The Securities and Exchange Board of India (SEBI) has suggested a new rule that requires listed companies to submit a separate report on digital assurance of financial statements. This step aims to improve transparency, enhance disclosure standards, and strengthen investor trust in the financial system.
This proposal follows the “Technical Guide on Digital Assurance” released by the Auditing and Assurance Standards Board (AASB) and the Digital Accounting and Assurance Board (DAAB) of the Institute of Chartered Accountants of India (ICAI). The guide helps auditors use digital audit evidence and technology in their audit work. However, it does not require companies to provide external digital data or reports separately to auditors.
Currently, auditors can use digital information, but companies are not responsible for sharing external data sources with them. SEBI believes that introducing a separate digital assurance report will provide a clearer picture of financial statements and increase trust in listed companies.
To discuss this proposal, SEBI held talks with members of its Primary Market Advisory Committee (PMAC). They focused on how a digital assurance report could align with existing financial reporting rules.
Under Regulation 33 of SEBI’s Listing Regulations, listed companies must follow specific guidelines on financial results, including formats and submission timelines. The new rule could add an extra requirement, making it mandatory to submit a digital assurance report alongside financial statements.
