Topic – Statutory, regulatory and quasi-judicial bodies
3) Explain the role of SFIO? Examine what role it can play in averting crises such as one at IL&FS?(250 words)
Why this question
The article discusses about the issues with auditing practices at IL&FS and why it is necessary for the SFIO to look into the matter. UPSC in the past has focussed on the role of such bodies and this article provides some interesting insights into the problems associated with IL&FS and role of SFIO.
Key demand of the question
The question expects us to discuss the role of SFIO in detail. Thereafter, it expects us to explain the problem with auditing at IL&FS and how SFIO can play a role in ensuring that such issues are not repeated again. Finally, we need to provide a way forward.
Examine – When you are asked to examine, you have to probe deeper into the topic, get into details, and find out the causes or implications if any .
Structure of the answer
Introduction – Explain about the IL&FS crisis.
- Explain that the government has told the National Company Law Tribunal (NCLT) that it plans to reopen the accounts of IL&FS since it suspects large auditor lapses, to be conducted by SFIO
- Explain the role of SFIO
- The SFIO is a fraud investigating agency in India, under the jurisdiction of the Ministry of Corporate Affairs.
- The SFIO is involved in major fraud probes and is the coordinating agency with the Income Tax Department and the Central Bureau of Investigation
- Discuss the issue in IL&FS regarding auditing which the SFIO has to investigate and highlight what would be the impact of these investigations.
Conclusion – Give your view on the role of SFIO and discuss way forward.