The Common Proficiency Test (CPT) is an entry level test meant for 10+2 students to the Chartered Accountancy Profession having multiple choice objective questions. The level of knowledge expected is basic knowledge with the objective to develop conceptual understanding of the subject concerned.

With a view to augment the Question Bank in the Subjects of Accounting/Mercantile Laws/General Economics/Quantitative Aptitude of Common Proficiency Test, it has been decided to invite questions from Chartered Accountants/Subject experts working in various Colleges/Universities/Public/Students pursuing Chartered Accountancy Course etc.

The contributor can contribute as many questions as he/she can, but in a lot of minimum of 20 questions in the subjects of Accounting/Mercantile Laws/General Economics/Quantitative Aptitude in the following manner:-

The questions should be of objective with four probable answers for each question. The correct answer for each question is also required to be given.

Fill in the blanks having four alternative answers.

Small paragraph containing two to three lines followed by a question having four alternative answers.

Numerical having four alternative answers (in Fundamentals of Accounting, Mathematics and Statistics).

Simply worded Case studies involving multiple concepts be also prepared. The case study could be something like a practical situation described in 3-4 lines in simple language with application of single/multiple concepts and requiring students to choose one answer from amongst four answers whereby the analytical/logical ability and intelligence of the students is tested.
 
Since the CPT is an entry level Test meant for 10+2 students, the level of knowledge expected is basic knowledge and the questions should be aimed at testing the conceptual understanding and fundamentals of the subject than merely testing the memory of candidates. The difficulty level of the questions should be of 10+2 level and capable of being answered/solved in less than one minute.

While framing the questions, the questions be framed in such a manner that each one of the four answers given for a particular question, per se, appear to be the right answer thereby requiring the candidate to use his analytical ability to find the correct answer.

The language of the questions to be sent should be English only and is clear, correct, unambiguous and free from any doubt. The language conveys the same meaning as was intended by you.

The copyrights of the questions so submitted shall vest with the Council of the Institute. The contributor of the questions shall ensure that the questions so submitted to the Institute are not parted with by him/her to any other Body/Person and shall be meant only for the exclusive use by the Council of the Institute.

It may please be noted that the questions framed by you should be original and not already published in some books or journals or study material of the Institute or reference/text books available in the market or also from question papers of any other examinations or material distributed by any coaching institution. The requirement is the questions that are original and framed with the meticulous care and genuinely.

For each question framed and forwarded and accepted by the Council of the Institute for augmentation of the Question Bank of CPT, Rs.100/- per question selected/accepted will be paid as honorarium. In addition to honorarium payable towards questions selected, Rs.100/- (fixed) will be paid for other services also. The questions may be sent in a sealed envelope superscribed “Question Bank – CPT” to Dr.T.Paramasivan,Sr.Deputy Director(Exams),The Institute of Chartered Accountants of India, Indraprastha Marg, New Delhi – 110002 by name or by e-mail to tparamasivan@icai.in While sending the questions by post/mail, please mention your name and complete postal address alongwith contact details including mobile number. All correspondence on the subject should be treated as secret. 

Interested persons may kindly contribute to the Question Bank of CPT.

(Dr. T. PARMASIVAN)
SR.DEPUTY DIRECTOR (EXAMS.)

“India stands at a crucial stage. All across the globe there is interest in India as an emerging global power… We have to be able to compete with the finest minds in the world. In this, education occupies a crucial position,” so said Hon’ble President of India Smt. Pratibha Devisingh Patil recently. I am delighted to inform you that we had the honour to meet this visionary and inspiring first woman President of the country at the Rashtrapati Bhawan recently. During the meeting, the undersigned, along with Vice President CA. G Ramaswamy, Council Member CA. S.B. Zaware and a member from Pune CA. M.S. Jadhav updated her about our Institute and our contribution as an important partner in Nation Building. We also requested her to be the Chief Guest at the mega high-profile International Conference being organised by us on 4-6 January 2011, details of which have been published elsewhere in the journal. Her Excellency Smt. Patil showed keen interest in the activities and role of the Institute in the growth and development of national economy in particular and society in general. We fervently hope that she will kindly give her consent to grace our International Conference.
 
