt
of this appointment letter (i) to the Company (ii) to this Office (iii) to the
concerned MsAB/PAsG/AsG entrusted with the Supplementary Audit of the Company.
If, for any reason the Auditors are not in a position to accept the appointment,
they may intimate all the above-mentioned offices immediately along with the
reasons for their decision.
2. The appointment /
re-appointment of auditors is subject to their performance in the previous
years’ audit being adjudged as satisfactory by the DG/PAG/AG /MAB concerned.
3. The
appointment/re-appointment of auditors is subject to the Auditors making the
following declarations/undertakings:
(i) That the firm/LLP is not
disqualified under section 141 of the Companies Act, 2013
(ii) That no unreasonable TA/DA, out of pocket
expenses will be claimed from the company. In cases where audits are allotted
to the Branch office of the CA Firm no TA/DA should be claimed by the CA firm
from the company for the audit of the Company/Units located at the same station
of the branch.
(iii) That during the year of audit, and for one year
after (to be counted from the date of conclusion of the relevant Annual General
Meeting of the Company) the Firm/LLP ceases to be Auditor, no assignment for
internal audit or consultancy or other services i.e. accounting and book
keeping services, design and implementation of any financial information
system, actuarial services, investment advisory services, investment banking
services, rendering of outsourced financial services, management services etc.
to the company or its holding company or partly owned subsidiaries of the
Company (irrespective of the shareholding) or joint ventures of the Company
whether under production sharing contract or otherwise will be accepted
directly or indirectly as per explanation given under section 144 of the
Companies Act, 2013 by the firm/LLP. Non-audit assignments that involve
performing management functions or making management decisions and audit of
annual accounts of subsidiary companies (irrespective of the
shareholding)/Joint Ventures/Associates are also prohibited during the year of
audit and for one year after the firm/LLP ceases to be auditor. This condition
would not apply to assignments for the tax audit under Income Tax Act, VAT
audit required under various State Legislations, review of Quarterly/half
yearly accounts as per SEBI guidelines and other statutory certificates related
to the audit assignment.
(iv)
That no partner/chartered accountant
employee of the firm of auditors/LLPs has been held guilty of professional
misconduct by the Institute of Chartered Accountants of India during last year
(in case any partner of the firm/LLP has been held guilty of professional
misconduct by the Institute of Chartered Accountant of India, please furnish
details thereof).
(v) The audit would not be done by a person (i) who is neither a partner nor
an employee of the CA firm/LLP to which the audit has been allotted; (ii) who
was earlier associated with the audit of the said PSU as a partner/employee of
the retiring auditor.
(vi) No partner of the Chartered
Accountant firm/LLP would hold post of Director (except in the case of
financial companies) or undertake audit or any other job/assignment of any
Private organization/ Company which is in the same line of business or industry
as that of the PSU.
3(a) The
auditors may start the audit of the Company immediately on receipt of the
accounts of the Company. However, they should certify the accounts for the year
only after the audited accounts for the previous year has been laid before the
AGM for their consideration. In case audited accounts of the previous years has
been considered but finally not adopted by the shareholders, the auditor can
certify the accounts of the succeeding year indicating the fact of the
non-adoption of the previous years accounts in their report.
3(b) The
time schedule for conducting the audit may be drawn up with scheduling of audit
i.e indicating the period of audit of different departments/ units of the PSU
and also the name of personnel & their qualification who will be deployed
for audit of each unit. A copy of the time schedule so fixed may be sent to the
concerned MAB/ AG so that they may also draw their time schedule for supplementary
audit.
3(c) The
Auditor must complete the audit of the units/branches allotted to them within
the time schedule stipulated by the management so that the statutory time
schedule for placing the accounts in the AGM could be adhered to.
4. Record
of audit work done in the form of working papers should be retained with
sufficient information so as to support the auditors’ significant conclusions
and judgments.
5. The
Auditors shall have to comply with the directions issued by this office under
143(5) of the Companies Act, 2013. The remuneration is inclusive of the fee on
account of the additional work involved in this regard. Directions under
section 143(5) is available at this office’s official website i.e. www.
saiindia.gov.in (Chartered Accountants Corner)
6. Statutory
auditors of the companies who have adopted SAP should deploy at least one
partner/employee having ISA/CISA qualification to conduct the audit.
7. The
Company/Auditors will have to comply with the other provisions of the Companies
Act, 2013 as may be required, which are not specifically covered above.
