The Minister of Finance has established a Central Scrutiny Centre to examine user filings
The Ministry of Finance and Corporate Affairs virtually introduced the Central Scrutiny Centre (CSC), to review user filings under straight-through processes. The finance minister also unveiled the Investor Education and Protection Fund Authority’s mobile app (IEPFA).
The aim of the CSC initiative is to ensure that data quality is unaffected and error-free. CSC will mainly examine user filings made forward straight-through procedures, identify data quality problems and anomalies, and notify the relevant Registrar of Companies so that corrective action can be taken to restore the data’s validity and correctness, and it can be seamlessly shared with other regulators, if necessary.
The aim of the mobile app is to promote financial literacy by increasing investor understanding, education, and security. Even during the COVID-19 pandemic, the number of companies incorporated in India increased as a result of initiatives such as the implementation of the integrated type SPICe+ & Agile Pro for company incorporation, which offered one-stop solutions to promoters seeking to establish a business entity.
The Central Registration Centre has incorporated approximately 1.38 lakh companies this year, compared to approximately 1.16 lakh companies in the same timeframe last year, a rise of over 17%.
The MCA has mandated that accounting software used by firms have an audit trail
The Ministry of Corporate Affairs has ordered that every company that uses accounting software to keep track of its books of accounts use only software that includes the ability to conduct an audit trail of each and every transaction made after April 1. In addition, businesses are also required to keep an edit record of all changes made to account books, along with dates. Companies must ensure that the audit trail is not disabled, according to the amendments.
These reforms are intended to avoid interference with books of accounts and to increase accuracy in the documentation of accounting entries in order to ensure an accurate and equal view of the books and accounts. Furthermore, additional disclosures in the board report i.e. bankruptcy status and asset valuation will allow stakeholders to make an informed decision about the company’s overall financial health and operations.