The government is likely to relax norms of corporate fraud reporting by auditors, with the ministry of corporate affairs (MCA) considering a proposal to make reporting mandatory only if fraud involves 10 per cent or more of the company's turnover or it is repetitive in nature. Under the Companies Act, 2013, the statutory auditor has to report all frauds to the central government within 60 days of coming to know about it."We are considering new criteria which have an element of materiality for reporting financial frauds by auditors. We are looking at a threshold limit beyond which the auditors will be required to report on fraud to the government," a senior government official said. The government is also considering making fraud reporting mandatory only for companies which have a paidup capital of Rs 1 crore and above, added the official, who did not wish to be named.

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