Existing rules do not allow foreign firms to carry out auditing functions in the country. However, these firms have often been accused of indulging in surrogate practices. At present, these companies are allowed to carry out functions such as advisory, consulting and research only.

Most recently, the name of PwC's member-firm PriceWaterhouse came under the scanner for its role in the Rs 10,000-crore Satyam scam which rockedthe corporate world in January last year. The Institute of Chartered Accountants of India-appointed high-powered committee on Satyam has also found that multinational auditing firms have been flouting rules and practising in the country through local affiliates.

Explaining the rationale behind allowing the entry of foreign auditors, Khurshid said, "if they are allowed, we can fix more responsibility on them." However, he added, the interest of domestic firms would be kept in mind while allowing the foreigners to open shops here.

"This is not any more a world in which you can create huge barriers for services or trade; but you have to protect your own territory, your own turf and give your own citizens a level-playing field. Therefore, it is our duty and mandate to ensure that we protect our professionals," Khurshid said.