India audit watchdog to complete probe of Gensol, IndusInd Bank within six months, official says

NEW DELHI: The Financial Reporting Review Board (FRRB) will complete its probe into audit reports of Gensol Engineering and IndusInd Bank within six months, the president of the country’s audit watchdog said Monday.

“The FRRB will scrutinise all audit documentation to determine if any issues exist and will submit its report within six months,” said Charanjot Singh Nanda, President of the Institute of Chartered Accountants of India (ICAI).

Gensol Engineering is facing regulatory action amid concerns that it may have diverted business funds raised for personal purchases.

India’s markets regulator in April barred Gensol Engineering’s founders from the securities markets, alleging that they routed company funds to related parties and used them for unrelated expenses, treating the company’s funds as a “promoters’ piggybank.”

Promoters in Indian markets are large shareholders who can influence company decisions.

IndusInd Bank CEO quits as accounting lapse triggers management shakeup

If the review finds audit reports fail to present a true and fair view, the FRRB may refer the matter to ICAI’s disciplinary committee for appropriate action against auditors, Nanda told reporters in New Delhi.

Separately, IndusInd Bank disclosed in March that years of incorrect accounting of internal derivative trades led to a $230 million hit to its accounts for the financial year ended March 31.

An internal audit of its microfinance business found about $80 million was incorrectly recorded as interest across three quarters, which it reversed in January.