The Hindu : Govt considering Naresh Chandra report

Online edition of India's National Newspaper
Wednesday, Feb 19, 2003

Business

Business

Govt considering Naresh Chandra report

NEW DELHI FEB. 18. The Government is working towards implementation of the Naresh Chandra Committee report on corporate governance issues and some amendments in the Companies Act and the Chartered Accountants Act may have to be made, a senior official said today.

"We are looking at the Naresh Chandra Committee report with a view to implementing it... Some of this may require legislative amendments to the Companies Act and other Acts such as the Chartered Accountants Act,'' the DCA Secretary, V. K. Dhall, said here. The committee, appointed in August last year, was asked to examine various corporate governance issues.

It was entrusted to analyse and recommend changes in areas such as auditor-company replationship, need for rotation of statutory audit firms, procedure of appointment of auditors, determination of audit fees and independence of audit functions.

Efforts to minimise overlap

of SEBI, DCA functions

The Company Affairs Secretary, V. K. Dhall, will soon hold discussions with the Securities and Exchange Board of India Chairman, G. N. Bajpai, on how to harmonise their respective regulatory functions and minimise overlap.

"As many of the Naresh Chandra Committee's suggestions involve both DCA and SEBI, I am personally going to discuss with the SEBI Chairmanm, Mr. Bajpai, how to harmonise our operations over the next few days,'' Mr. Dhall said, addressing a panel discussion on the Naresh Chandra Committee report organised by the Confederation of Indian Industry here.

Even as Mr. Dhall declined to comment further, sources said the Department of Company Affairs was of the view that general overlap between SEBI and DCA should go.

While the DCA regulates companies as per the Companies Act, listed companies are also bound by SEBI guidelines including Clause 49 of the listing agreement and some instances of overlap between the functioning of the two regulators have been noticed.

Late last year, the two regulators appeared to be at loggerheads over search and seizure powers, which till then rested solely with the DCA until an ordinance was issued to provide limited search and seizure powers to SEBI for listed companies.

Speaking on the occasion, Naresh Chandra echoed industry sentiment saying "Clause 49 of the listing agreement of SEBI must be harmonised with DCA's regulatory functions so that this feeling of being over-regulated is dispelled.''

He said many companies felt they were being "surprised'' with requirements of Clause 49 of the listing agreement. — PTI

Printer friendly page
Send this article to Friends by E-Mail

Business