NOCLAR Response Checklist — Seven Steps (Sec 360, ICAI Code of Ethics)

The complete Section 360 response working paper: matter identification, the seven-step response checklist, the Sec 143(12) fraud-reporting interface and a documented conclusion — editable in Word.

Free · CORAA original — SA-aligned

Updated 18 Jul 2026

Source

ICAI Code of Ethics — Section 360 (NOCLAR)

Applies to

Audits of listed entities (+ material subsidiaries, 2026 Code)

Core

Seven-step response, documented

Interface

Sec 143(12) / ADT-4 fraud reporting

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NOCLAR Response Checklist — Seven Steps

NOCLAR RESPONSE WORKING PAPER — SECTION 360, ICAI CODE OF ETHICS

Entity: {{client_name}} · Year ended: {{period_end}} · Prepared by: __________ · Reviewed by: __________

Purpose: document the response to identified or suspected non-compliance with laws and regulations (NOCLAR) under Section 360 of the ICAI Code of Ethics. Applicability: audit engagements of listed entities. Under the ICAI modifications, disclosure to an authority that overrides confidentiality is made only where required by law — e.g. Sec 143(12) of the Companies Act 2013.

Part A — The matter

Particulars	Details
Nature of the identified / suspected non-compliance
Law or regulation involved
How the matter came to attention
Period covered and amounts involved (₹)
Management / employees / TCWG involvement, if any
Potential effect on the financial statements

Part B — The seven-step response

Step	What Section 360 requires	Done (Y/N)	WP ref
1 · Obtain an understanding	Nature of the act, the circumstances, and how the law or regulation applies
2 · Discuss with management	Raise with the appropriate level of management and, where appropriate, those charged with governance
3 · Advise timely action	Rectify, remediate or mitigate the consequences; deter future occurrence; disclose to an authority where required by law
4 · Evaluate the response	Assess the appropriateness and timeliness of management’s and TCWG’s response
5 · Determine further action	Consider whether further action is needed in the public interest — including the effect on the auditor’s report and continued association
6 · Disclose where law requires	India modification: disclosure overriding confidentiality only where a law requires it — see the Sec 143(12) interface in Part C
7 · Document	The matter, discussions held, responses received, and the judgments and conclusions reached

Part C — Sec 143(12) Companies Act interface

Where the non-compliance involves fraud by officers or employees of the company, the reporting duty under Sec 143(12) read with Rule 13 of the Companies (Audit and Auditors) Rules 2014 operates alongside NOCLAR:

Fraud involving ₹1 crore or more: report to the Board/Audit Committee seeking their reply within 45 days, then forward the report with their reply to the Central Government in Form ADT-4.
Fraud below ₹1 crore: report to the Audit Committee or Board; the Board discloses it in the Board’s Report.
The Sec 143(12) duty is statutory and cannot be displaced by the Code’s confidentiality provisions.

Part D — Conclusion

Conclusion on the matter (response adequate / further action taken / effect on the auditor’s report / withdrawal considered): ____________________________________________

Prepared by	Reviewed by	Engagement partner

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What’s inside

An excerpt from the template.

NOCLAR RESPONSE WORKING PAPER — SECTION 360, ICAI CODE OF ETHICS

Entity: ___ · Year ended: ___ · Prepared by: __________ · Reviewed by: __________

Part A — The matter

↑ Excerpt only — the full template is what you download as Word

About this template

What you’re downloading, and when to use it.

This template follows the format published by the Institute of Chartered Accountants of India (ICAI) in the AASB Audit Working Paper Templates (June 2023), the authoritative reference for Indian statutory-audit documentation. Fill in your firm’s letterhead and the engagement details on the form above, click Download Word file, and you’ll get a fully formatted .docx ready to use.

Everything is generated in your browser and on a stateless API endpoint — no account, nothing stored on our servers. We’ll ask for a work email once before your first download so we can send you the file and the occasional relevant update; after that, downloads on this device are instant. Edit freely in Word, Google Docs or Pages before sending to your client.

Common questions

FAQs.

What are the seven steps of NOCLAR under the ICAI Code of Ethics?

Obtain an understanding of the matter; discuss it with the appropriate level of management (and TCWG where appropriate); advise timely rectification, remediation or mitigation; evaluate the appropriateness of the response; determine whether further action is needed in the public interest; disclose to an authority where law requires; and document the matter, discussions, judgments and conclusions.

Does NOCLAR apply to every audit in India?

No. ICAI made Sections 260/360 applicable from 1 October 2022 to audit engagements of listed entities, and the Code of Ethics, 2026 extends this to material subsidiaries of listed entities. For other engagements the duties on illegality flow from SA 250 and Sec 143(12), not the NOCLAR response ladder.

Can the auditor disclose NOCLAR to a regulator without client consent?

Under the ICAI modifications, disclosure that overrides confidentiality is made only where a law requires it — the prime example being fraud reporting to the Central Government under Sec 143(12) in Form ADT-4. The IESBA-style voluntary public-interest disclosure was not adopted as a free-standing right in India.

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