Meanwhile, as readers will recall, we basked in the glory of Commonwealth Games 2010 by winning a record number of medals. We got medals in events we were not hopeful at all. We did not mind being at second position, but we rejoiced performing better than England. Reasons for celebrations were many. There is a remarkable trend emerging slowly but distinctly, which is very keen on engulfing all spheres of human existence: our female sportspersons have performed unexpectedly better in many events of the Commonwealth Games. Ironically, Haryana having the lowest sex ratio probably has the largest share of medals earned by female sportspersons. We personally have observed that, of late, female students have been performing better in CA examinations too. In fact, they have been doing better in all other fields of education. Anyway heroes, philosophers, or great men can exist, if we have intelligent and educated women in society.

It is time to learn a lesson, as it is never too late to do so: women deserve equal treatment and respect from our society. Initially, we may have to start with some adjustment in order to accommodate them with equality. Let us take a pledge to respect them in our family, first, as we know: charity begins at home. This will bring a sea change in not just the form and composition of our society but also in the quality of our own existence. To quote our adorable President of India Hon’ble Pratibha Devisingh Patil: “Empowerment of women is particularly important to me as I believe this leads to the empowerment of the nation”. American lawyer and political activist Bella Abzug rightly observed: Women are changing the stream, making it clean and green, and safe for all. There is a definitive connection between women’s rights and development, and socio-economic development and peace of a state.

Now let you be updated on some important developments over the last month.

MCA Delegation to Moscow

ICAI Vice-President CA. G. Ramaswamy with the Director, Board of Studies, Shri Vijay Kapur was in Moscow recently as part of the MCA delegation led by the MCA Secretary Shri R. Bandyopadhyay. Other members of the Indian delegation were ICWAI President Shri B. M. Sharma and ICWAI Central Council member Shri A. N. Raman. Agenda of the delegation was to interact with the government functionaries and accounting professionals in Moscow. The Institute of Professional Accountants of Russia (IPAR) showed keen interest in our activities. On the initiatives of our Vice-President, the IPAR responded positively by coming forward with a proposal for mutual areas of cooperation regarding implementing IFRS, auditing and quality control standards, and internal audit standards, etc. We have invited the IPAR President Mr. Vyacheslav V. Skobara and Chair of the IPAR International Affairs Ms. Svetlana M. Bychkova to attend our International Conference to be held in January 2011. The delegation also met Mr. Sergey D. Shabalov, State Secretary, Deputy Finance Minister of Russian Federation.

Roundtable Conference on Commerce and Accountancy Education in India

We recently organised ICAI’s first ever Roundtable Conference on Commerce and Accountancy Education System in India in New Delhi to exchange thoughts on various areas of academic and practical interest in the field of commerce and accountancy education in India. It was inaugurated by Shri Jitesh Khosla, Additional Secretary and Officer on Special Duty, Indian Institute of Corporate Affairs, who was keen on us leading in enhancing the financial literacy and the basic knowledge of the accountancy amongst the people of India. Eight Vice-Chancellors, namely Prof. Manoj K. Mishra of University of Lucknow, Prof. K. K. Deka of Dibrugarh University, Prof. A. D. Sawant of University of Rajasthan, Prof. Binayak Rath of Utkal University, Prof. R. Venkata Rao of National Law School, Bangalore, Prof. I. V. Trivedi of Mohanlal Sukhadia University, and Prof. J. L. Gupta (former Vice-Chancellor) of Bilaspur University, attended the Conference. More than 55 Heads, Deans of Commerce and Management Department, and faculty members representing various management institutions and universities of India also participated. The undersigned also participated in the Conference with Central Council colleagues CA. Vinod Jain, Chairman, Board of Studies, CA. Jaydeep N. Shah, CA. Bhavna Doshi, CA. Rajkumar S. Adukia and CA. S. B. Zaware. Presentations were made by Prof. Ashish Bhattacharyya from IIM, Kolkata, Dr. Avinash Chander, Technical Director of ICAI and Shri Vijay Kapur, Director, Board of Studies of ICAI.

We wish to inform that the discussions held provided a good platform for exchange of views amongst the leading accounting educators of India. Quite rightfully, everybody requested us to bring out uniform reading material on Indian Accounting Standards converged with IFRS in a simplified and illustrative manner for university students. They also desired that the Institute could frame model course curriculum meant for the Indian universities. Representatives of some universities even offered us the space for building up reference libraries and classrooms for imparting education through e-learning mode. During the discussions, the participants also stressed the need to bring transparency and accountability in examination system. We are very confident that a synergy between the Institute and the universities can produce better results.

