1. Introduction
The National Financial Reporting Authority (NFRA), is committed to strengthen the audit quality and enhance transparency in the financial reporting ecosystem in India. To support this objective, NFRA has mandated the filing of an annual return, “Form NFRA-2” as prescribed under Rule 5 of the NFRA Rules, 2018. This e-form requires auditors of NFRA-governed entities to disclose detailed information regarding their audit assignments, quality control systems, independence measures, and professional conduct.
2. Entities Covered Under NFRA-2 Filing Requirements
The auditor of following class of companies and body corporate is required to file NFRA-2.
(a) Every companies whose securities is listed on any stock exchange in India or outside India.
(b) Companies engaged in specialised activities and special acts, such as insurance companies, banking companies, companies engaged in generation and supply of electricity, company governed by any other special act and company & body corporate incorporated by an Act in accordance with clauses (b) to (f) of sub-section 4 of section 1 of the Companies Act, 2013
(c) Any body corporate or company or person, or any class of bodies corporate or companies in which central government has its own interest.
(d) Foreign incorporated Subsidiary or Associate of any company or body corporate as mentioned above and whose net worth or income exceeds 20% of the consolidated networth or income
(e) Any unlisted public companies whose:
i. Paid up capital is not less than Rs. 500 Cr
ii. Annual Turnover is not less than Rs. 1,000 Cr
iii. Aggregate outstanding loans, debentures and deposits is not less than Rs. 500 Cr
3. Disclosures Required in NFRA-2
The auditor shall disclose the following information under NFRA-2
(a) Auditor’s identification along with contact details.
(b) The name of the auditee client and the audit report issued by the auditor along with the details of fees and other related information.
(c) The details of partners and employee of the auditor.
(d) The details of any disciplinary or any other proceeding initiated against the auditor
(e) Resignations and withdrawal of audit reports
(f) Quality control policies of the auditor along with the consent to co-operate and comply with any information request by NFRA.
4. Filing Deadline
The due date for filing NFRA-2 is 30th November 2025. Under this form the details of audit reports signed off during the reporting period 1st April 2024 to 31st March 2025 will have to be reported. In most cases, these audit reports will relate to audit of financial statements for the year 1stApril 2023 to 31st March 2024.
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