ICAI Plans New Standards for IT-Driven Audits
The Institute of Chartered Accountants of India (ICAI) is preparing to issue new Information Systems Audit Standards aimed at improving the quality of audits for technology-driven businesses such as startups, fintech companies, and e-commerce platforms.
Announcing the move, ICAI President Charanjot Singh Nanda said the new standards will enable chartered accountants (CAs) to assess IT-related risks—ranging from **cyber security threats and data breaches to system failures—**and recommend effective mitigation measures.
Applicability Across Sectors
While designed with startups and fintech firms in mind, the standards will also apply to financial audits across other industries, reflecting the increasing adoption of digital platforms, ERP systems, and cloud-based technologies.
“With businesses relying heavily on digital ecosystems, traditional financial auditing is no longer sufficient,” said a person familiar with the matter. The new standards will provide a structured approach for evaluating the integrity, confidentiality, and availability of IT systems.
Compliance with Emerging Laws
The initiative also aligns with evolving data protection regulations such as India’s Digital Personal Data Protection (DPDP) Act and the EU’s GDPR.
ICAI aims to equip CAs to guide businesses in meeting their data protection and compliance obligations, while also strengthening financial reporting, fraud prevention, and governance frameworks.
Expanding the Role of CAs
According to ICAI, these norms will empower chartered accountants to deliver value-added services including:
- System audits and IT governance reviews
- Cyber security risk assessments
- ERP implementation audits
- Fraud detection and prevention measures
This move is expected to expand the professional scope of CAs in an increasingly digital economy.
Startup and Fintech Growth Driving Change
India’s booming startup and fintech ecosystem has accelerated the need for robust IT audits.
- The number of recognised startups rose to 1,57,706 by the end of 2024, up from just 502 in 2016.
- The fintech industry is projected to grow from $110 billion in 2024 to nearly $420 billion by 2029.
Last year, the Comptroller and Auditor General (CAG) also urged auditors to continuously upgrade their skills to ensure actionable insights on data privacy, transparency, and information security.
Key Takeaway
With these upcoming Information Systems Audit Standards, ICAI is positioning CAs as key partners in digital risk management and governance, ensuring that financial audits keep pace with India’s rapidly evolving technology ecosystem.