ICAI Offers Support to Shri Nandan Nilekani for UID Project

During the meeting recently held with Shri Nandan Nilekani, Chairman of the Unique Identification Authority of India (UIDAI), the undersigned, on behalf of the Institute, extended a promise of complete support to the ambitious UID project of our country with all possible resources of the Institute. We suggested to him that ICAI can play important role in development and implementation of this project, while actively working with the Government. We showed our willingness to offer the manpower of vast base of ICAI members located across the country to be used in the implementation of the project, which will result in the issuance of Unique IDs to all citizens of India. We also informed Shri Nilekani that our members having experience in endeavours such as PAN card, e-governance and facilitation centres for sales tax and excise could be well-suited to be a part of this project. During the meeting, we also discussed the use of IT system in Goods and Service Tax among other issues of our mutual interest. Mr. Nilekani promised to utilise the services of Chartered Accountants in the GST project.

ICAI Briefs Media on IFRS Convergence

We would like to remind our members that we are committed to meet our deadline of the convergence of the Indian Accounting Standards with the International Financial Reporting Standards (IFRSs) effective April, 2011 in select entities as per the roadmap laid down by the Government. Let us also recall that, to spread awareness and popularise the convergence of our accounting standards with the IFRSs, we have launched a nationwide campaign. As part of this very initiative, we recently organised an interactive session with the representatives of Indian media, basically to brief them on the IFRSs-related developments and convergence, and to help them print objective and authentic information in this regard in the media. This whole exercise was aimed at encouraging and helping the media in supporting our efforts to spread mass awareness about IFRSs and to highlight the comprehensive benefits that convergence is going to provide to society in general and our economy in particular.

Draft of ASLB on Presentation of Financial Statements Ready

In the direction of establishing a single set of high quality financial reporting standards for Local Bodies further, the Committee on Accounting Standards for Local Bodies (CASLB) has recently finalised the draft of ASLB on ‘Presentation of Financial Statements’ to prescribe the manner in which general purpose financial statements should be presented. This would help the Local Bodies immensely in presenting their financial statements in a comparable and consistent manner. Also, drafts of Standards on ‘Inventories’ and ‘Segment Reporting’ will soon be finalised.

New Group to Respond to Parliamentary Standing Committee

A Special Group was constituted for formulating ICAI’s views/response to the various recommendations made by the Parliamentary Standing Committee on Finance on Companies Bill 2009. The Group has met and deliberated on the Report in detail. The views/ suggestions as formulated are getting finalised for sending our response.

ICAI Probe into Auditing/ Accounting Violations in IPL

We are planning to send notices to six IPL franchisees seeking more information from the companies owning the teams. These franchisees are – Kings XI Punjab, Delhi Daredevils, Rajasthan Royals, Chennai Super Kings and Deccan Chargers. The investigations into alleged violations of auditing and accounting norms by the auditors are not yet complete due to the non-availability of the required information in these companies. This investigation is part of a multi-agency probe launched by the Government of India, e.g. I-T Department is probing tax evasion, ED money laundering, MCA sources of funding and shareholders’ patterns, etc. Surprisingly, there is no published financial information with Kolkata Knight Riders and Royal Challengers.

Project Parivartan

Project Parivartan, a journey embarked on to bring about a paradigm shift in the working of our Institute and conceived with an idea of taking the Institute to a qualitatively new way of working, aims to create a single tightly-integrated system for catering to the entire community of chartered accountants and students, irrespective of their geographical locations, through the Internet. It also aims to create a truly next-generation Institute through IT-revolution. The journey so far in this direction has been quite successful and the Project is at the execution of next level of IT maturity. The ground covered so far includes the EoI for infrastructure and software applications, to onboard our IT partners. We have witnessed good traction and interest from major players in the market. The Project Management Office is working on closely with all other departments to complete our requirements for the tenders that we plan to float towards the end of this month. Despite the tedious process, we assure everybody that our institute is committed to transformation. We will keep you updated of the progress as we make from time to time.

