JKPSC Prelims 2021
General Studies (Paper 1)
Answer & Explanation
Click "Check Answer" to reveal
Correct Answer:
Option C —
Examine corporate governance issues
The Naresh Chandra Committee was appointed by the Ministry of Finance and Company Affairs in 2002 in the wake of major corporate scandals globally (like Enron and WorldCom) and in India. Its primary objective was to strengthen the framework of corporate governance to protect investors and ensure transparency.Key Recommendations of the Naresh Chandra Committee
The committee's report is a landmark in Indian corporate history. Some of its most significant recommendations included:
Independent Directors: It defined the role and criteria for "Independent Directors" to ensure they are not influenced by the company's management. It suggested that at least 50% of the board should consist of independent directors.
Audit Partner Rotation: To prevent an overly cozy relationship between a company and its auditors, the committee recommended the rotation of audit partners every few years.
Prohibition of Non-Audit Services: It recommended that statutory auditors should not provide certain non-audit services (like bookkeeping or internal audit) to the same client to avoid conflicts of interest.
CEO/CFO Certification: It proposed that the CEO and CFO should personally certify the accuracy of financial statements, increasing individual accountability at the top level.
Comparison with other options:
Age Limit for Exams: This is usually handled by committees like the Baswan Committee (2016) or the Alagh Committee (2001) in the context of the UPSC.
Reservation Issues: Significant committees include the Mandal Commission or the Santhanam Committee (though the latter focused more on corruption).
Domestic Violence: Issues related to women's safety and laws are often associated with the Justice Verma Committee (2013).
Revision Tip:
In many exams, the Naresh Chandra Committee is specifically linked to the Audit-Auditor relationship. If you see a question about "Auditor Independence," this committee is almost certainly the answer.
Answer verified by Quintessence Classes faculty — Karan Nagar, Srinagar.
Try another question from JKPSC JKAS 2021 Prelims
Try another question from General Studies (Paper 1)
More General Studies (Paper 1) questions
From across UPSC, JKPSC, and JKSSB papers — same subject, different years.
Shirur Mutt case judgement of 1954, which was recently in news, is related to:
Minto-Morley reforms of 1909 proposed
Which of the following states of India share an international border with Myanmar?i. Tripura
ii. Mizoram
iii. Manipur
iv. Nagaland
Select...
What field of Science is the Bragg's law related to?
Consider the following statements regarding silk production in India:A) Almost all popular commercial varieties of silk are produced in I...