| Dear Friends, |
It’s 6.18 in the morning. After getting back from a small walk, I had my first
tea that is usually minus sugar and milk. My newspapers have been
delivered. As I start reading some of them, I realise: Few more days and
June will be over. July is ready to dawn in.
July as a month has a lot of associations for all stakeholders of accountancy
profession. Our alma mater had been established by an act of the Parliament
on July 1, 1949. We celebrate because the coveted accountancy profession
was institutionalised in July. This could take place only because strong
efforts were put in by our forefathers on every front of our dear profession.
Our profession was accepted by the Govt. of India. Imagine, our Institute
was set up even before our country had its constitution in place. Since the
introduction of the Companies Bill in 1913, we have been struggling very
hard and putting in voluminous efforts in order to streamline the
intricacies in accountancy profession, levelling disparities at various levels.
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Very few of us today know that, till 1949, technically speaking, there
were actually very few chartered accountants. There were various
designations in profession-RAs (Registered Accountants), Approved
Accountants, Incorporated Accountants, GDA (Government Diploma in
Accountancy)-besides the existence of Chartered Accountants who had
their education from one of the five chartered societies from UK, e.g. The
Institute of Chartered Accountants of England and Wales and The
Institute of Chartered Accountants of Ireland. To remove this distinction
from the professional makeup of our forefathers, a group of accountants
started a war for dignity, since not just Chartered Accountant designates but
the industry too thought very high and superior of the chartered
designation. That too, when skill-wise, accountants trained and educated in
India were no less competent than their UK counterparts. It was the
joint efforts of our accounting forefathers and extensive discussions and
debates put up by the Government of India officials, enthusiast public
advocates, thoughtful political leaders and representatives, etc., in the
Legislative Assembly on March 23, 1936, with which our forefathers
started their struggle for equality in professional standing. Then in
the 18th meeting of the Indian Accountancy Board, it was decided to
designate all accountants of India as chartered accountants. Since
then, The Institute of Chartered Accountants of India took over the
responsibility to train that class of noble professionals.
This is the time to recall the great endeavours of our accounting
forefathers and pay our sincere tribute to them. The month of July gives
all of us a reason to recall their contributions. Friends! Let us not forget
that we have a solid heritage as gifted by our strong and competent
accountancy professionals. Let us continue the tradition and keep on adding
glory to that heritage.
Now let me apprise you on some of the major developments in the
last one month concerning the accountancy profession:
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| Importance of SA 700 (Revised) |
I wish to record my appreciations for the members, including auditors of
companies, auditors of banks and its branches and auditors of insurance
companies, for complying with the requirements of the SA 700 (Revised),
Forming An Opinion And Reporting On The Financial Statements for the
audit reports for FY 2012-13 and onwards. I also wish to place on record my
appreciations for the regulators and the industry, who have whole-heartedly
supported the change to this new auditor's reporting format. At this juncture,
Compliance with the Standards on Auditing issued by ICAI, being mandatory in
application, ensures a high-quality audit. In particular, the SA 700 (Revised) is
aimed at reducing the expectation gap among the readers to the responsibilities
of the management vis-à-vis the auditors. For the benefit of the readers, the
Standard not only requires that headings be given to the various sections
in the auditor’s report, it also requires separate presentation of auditor’s
opinion on the financial statements vis-à-vis auditor’s opinion on other
legal or regulatory reporting requirements so that both are clearly
distinguishable. Since the SA 700 (Revised) is in effect now, I urge all the
members signing audit reports to ensure compliance with the Standards.
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| MoU for Women Chartered Accountants |
We have recently entered into an MoU with the “Avinashilingam Institute
for Home Science and Higher Education for Women”, Coimbatore, i.e., a
deemed university for women, to facilitate our women chartered accountants
having three-year experience to pursue PhD programme as both full-time
and part-time candidates. Vice-Chancellor of the Institute Dr. Sheela
Ramachandran was at ICAI in New Delhi to sign the MoU. Our past-President
CA. T. S. Vishwanath was also present. This brings the tally of the institutes
to 100 (93 Universities, 6 IIMs and IIT Madras), which have recognised
chartered accountants as eligible for pursuing the PhD programme. The
CA qualification has been treated as equivalent to postgraduate degree in
commerce or allied disciplines.
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| Contributions to CABF |
From the office of accountancy profession, it is quite satisfying to acknowledge
before our stakeholders that, during February- May 2013, we have received  60,
11,996 as contribution in the Chartered Accountants Benevolent Fund (CABF),
out of which 11,56,996 was received as voluntary contribution. We have
already extended a sum of 50,76,500 as financial assistance to the families
of deceased members of the Institute during this period. It is essential that
our CABF continues to receive funds in order to extend help and assistance to
our members in crisis. I would request all our members to make generous
contributions and also encourage other members to donate to the fund.
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| Inappropriate Response to Tenders |
It has been observed that some members quote abnormally low fee while
responding to tenders, which gives birth to a suspicion over the seriousness
and quality of their delivery. We had decided in 2010 that if there is a huge
(abnormal) difference between the lowest quote received against a tender
(on which the tender is ultimately allotted) and the next lowest quote,
then peer review of the said assignment and/ or concerned chartered
accountants/CA firm thereof can be ordered. The Council later had decided
in December 2010 that a cost-sheet be maintained by members of the
Institute responding to tenders and accepting professional work, incorporating
the details of cost, personnel, hours, etc., which the Institute may call for
and refer to for various purposes. I will urge our members to keep these
decisions in mind while responding to a tender.