CBDT Takes Positive Action Following ICAI Representaion

As you will be aware, an amendment to Rule 12 of the Income-tax Rules, 1962 vide notification no. 49 dated 9th July, 2010 made it mandatory for all Companies (including foreign companies) filing ITR-6 to digitally sign the Income-tax return for the AY 2010-11. Thereafter, certain procedural changes were effected. The Institute was given to understand that as per the changed requirements made applicable w.e.f. 1.08.2010, where the signatory to the return is not the same as the signatory in the immediately preceding year, the system required that the DSC also contains the PAN encryption therein. The said revised procedure was creating practical difficulties in case of Foreign Companies whose directors being non-residents were not required to obtain a Permanent Account Number in India due to which a PAN encrypted DSC could not be immediately available. Hence, a representation posing the difficulty being faced by Foreign Companies was made by the Institute to the Central Board of Direct Taxes. In view of the same the Central Board of Direct Taxes has relaxed the requirement of using encrypted PAN on DSC for non-resident signatories of Foreign Companies. Accordingly, the signatory may register with a non-PAN DSC from CCA, India and use the same jurisdiction while uploading the return. This facility is available only for all foreign Companies under the jurisdiction of respective International Taxation wards or circles of Income Tax Department.

ICAI Wants Power to Act Against Erring Firms

It is quite affirmative now for the Institute to be ready for seeking power from the law to take action against erring CA firms. In this light, as per the Act, the Institute can take disciplinary action against its members but not against the firms. At the same time, it is becoming extremely important to curb the wrongful and illegal acts committed by the firms. So, for the first time, the ICAI has decided to recommend to the Government of India that power to act against an erring firms be given to the Institute after necessary amendments in the Act. Action against the firms are proposed to be initiated in rarest of rare circumstances and in the cases in which there are continuous and repetitive acts of negligence, jeopardising of public interest or proved collusion in perpetration of fraud. Generally the action is contemplated only against individual members. We definitely need more powers to ensure that big corporate scandals do not occur in future.

International Competition Law Conference

The Institute played a crucial role as Knowledge Partner for a highprofile International Competition Law Conference organised by Competition Law Bar Association in national capital recently. Corporate Affairs Minister Mr. Salman Khurshid was the Chief Guest while Union Minister of Law and Justice Mr. M Veerappa Moily was the Guest of Honour at the well-attended conference. Other speakers included Chief Justice of India Mr. Justice S.H Kapadia, Chairman Competition Appellate Tribunal Dr. Justice Arijit Pasayat and Competition Commission chairman Mr. Dhanendra Kumar. The undersigned also addressed the conference from professional perspective. The global competition law scenario vis-à-vis India, and various aspects of newly enforced Competition Law were discussed in the conference.

Asia-Oceania Standard Setters Group Meeting

We recently attended the second annual meeting of the Asia-Oceania Standard Setters Group (AOSSG), which was formed last year as a forum for the countries in the region to exchange their ideas and have a joint voice in matters relating to IFRSs. The undersigned, along with Council Member and the Chairman, Accounting Standards Board, CA. Manoj Fadnis and the Technical Director, Dr. Avinash Chander, put forth India’s approach and perspective on various issues of mutual interest that were discussed and decided at the meeting in Tokyo. We are happy to inform you that at the meeting it was decided to establish a new working group for IAS 41, Agriculture, which will be led by the ICAI. The meeting was attended by 24 accounting standard setting bodies from countries and jurisdictions in the Asian-Oceania region, representatives from the International Accounting Standards Board (IASB) and a Trustee of the IFRS Foundation.

Initiatives for Members
Unique Code (UCD) for Members in Practice Soon:

We are planning to introduce a unique code numbers to check the increasing instances of fraudulent practices including forged attestations, as part of our ongoing Project Parivartan initiated to change our operational processes to meet global benchmarks. Modalities are being worked out. We are being assisted by the software giant Infosys in this endeavour. Then, we would like our banks to insist upon this UCD, as people file different balance sheets for different purposes without the knowledge/approval of our members. Similarly, there are instances when financial statements filed in the tax department are different from the ones sent to banks or registrar of companies. Since the CA membership numbers are in public domain, introduction of UCD will certainly help in protection of our members.

Special Loan Scheme of Corporation Bank for CAs:

We take pleasure to inform our members that the Committee for Capacity Building of CA Firms and Small & Medium Practitioners has helped the Institute in going into an MoU with the Corporation Bank for providing financial assistance in form of liberalised loan scheme called Corp CA for our members and firms. Comptroller and Auditor General of India Shri Vinod Rai, Chairman & Managing Director of Corporation Bank Shri Ramnath Pradeep and Executive Director of Corporation Bank Shri Asit Pal were present on the occasion. This scheme will cater to various financial needs of members of the CA profession including cost of furniture/fixture/office equipments contributing in the working capital for building their profession. We sincerely hope that a large number of members would be benefited by this landmark scheme. We must acknowledge the hard work of the Committee Chairman, CA. Sanjeev Maheshwari behind this accomplishment. The details of the scheme have been hosted on our website and also published elsewhere in the journal.

