March 25, 2014
In the certificate, auditors will have to state that they have examined the proposed accounting treatment of the scheme between the two entities
Market regulator SEBI today asked all listed companies to follow a standard format for their Auditor Certificates, which are required to be filed to seek approval for merger, demerger and restructuring schemes.
The Securities and Exchange Board of India (SEBI) said it has been observed that the auditors' certificates filed by the companies are generally in different formats and there was no standardisation.
In a circular issued today, SEBI has prescribed a standard format for auditors' certificate which would be followed by the companies.
In the auditor's certificate, auditors would have to state that they have examined the proposed accounting treatment of the scheme between the two entities. This scheme is in compliance with the relevant laws and regulations, including the applicable accounting standards.
"We carried out our examination in accordance with the guidance note on Audit Reports and Certificates for special purposes, issued by the Institute of Chartered Accountants of India," as per the format of auditor certificate.
According to norms, a listed company should file any scheme, proposed to be filed before any Court or Tribunal with the stock exchange for approval, at least a month before it is presented to the Court or Tribunal.