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| Rising Membership and Student Strength |
I am glad to inform you that the total membership strength has gone up
to 2,18,233 as on May 22, 2013, from 1,92,513 as on April 1, 2012.
There is an addition of 25,720 new members showing a phenomenal
growth in membership strength by 13.36%. Further, it is again a credit
to our profession that an incredibly large number of students, i.e., 11,11,267,
have registered with us, out of which we have about 6,09,150 under CPT,
about 3,08,400 under IPCC, about 24,130 under Intermediate (IPC) Direct
Entry Scheme, and about 1,69, 600 in final.
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| Five New Branches in CIRC, NIRC and WIRC |
I am happy to acknowledge before our stakeholders that we have notified
the setting up of Sikar Branch of CIRC in Sikar District of Rajasthan
(with jurisdiction as Sikar, Khandela, Losal, Palsana and Ringas), Sirsa
Branch of the NIRC in Sirsa District (with jurisdictions as Sirsa, Ellenabad
and Kalanwali), Rewari Branch of NIRC in Rewari District of Haryana,
Nanded Branch of WIRC in Nanded District of Maharashtra, and Dhule
Branch of WIRC in Dhule District of Maharashtra (with jurisdictions as
Dhule and Dondaicha). With the increased reach, members of these
places would find increased reach beneficial to them. With this addition the
total number of branches is now 138.
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| e-Sahaayataa |
As all our stakeholders know, we had introduced an online grievance
management system of the Institute, e-Sahaayataa, to address the queries,
complaints and grievances of our stakeholders pertaining to the day to
day working of the Institute. Grievances are being expeditiously catered to
and are being resolved. I am really happy to see the overwhelming response
and appreciation of this system by one and all. We receive queries,
complaints and grievances, and resolve them within the stipulated
time-frame. However, credit for the success of this system goes to the
cooperation of our stakeholders. The system has become all the more
refined and evolved over the time. We look forward to your continued support
and to serve you better. I call upon all the members to use e-Sahaayataa for
their queries.
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| Industrial Training for Articled Assistants |
Articled assistants who pass Intermediate (Integrated Professional
Competence) Examination/Intermediate (Professional Competence)
Examination/Professional Education (Examination-II)/Intermediate
Examination may serve as an industrial trainee in any of the financial,
commercial or industrial undertakings, as approved by the Institute, under
an eligible member of the ICAI working in that organisation. I would request
all members to encourage their final-year articled assistants, who
have passed Intermediate (IPC) Examination in entirety, to pursue industrial
training for 9-12 months. Other details including application form and the
list of organisations permitted to impart industrial training are available on
the Institute’s website. Concerned regional offices of the Institute may also be
contacted in this regard.
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| More Branches to Hold GMCS/ Orientation Programmes |
We have extended permission and approval to 11 new branches against their
request to organise Orientation Programmes and/ or GMCS Course. We
have approved Alleppey, Hubli, Sivakasi and Pondicherry Branches for GMCS
from Southern Region; Aligarh, Meerut and Ratlam for GMCS, and Bhavnagar
for Orientation Programme and GMCS from Central Region; and Karnal, Sangrur
and Panipat for GMCS from the Northern Region. Members should inform the
articled trainees/students about the new centres and encourage them to
undergo the respective courses at the earliest.
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| Examinations |
May 2013 examinations have been fairly conducted across all centres except
for an untoward event where we have initiated the disciplinary process against
the persons responsible. Fair examinations strengthen the essence
that accountancy profession communicates to our society and nation at large.
We represent our alma mater in everything we do as members of ICAI. It
becomes mandatory for us to act sincerely and responsibly while carrying out
all our professional work.
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| ***************** |
We all like early monsoon which brings relief to the earth from the heat of
summer. But this time, it has brought along a serious crisis to the people in
some regions of our nation. As a result of torrential rains and a series
of flash floods, landslides and cloudbursts, thousands of people, including
locals and tourists, are stranded, thousands are missing, and several villages
have been washed away. The extent of human loss is beyond estimate. It is a
trying time for all of us. At the least, I request my professional colleagues to
contribute generously for this cause. Either individually or in group, we will
find out a way to help those affected by the natural calamity.
Celebrated coach Celestine Chua quite responsibly remarks: The degree of
responsibility you take for your life determines how much change you can
create in it. He goes on to say: The more you take responsibility for your past
and present, the more you are able to create the future you seek. Besides
what the nature has done, if we contemplate on the reasons, we will
find that this is also because of ecological instability that we have caused
through severe forest depletion and unplanned housing projects. The
C&AG had warned of the ecological hazard in these sensitive regions.
Growth at the cost of the existing resources
is never advisable.
There are things of our concerns and there are not. But being members of the
same nation, we have to own up certain responsibilities that are beyond our
purview at times. Martin Luther King rightly advises: You are not only
responsible for what you say, but also for what you do not say.
While we have professional responsibilities of our own, we will have to share
the national responsibilities. Let us be responsible to our time and our society.
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Best wishesCA. Subodh Kumar Agrawal
President, ICAI
New Delhi, June 24, 2013
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