New Group to Consider Provisions for Physically Challenged CAs:

We are happy to inform you that a Group has been constituted to consider and prepare a draft paper on the various concessions that one can have for physically challenged Chartered Accountants vis-à-vis the openings available in PSUs or in the private sector. The Group shall comprise CA. Vinod Jain, Chairman, Board of Studies (Convenor) and CA. Pankaj I. Jain, Chairman, Professional Development Committee. The said Group will submit as early as possible the aforestated draft paper to the Professional Development Committee and Board of Studies for consideration and making recommendations to the Council. The members of the Council may also be requested to give their suggestions/inputs for consideration by the Professional Development Committee/Board of Studies.

Tie-Up with United Stock Exchange for Currency Derivatives Awareness:

It is quite satisfying to inform you that we have operationalised the MoU signed last year with the United Stock Exchange (USE) of India Limited, newest stock exchange for currency derivatives, to impart comprehensive knowledge of financial markets to our members. Following this, the USE will sponsor our members by organising seminars, paneldiscussions, workshops on financial markets and corporate governance. We would provide institutional support and facilitate interactions with our members. At least two such programmes are proposed to be organised with them before the end of this year. On this occasion, Managing Director and CEO of the USE Shri T. S. Narayanasami expressed his ‘pleasure to be associated with ICAI’ and desired ‘to build knowledge about financial markets especially sophisticated instruments like currency derivatives in India.’ We are sure that this would be enriching experience for both the organisations.

IICA-ICAI Joint Workshop on IFRS:

We recently organised a special workshop on ‘IFRS – Issues in Transition’ jointly with Indian Institute of Corporate Affairs (IICA). The workshop dwelt on managing transition to IFRS that poses a great challenge to the makers and users of financial statements and to the reporting authorities, i.e., the practical implication of IFRS. Prominent personalities who shared their views in the workshop included Secretary, MCA Shri R. Bandyopadhyay, Shri Jitesh Khosla, Additional Secretary to the Government of India and Officer on Special Duty (OSD), IICA, Ms. Renuka Kumar, Joint Secretary MCA, Shri Pawan Kumar, Director (Tax Policy), Department of Revenue, Ministry of Finance, Ms. Gargi Ray of Infosys technologies, Past Presidents of ICAI CA. N. P. Sarda and CA. Ved Jain and Council members CA. Jayant P. Gokhale and CA. Bhawana Doshi. The undersigned highlighted the various steps taken by the ICAI in the process of convergence of Indian Accounting Standards with IFRS including the capacity building and other related initiatives. About 70 CEOs, Directors, CFOs, Auditors, representatives from regulatory bodies, fellow members of the ICAI and ICAI’s CA employees attended the workshop.

Four-Day Training Workshops on Audit Excellence:

Auditing standards issued by our Institute are both best practices and performance benchmarks for our profession, and the quintessential features of our very existence and supremacy in the auditing profession. To give an impetus to our awareness creation initiatives, four-day Training Workshops on Audit Excellence will be launched soon by the Auditing and Assurance Standards Board (AASB) of ICAI for imparting training on implementation of the Standards on Auditing issued under the Clarity Project. The details are available elsewhere in the Journal.

Resources on Auditing Standards:

A Guide containing practical guidance and ready-to-use templates on application of auditing standards to audits of small entities will soon be published to help with the understanding of auditing standards and promoting implementation of Standards. As another measure to promote the understanding of auditing standards, the AASB is also developing a Manual of Presentations on Standards on Auditing & Other Engagement Standards that will act as a quick reference for an overview of the requirements of auditing standards. This can be effectively used by the audit firms as well in training their audit staff on auditing standards.

Convocation Ceremony in Jaipur:

The convocation programme for the newly enrolled Associate Members of the Institute from Central Region (covering the states of Rajasthan and Madhya Pradesh) was successfully held at Jaipur on October 5, 2010. It was a time of celebration and of acknowledgement of our students’ hard work. The undersigned inaugurated the function and conferred the certificates of merit to the deserving and newlyenrolled members in the presence of Past President CA. Sunil Goyal, Central Council colleague CA. Anuj Goyal, past Central Council colleague CA. P. P. Pareek and Jaipur Branch Chairman CA. C. L. Yadav among others. While stressing the need of having effective communication skills, the undersigned informed the members about the growing recognition of Indian CAs internationally, and noted with appreciation the rising ratio of female members.

