An expert committee, formed after directions of the Supreme Court, has noted that the “multinational” tag for the Big 4 auditing firms is a misnomer, since these are Indian firms.
The committee, formed during the hearing of a case on alleged FDI violations and malpractices by UK-based audit firm PricewaterhouseCoopers (PwC) and its associated companies, said an impression has been created that the Indian audit firms, which are affiliated with international networks, constitute Multinational Accounting Firms (MAFs).
However, on closer scrutiny, it turned out that these Indian audit firms are set up as partnerships or Limited Liability Partnerships (LLPs) under Indian laws and their partners are members of the Institute of Chartered Accountants of India (ICAI).
“As such, these firms do not contravene provisions of Chartered Accountants Act, 1949, which bar members of the countries not allowing Indians to practice accountancy in their jurisdiction to become chartered accountants in India,” said the committee, headed by Anurag Agarwal, a joint secretary in the Ministry of Corporate Affairs.
The panel said such Indian audit…
