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ICAI defends action against EY affiliates, cites statutory power. Delhi HC stays order. ICAI directs firms to end tie-ups violating norms. Accusations of bias. Supreme Court involvement.
Delhi High Court issued stay order against ICAI regarding actions on EY affiliate firms. Partners barred, fines imposed, partnerships terminated, retired partners affected. Investigation into Big Four ongoing, violation of Chartered Accountants Act cited, email IDs linkage issue addressed.
The disciplinary committee of ICAI has directed the firms and the individual partner concerned to immediately stop existing arrangements with the multinational entities, as it is circumventing the provisions of the Chartered Accountants Act, 1949.
Declines to comment on recent orders but says body has a very robust disciplinary mechanism
The EY affiliate firm, SRBC & Co LLP spokesperson told ET that they will explore all issues raised in the order and explore options under the law including the appeal process. However, the problem is that the appellate tribunal, which is supposed to hear appeals, has not yet been set up by the institute. "The order focused only on procedural matters, not audit quality, and will not affect the future of the audit firms in any way" said a leading lawyer who works closely with Big Four firms on regulatory matters. Deloitte, KPMG, and PwC did not respond to the ET questionnaire on th...