Certified Filing Centre Registration till November 2010:

We want to inform all members of our community that the registration process under the Certified Filing Centre (CFC) scheme is valid till November 30, 2010. We have received 271 CFC applications (88 new application and 183 applications for renewal of existing CFCs) from the members till date.

Students’ Initiatives
Residential Programme on Professional Skills & Development:

A six-week residential programme on Professional Skills and Development has been conceived by the Board of Studies for the benefit of our students and newly-qualified chartered accountants. All students who have passed PCC/IPCC/PE-II examinations and who are pursuing last year of the article training or those who are newly-qualified chartered accountants will be eligible for the programme and, therefore, are invited to join it. This will offer a unique opportunity to develop skills in communication, leadership and personality in general including the technical skills for effective functioning in profession. The programme will start on December 1, 2010, at the Centre of Excellence of ICAI in Hyderabad. In fact, more than 50 students have already been enrolled for this programme. In the meantime, a three-month residential programme shall commence from December 6, 2010, at National Institute of Financial Management in Faridabad. We sincerely hope to witness a large number of participants and we are sure they will use this opportunity to become better professionals. Such an active participation will encourage us further to hold similar and better programmes for them in future.

Online Articles Placement Portal:

We are glad to inform that the Board of Studies has introduced an optional Campus Placement Scheme for selection of Articled Assistants by CA Firms. The Pilot Campus Placement Programme was held at Delhi in August 2010 for the CA firms having their HOs/ Branch Offices in Delhi/New Delhi and for eligible students who would like to service their articles in the CA Firms in Delhi/New Delhi. Considering the good response, positive feedback and requests received from both CA Firms and Students, it has been decided to start an Online Articles Placement Portal – http://bosapp.icai.org from 5th October, 2010 to facilitate placement of Articles in CA Firms on pan India basis. We request both eligible candidates and CA firms to avail of this facility and register themselves online through the portal. The candidates shortlisted by CA Firms would be informed by e-mail through the Portal, to appear for interviews/interactions at their respective Offices, at the designated date and time.

CPT Online Examination results:

The results of CPT online examinations held on 18th and 19th September this year were declared recently and we are happy to inform you that the results (28.40 per cent) have been satisfactory. What is more satisfying is that our online examinations are slowly-but-steadily gaining popularity among new-age students and this portends well for our vision to make our examination system hi-tech and futuristic.

New Members Nominated on 21st Council of ICAI

We welcome Dr. T. V. Somanathan, Joint Secretary, Ministry of Corporate Affairs, New Delhi, and Ms. Usha Sankar, Director General (Commercial), Office of the Comptroller & Auditor General of India, New Delhi, as nominated members on the 21st Council of our Institute for the remaining term of the Council or till further orders. They have replaced Ms. Renuka Kumar and Shri K. P. Sasidharan respectively. We sincerely hope to get their complete help and support in all endeavours for progress of our Institute. We also place on record the valuable contributions made by Ms. Kumar and Mr. Sasidharan in the Council.

Meanwhile, we have submitted our comments/suggestions on Draft International Standard ISO 26000 (Guidance on Social Responsibility) and on Applicability of Foreign Direct Investments in LLP to the Ministry of Corporate Affairs (MCA).

Deepawali, the pious festival of lights, is the celebration of the victory of good over evil. The underlining message of this festival is that the evil and falsehood may appear to be mightier and more resourceful but it is only the truth and good that prevails in the end. Let’s imbibe the spirit of this festival and take a vow to lead the world from darkness to light, from falsehood to truth, and from wrong to right. Let us vow to live each day in the most pious, God-conscious way. This Deepawali let us give thanks for all we hold dear: Our health, our family, our friends and to the grace of God which never ends. May this Deepawali fill your life with prosperity and peace, and love and joy which doesn’t cease. May the festival of lights be the harbinger of growth of our profession.

CA. AMARJIT CHOPRA
President, ICAI
October 25, 2010

CA Students Download November, 2010 Exam Admit card..

Subject: Change of Examination Centers for November 2010 CA Exams

Due to paucity of accommodation in some Zones opted by the candidates in the cities of Bangalore, Chennai , Delhi, Indore and Kolkata, some of the candidates have been allotted examinations centres in other zones of the said cities where the accommodation is available. In view of this, it is not possible to accede to the requests of the candidates for transfer to an examination centre in a particular zone of the city opted by them.

