SEBI to mandate separate reporting on digital assurance of financial statement

February 3, 2025

Aims to improve transparency, improve disclosure standards and enable better enforcement, and thereby provide greater investor protection and trust in the ecosystem

The Securities and Exchange Board of India (SEBI) has proposed to mandate a separate reporting on digital assurance of financial statement, with an aim to improve transparency, improve disclosure standards and enable better enforcement, and thereby provide greater investor protection and trust in the ecosystem.

This follows a “Technical Guide on Digital Assurance” brought out by the Auditing and Assurance Standards Board (AASB) and Digital Accounting and Assurance Board (DAAB) of The Institute of Chartered Accountants of India (ICAI). This was to provide guidance to its members to adopt enhanced use of technology in audit by implementing the use of digitally available audit evidence and information.

The technical guide focuses on sources of external audit evidence and information available and how the same can be utilised by the members in their audit procedures but does not mandate separate reporting by auditors. No responsibility is cast on the management of listed entities to provide this information obtained from external data repositories to auditors or provide access to such information to auditors.

SEBI held consultations with members of its Primary Market Advisory Committee (PMAC) to deliberate on the requirement of a separate report on digital assurance of financial statements issued by listed companies.

Regulation 33 of the listing regulations specifies requirements with respect to submission of financial results covering requirements on formats of financial results and timelines regarding submission of financial results.

[The Hindu Business Line]