The exclusive authority to issue Standards on Quality Management (SQMs) for auditing lies with the National Financial Reporting Authority (NFRA), according to the Solicitor General of India.

This clarification highlights that the Institute of Chartered Accountants of India (ICAI) does not have the legal power to establish standards related to auditing or quality management, as stated in the ICAI Act of 1949.

This viewpoint has been endorsed by regulatory bodies such as the Comptroller and Auditor General of India (CAG), the Reserve Bank of India (RBI), and the Securities and Exchange Board of India (SEBI).

The NFRA, recognized as the statutory regulator for auditing and accounting, sought guidance from the Solicitor General, who has now communicated this to the ICAI, emphasizing the NFRA's role in setting these crucial standards.