While inconvenience caused in the mater is deeply regretted, we seek the valuable cooperation from the ICAI students and their stakeholders in the regard.

(Dr. T. Paramasivan)
Sr. Deputy Director (Exams)

Applications for admission to Common Proficiency Test is required to be made in the relevant prescribed form as contained in the Information Brochure, which may be obtained from the Senior Deputy Director (Examinations), The Institute of Chartered Accountants of India, ICAI Bhawan, Indraprastha Marg, New Delhi – 110 002 on payment of Rs. 600/-(Rs.500/- towards examination fee and Rs. 100/- towards cost of application form and Information brochure) per application form. The fee for candidates opting for Abu Dhabi , Dubai, Doha and Bahrain centres will be US $160 ( US $ 150 towards examination fee and US $ 10 towards cost of application form and information brochure) or its equivalent Indian Currency. The fee for the candidates opting for Kathmandu centre is INR.950/-(INR 850/- towards examination fee and INR 100/- towards the cost of application form and information brochure) or its equivalent foreign Currency.

Since the cost of Information brochure containing Common Proficiency Test application form includes the examination fee , no separate fee is required to be remitted at the time of submitting the filled in application form. The Information brochure containing Common Proficiency Test application form will also be available in the Regional and all Branch Offices of the Institute and can be obtained there from on cash payment till 27th October, 2010. The forms will not be available in any branches of the banks.

Common Proficiency Test application forms duly filled in may be sent so as to reach the Senior Deputy Director (Examinations) at New Delhi not later than 27th October,2010 . Applications received after 27th October, 2010 shall not be entertained under any circumstances.

Applications duly filled in will be received by hand delivery at the offices of Institute at New Delhi and at the Decentralised Offices of the Institute at Mumbai, Chennai, Kolkata, Kanpur, Ahmedabad, Bangalore, Hyderabad, Jaipur and Pune upto 27th October ,2010. Candidates residing in these cities are advised to take advantage of this facility. It may be noted that there is no provision for acceptance of application forms after 27th October, 2010 with late fee.

Alternatively the candidate may fill up the examination application form online at http://icaiexam.icai.orgfrom 6th October ,2010 ( 10:00 hrs) to 27th October ,2010 ( 17:30hrs) and remit the fee online by using credit card, either VISA or Master Card. The Institute with a view to popularize hassle free online registration of CPT – December PP Mode application form is pleased to announce a concession of Rs 100/- (Rupees hundred only) to those who are filling up and submitting the application form for CPT- December 2010 (PP Mode).

Accordingly, the examination fee for those who apply online opting centres in India will be Rs. 500/- (Rupees five hundred only) instead of Rs. 600/- (Rupees six hundred only) and Rs. 850/- (Rupees eight hundred fifty only) instead of Rs. 950/- (Rupees nine hundred fifty only) for those who opt for Kathmandu centre.

Do you have any query about NOVEMBER, 2010 examination?

The Help Line Desk will be functional from 18th October to 16th NOVEMBER, 2010 for 24 hours on all days (inclusive of holidays and Sundays) to attend to any query relating to the ensuing Chartered Accountant Examinations to be held from 8th to 16th NOVEMBER, 2010. The telephone Numbers of Help Line Desk are:

3054851

3054852

3054853

3054835

(0120) 3054843 (FAX)

STD Code 0120

Students having any query with regard to their appearance in the ensuing examination are welcome to contact the Help Line Desk on the above telephone numbers. The query could be non-receipt of Admit Card or any other matter related thereto.

Students who have not received their admit cards can download it from website www.icai.nic.in

Separate e-mail IDs have been created to cater to the needs of the students. The student can contact at:

pce_examhelpline@icai.in for Professional Competence Examination

ipce_examhelpline@icai.in for Integrated Professional Competence examination/Accounting Technician Examination

final_examhelpline@icai.in for Final Examination

Students who have not received their Admit Cards or could not download the same from the Website and desirous of getting information regarding appearance in the examinations may utilise this facility for prompt response from ‘help-line desk’ of Examination Department of ICAI.

(Dr.T. Parmasivan)
Sr. Dy. Director (Exam.)

It has been brought to our knowledge that certain SMSs/e-mail chains have been generated claiming that the Institute has changed the passing requirements of its various examinations w.e.f. November, 2010 examinations.

