REGULATORY BODIES IN INDIA

REGULATORY BODIES IN INDIA

• The Ministry of Corporate Affairs (MCA): MCA is an Indian Govt. Ministry. The Ministry is primarily

concerned with administration of the Companies Act 2013, the Companies Act 1956, the Limited Liability

Partnership Act, 2008 & other allied Acts and rules & regulations framed there-under mainly

for regulating the functioning of the corporate sector in accordance with law. It is responsible mainly for

regulation of Indian enterprises in Industrial and Services sector.

Presently, they are entrusted with the development of India ASs. The Ind AS are named and numbered

in the same way as the corresponding International Financial Reporting Standards (IFRS). MCA has to

spell out the accounting standards applicable for companies in India. As on date MCA has notified 39 Ind

AS. This shall be applied to the companies of financial year 2015-16 voluntarily and from 2016-17 on a

mandatory basis.

• The Institute of Chartered Accountants of India (ICAI): ICAI is the national professional accounting

body of India. It was enacted by the Parliament to regulate the profession of Chartered Accountancy in

India. It recommends the accounting standards to be followed by companies in India to The National

Financial Reporting Authority (NFRA) and sets the accounting standards to be followed by other types of

organisations. ICAI is solely responsible for setting the auditing and assurance standards to be followed

in the audit of financial statements in India. It also issues other technical standards like Standards on

Internal Audit (SIA), Corporate Affairs Standards (CAS) etc. to be followed by practicing Chartered

Accountants. It works closely with the Government of India, Reserve Bank of India and the Securities and

Exchange Board of India in formulating and enforcing such standards.

• SEBI: Securities Exchange Board of India (SEBI) was set up in 1988 to regulate the functions of

securities market. SEBI promotes orderly and healthy development in the stock market but initially SEBI

was not able to exercise complete control over the stock market transactions. It was left as a watch dog

to observe the activities but was found ineffective in regulating and controlling them. As a result, in May

1992, SEBI was granted legal status. SEBI is a body corporate having a separate legal existence and

perpetual succession. The SEBI has been entrusted with both the regulatory and developmental

functions. The SEBI plays a pivotal role in the capital market. They protect the investors so that there is a

steady flow of savings into the Capital Market. They ensure the fair practices by the issuers of securities,

namely, companies so that they can raise resources at least cost. They help in the promotion of efficient

services by brokers, merchant bankers and other intermediaries so that they become competitive and

professional. It has initiated the basis for control and regulation of the market, arranged for the licensing

of merchant banks, mutual funds etc. and performed the advisory functions to the Govt. The legislation

giving powers to SEBI in the form of the Securities & Exchange Board of India Act to protect the interests

of investors in securities and to promote the development of and to regulate the securities market and

for matters connected therewith or incidental thereto.