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NBFCs still lack quality disclosures, says RBI

Auditors should ensure appropriate qualitative information to depositors: Dy Guv

NBFCs still lack quality disclosures, says RBI
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The central bank is nudging regulated entities to enhance the quality of their disclosures - M Rajeshwar Rao

Mumbai: Reserve Bank of India (RBI) Deputy Governor M Rajeshwar Rao has flagged concerns over quality of disclosures made by some NBFCs and urged the auditing community to ensure that entities provide appropriate qualitative information to depositors as well as other stakeholders.

“The statutory auditors play a significant role in maintaining stakeholder confidence in audited financial statements and this is particularly important in the case of banking industry where the entire edifice is built on ‘trust’ and the biggest external stakeholders, i.e., depositors, are fragmented and unorganised,” he said.

Rao was addressing the Conference of Statutory Auditors and Chief Financial Officers of Commercial Banks and All India Financial Institutions (AIFIs) here on Tuesday. He emphasised that the RBI has a strong interest in promoting sound and high quality accounting and disclosure standards for the banking and financial industry as well as in having transparent and comparable financial statements that strengthen market discipline.

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