ICAI defers peer review requirement for auditors of state-run bank branches by a year, ETCFO
The Institute of Chartered Accountants of India (ICAI) has deferred the so-called “peer review” requirement for auditors of state-run bank branches by a year through December 31, 2026, allowing both auditors and their reviewers more time to prepare themselves for compliance.
In a peer review, an independent auditor usually verifies the audit processes, procedures and documentations followed by the auditor of a firm and issues a report. So, such reviews serve to improve the credibility of auditors and their audit quality.
As per an ICAI announcement dated December 31, the rollout of the fourth phase of the peer review requirement–which also covers audit firms rendering attestation services and having three or more partners–has been deferred from January 1, 2026.
All these audit firms would be required to obtain peer review certificates before accepting any statutory audit once the rules are implemented.
Phase-wise implementation
The apex accounting body had earlier decided to make peer review requirement mandatory for auditors of different categories of companies in phases to ensure its smooth implementations.
In the first phase of implementation, the review was made mandatory for auditors of listed firms from April 2022. This essentially means without the peer review certificate, an auditor won’t be able to conduct audits of listed firms.
The second phase covered auditors of large unlisted firms with paid-up capital of not less than Rs 500 crore, annual turnover of not less than Rs 1,000 crore, or outstanding loans, debentures and deposits of not less than Rs 500 crore. It was implemented from July 2024.
In the third phase, adopted from July 2025, peer review certificates were required for auditors before undertaking statutory audits of entities that have raised funds of more than Rs 50 crore from the public or banks or financial institutions, among others.
The Peer Review Board of the ICAI has issued 3,054 peer review certificates until November 27 in the current council year ending February 11. As of December 5, as many as 8,144 chartered accountant firms have valid peer review certificates.
