SEBI has issued a circular on 29th March, 2019 inserting a new-sub regulation 8, to existing Regulation 33 of SEBI Listing Obligations and Disclosure Requirements Regulations, 2015 mandating that, the Statutory auditor of a listed entity shall undertake a limited review of the audit of all the entities/ companies whose accounts are to be consolidated with the listed entity as per AS 21.
The Circular also lays down the guidelines to be followed by a Statutory Auditor to conduct the limited review. In addition, formats for limited review/audit report of the listed entity to be issued for Standalone and Consolidated results both on a Quarterly and Annual basis has been provided by SEBI in its circular. This requirement will take effect from April 01, 2019.
What does this mean for a listed entity and Statutory Auditors of the listed entity:
- Listed entities shall obtained limited review reports from its Statutory Auditor on Standalone and Consolidated Financial Statements in the revised formats issued by SEBI
- The statutory auditors undertaking the audit/ review of the Consolidated Financial Statements/ Results of the Parent Company shall obtain the required information from the Independent Auditor of the respective companies.
- The audit and limited review of the respective group companies that are being consolidated with the Parent Company shall continue to be undertaken by the respective auditors of such Companies.
- The new requirement shall be in addition to and not affect the norms and procedures with respect to limited review specified in other clauses of Regulation 33.
Click here for the circular.