GENERAL INSTRUCTIONS
TO FILL APPLICATION FORM
·
Chartered Accountant firms (firm) and Limited Liability Partnership firm (LLP)
in the country with at least one full time FCA (Partner/Sole Proprietor)
as on 1st January 2015 can apply for empanelment with the office of
the CAG of India for allotment of audit of Public Sector Undertakings/Statutory
Corporations for the year 2015-2016.
·
The firms who intend to be empanelled with this office need to submit their
application online from 1st January to 15th February 2015
on the website www.saiindia.gov.in. It is advised to submit the application
well in advance to avoid last minute rush.
· The information to be given in the
application should be the position as on
1st January 2015. Firms that are already empanelled with the CAG’s office need only to modify the information that is already available in the application format for changes if any, reflecting the status of such firms as on 1st January 2015.
1st January 2015. Firms that are already empanelled with the CAG’s office need only to modify the information that is already available in the application format for changes if any, reflecting the status of such firms as on 1st January 2015.
·
Firms that are seeking empanelment for the first time should provide
information as on 1st January 2015.
·
The information filed online in the application can be edited/modified any
number of times till last date of submission.
·
Please fill up e-mail ids and mobile numbers correctly as userid/password will
be communicated through these modes.
·
All applicant firms will be given unique online acknowledgement number for the
year 2015-16 and only firms that have generated the online
acknowledgement number for the year 2015-16 will be considered for empanelment.
·
The online data submitted by the CA firms should match with the updated data of
the firm available with the Institute of Chartered Accountants of India showing
the position as on 1st January 2015. It may however be noted that
any changes in data occurring after the cut-off date of 15th
February 2015 that lead to reduction in the rank of the applicant firm shall be
taken into account.
The firms who have submitted the online
application form are required to furnish the following documents, which should
reach this office by 15th March 2015.
(i)
Online acknowledgement letter for the year 2015-16 generated at the time of
filing online application.
(ii)
Statement I: Undertaking signed by the sole proprietors/partners of the
firm/LLP as per format.
(iii)
Statement II: Signature of CA employees of the firm/LLP.
(iv)
Copy of the Income Tax return of the firm along with computation for the
assessment year 2014-15 including distribution of income to partners.
(v)
Income tax return for the assessment year 2014-15 of those CA employees who
have joined as partners in the firm after 1st April 2013.
(vi)
Copy of the annual accounts of the firm for the financial year 2013-14 along
with schedules indicating the distribution of income among the partners.
(vii)
Copy of the Service tax return filed by the firm for the year 2013-2014. In
case numbers of returns are more than two, summary sheet may also be
attached.
(viii) In
case of CISA qualified members, copy of the final CISA certificate
granted by the “Information Systems Audit and Control Association” after
successfully meeting all requirements.
(ix)
Duly filled up check list of the documents as per format. (To be placed on the
top).
(x)
Self addressed acknowledgement form for receipt of documents as per format.
·
The above documents should be addressed to:
Director General
(Commercial)-I,
Office of the
Comptroller & Auditor General of India,
10, Bahadur Shah
Zafar Marg,
New Delhi-110124.
·
On the top of the envelope containing the documents, the following should be
stated:
“Application for
empanelment as Auditors of Public Sector Undertakings”
·
The documents should be properly tagged and page numbered. This office owns
no responsibility for loss of any documents, which are not properly tagged or
sent subsequently in piecemeal.
·
Only applications complete in all respects will be considered for
empanelment. Incomplete application/documents received after the prescribed
last date will not be entertained. Discrepancy (ies),if any, will not be
intimated.
·
A provisional panel will be available on the website during last week of
April 2015 indicating the position of empanelment of the firm. Representation,
if any, for clerical mistake in the online data only will be accepted upto 5th
May 2015. The representations will be considered on merit on case to case basis.
No representation of any kind will be entertained after 5th May
2015.
·
The CAG reserves the right to call for additional information.
·
The decision of the Office of the CAG of India in this respect will be final.
·
The information submitted by the applicant firms is subject to verification
with the details to be provided by the Institute of Chartered Accountants of
India and any other organization(s) as may be required. If any of the
information so furnished is later found to be not correct or false or there has
been suppression of material information, the firm would stand disqualified
from empanelment/allotment of audit for 3 to 5 years and might also be liable
for disciplinary action under the Chartered Accountants Act, 1949 and the
regulations framed there-under.
·
This office reserves the right to inspect the offices of the Chartered
Accountant firms empanelled with this office to verify the correctness of the
information furnished in the application for empanelment.
·
This office reserves the right to take necessary action in case the firm
refuses to take up the audit assignment without valid reason.
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