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Introduction - Members/ firms Subject to Review

Peer review will be introduced in three stages with different types of practice units being included in each stage. Implementation will proceed on the basis of random selections from the practice units included in each stage. The Board shall decide the proportion of practice units to be included in the selection during each phase of implementation. Practice units, which shall be covered under each stage, are listed below:

Stage I

Practice Units (selected on random sample basis, from the following):

  1. which are Central Statutory Auditors of Public Sector Banks, Private Sector Banks, Foreign Banks and Public Financial Institutions;

  2. which are Central Statutory Auditors of Central and State Public Sector up capital Undertakings and Central Cooperative Societies based on criteria such as turnover or paid up capital etc. as may be decided by the Board;

  3. which are Central Statutory Auditors of Insurance Companies;

  4. which are conducting audit of Companies having paid up capital of over Rs. Five crores and an annual turnover of more than Rs. Fifty crores and such other criteria as may be decided by the Board;

  5. which are conducting audits or rendering attestation functions for asset management companies and mutual funds schemes.

The implementation of this stage commenced from 1st April 2003.

Notification No: PRB/Notfn./002/02-03, issued on: January 10, 2003

Stage II

Practice units (selected on random sample basis) conducting statutory audit of the following :

  1. Branches of Public Sector Banks;

  2. Branches of Private Sector and Foreign Banks;

  3. Regional Rural Banks/Co-operative Banks;

  4. Non-Banking Financial Companies (NBFCs), based on such criteria as the Board may decide;

  5. Companies having paid-up capital of Rs. Five crores or less and such other criteria such as turnover etc. as may be decided by the Board;

  6. Concerns which have raised funds from the public/Financial Institutions of over Rs. One crore at any time during the period covered by the review and satisfy such other criteria in these regards as the Board may decide, as well as concerns who have shown readiness to raise funds of the above amount or more as evidenced by their filing of prospectus.

The implementation of this stage commenced from 1st April 2004.

Notification No: - PRB/Notfn./005 /04-05, dated : 23rd July, 2004

Stage III

All other practice units selected on random sample basis.

The implementation of this stage commenced from 1st April 2005.

Provided that if a practice unit is not selected in any of the above three stages, it may suo moto apply to the Board for the conduct of its peer review, and the Board shall take due cognizance of such request.

Provided further that if an auditee concern requests the Board for the conduct of peer review of its auditor (practice unit), the Board shall take due cognizance of such request and in that case the cost of the peer review shall be borne by such auditee concern.

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