Views on improving the integrity of global capital markets
28 April 2020

E-Signatures for Audit Reports in India Are Allowed — Should Be Required

Posted In: Financial Reporting

CFA Institute not only has supported the use of structured data for financial reporting but also has argued that structuring should extend beyond the financial statements to the management discussion and analysis, earnings releases, and tax reporting — indeed, to all forms of reporting. We argue that all reports in their entirety should be digital (i.e., machine-readable).

In this vein of increasing the digital usability of reports, the Institute of Chartered Accountants of India (ICAI) has announced a policy change permitting the use of electronic signatures to sign audit reports and certificates for the first time. The ICAI has said,

The members of ICAI may use an e-signature for signing audit reports, all reports issued pursuant to any attestation engagement and certificates. However, the members need to ensure compliance with all the requirements relating to signature prescribed in the relevant law or regulation, Standards on Auditing, and relevant announcements/ clarifications issued by ICAI on the matter.

We believe that such electronic signatures should not just be permitted but, indeed, be required. Introducing e-signatures is a useful step toward increasing the digital usability and security of reports. XBRL International notes that to ensure effective security and digital trust of online business reports, further steps can be taken. For example, adopting the legal entity identifier within digital signatures is one way to improve the veracity of a digital report and enhance confidence in its origins.

Image Credit:  © Getty Images/ atakan

About the Author(s)
Mohini Singh, ACA

Mohini Singh was director of financial reporting policy at CFA Institute. She represented membership interests regarding financial reporting and disclosure proposals issued by the FASB, the IASB, and others. Singh holds the Associate Chartered Accountant (ACA) designation.

5 thoughts on “E-Signatures for Audit Reports in India Are Allowed — Should Be Required”

  1. I have no credit card , there is no other option for online transaction ,So that, I have no option.

  2. ASHOK M says:

    Two points I would like to make;

    1. Typo in the article. “The ICAI has said,”

    2. How the auditor signs appear to be more important than what the auditor signs according to the author.

    I am unable to understand the purpose of this article.

  3. Smita Bansal says:

    Thanks for the great update Mohini. Keep us updated the latest news on CA related matters. 🙂

  4. Uttam Pai says:

    Well briefed article! Taking financials digital like in the case of the US and other countries’ company audit reports is surely beneficial. It comes with risks as well, but depending upon the measures taken, the risks cannot outweigh the benefits.

  5. This blog post is really very interesting. as the strategy of writing a blog post is very well explained. Thanks for the valuable, Information.

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