Introduction

Beyond verifying financial statements, the auditor of a Nidhi Company has a special responsibility under Rule 22 of the Nidhi Rules, 2014. Each year, the auditor must certify whether the company has complied with all provisions of the Nidhi Rules. This certificate acts as an additional safeguard for depositors and regulators.

Annual Certification by Auditor

• Every year, the auditor must furnish a certificate stating that the Nidhi Company has complied with the Nidhi Rules.
• This certificate must be annexed to the audit report, making it a permanent part of the company’s annual filings and disclosures.

Non-Compliance Reporting

If the company has not complied with any provision of the rules, the auditor cannot remain silent. He must:

1. Clearly specify which particular rules were not complied with.
2. Mention them in the certificate attached to the audit report.

This ensures transparency and gives regulators, members, and stakeholders a clear picture of the company’s compliance status.

Importance of Auditor’s Certificate

• Accountability – Auditors are directly responsible for confirming compliance with law.
• Transparency – Members and regulators are informed about non-compliances.
• Depositor Protection – Ensures that public funds handled by Nidhis are subject to additional scrutiny.
• Regulatory Oversight – MCA and ROC can act quickly if non-compliance is highlighted in the auditor’s report.

Conclusion

Rule 22 makes the auditor not just a financial watchdog but also a compliance guardian. By certifying compliance with the Nidhi Rules each year, and reporting non-compliance wherever it exists, auditors strengthen depositor confidence and help maintain discipline in Nidhi operations.