It may be clarified that the said SMSs/e-mails are baseless and the existing requirements as per the relevant CA Regulations will continue to apply for November, 2010 examinations as well.

Students of ICAI and their stakeholders are advised not to be carried away by these sorts of unfounded/non-authentic messages. They are requested to rely on the Announcements hosted on the Institute’s website www.icai.org or `The Chartered Accountant Student’ the Students Newsletter of ICAI

Examination Department

Copies of the balance sheet, tax audit reports and similar documents attested by chartered accountants as part of several million mandatory filings done by companies across the country each year may soon have a unique code number as authentication.

The Institute of Chartered Accountants of India (ICAI), the apex auditing standard setting body, is planning to introduce such unique code numbers (UCD) to check the increasing instances of forged attestations, said Amarjit Chopra, president. The UCD will be developed as part of Project Parivartan, an 18-month programme initiated by ICAI to change its operational processes to meet global benchmarks. Software major Infosys is assisting it in developing this Unified Digital Technology Platform, which includes creation of UCD.

“We want the banks to insist upon such unique code numbers, as there are several instances where people file different balance sheets or utilisation certificates for different purposes without the knowledge or approval of our members,” Chopra said.

According to him, there are instances where the financial statement produced before the tax department is different from the one sent to banks or the registrar of companies. “The forgery happens because the chartered accountant’s membership number is in the public domain. A UCD can make this difficult,” Chopra adds.

The authenticity of attested documents is important enough in cuRBIng corruption for the anti-corruption watchdog, Central Vigilance Commission, to have come out with a code of ethics for chartered accountants.

While the project has been conceptualised, the modalities for operating this are yet to be worked out through Project Parivartan, Chopra said.

Project Parivartan was conceived with an idea of taking ICAI to a qualitatively new way of working, which would bring together both aspiring and existing chartered accountants. It was to take a comprehensive view of existing processes and benchmarks these with global best practices. Infosys, which will partner with ICAI to develop the programme, is also running the programme management office for the institute.

Accounting regulator Institute of Chartered Accountants of India (ICAI), said it is seeking power to take action against erring firms.

“As per the Act, the institute can take disciplinary action against our members but not against other firms. It is becoming extremely important to curb ill practices. So, for the first time, the ICAI has decided to recommend the Union government that power to act against firm be given to the institute after necessary amendments in the Act,” ICAI President Amarjit Chopra told reporters on the sidelines of an an event here.

“We want more powers to ensure that big corporate scandals do not occur in future. In cases where firms are committing objectionable deeds, the power will prove helpful.”

Chopra said that on its website the institute has also made available the list of 123 members who were found guilty by its committee that looks into disciplinary-related issues.

“We want our profession unspoiled and transparent hence the institute has made available the list on the website. This is also the first of its kind initiative taken by the institute,” Chopra claimed.

ICAI Central Council Member Anuj Goyal, ICAI Chairman- Jaipur Branch C L Yadav and other members were also present at the event.

The auditing restructure will imbibe the spirit of banking regulator Reserve Bank of India’s (RBI’s) Know Your Customer (KYC) principles and help check financial frauds, identify money laundering and suspicious activities and scrutinise large cash transactions.

The proposed changes had been submitted to the Indian Banks’ Association, Amarjit Chopra, president of ICAI said.

“Currently, the auditors are bogged down by routine auditing requirements and are unable to be vigilant against possible frauds. Once the audit requirements are restructured and re-prioritised, auditors can ensure compliance level with credit dispersal and take care of overdue bills, payments etc,” Chopra said.

The apex bank has been stressing on KYC guidelines to safeguard banks from being used for the transfer or deposit of money from suspicious origins.

The new system, if approved, will allow auditors to ensure even the authenticity of customer identification methods followed by banks.

Under KYC norms, banks are required to issue travelers cheques, demand drafts, mail transfers and telegraphic transfers of Rs 50,000 and above only by debit to customers’ accounts or against cheques. Similarly, banks are required to keep a close watch on cash withdrawals and deposits of Rs 10,00,000 and above and maintain proper records of such transactions.

RBI’s KYC guidelines talk about the establishment of internal control systems, checks against terrorism finance, need for periodic, independent evaluation of such controls and adherence to the Foreign Contribution Regulation Act.

According to Chopra, the new responsibilities will also see that auditors are eligible for much higher fee than what they charge.

“The fee levels in concurrent audit (in banks) are abnormally low keeping in view the stipulations in the agreement. The revised proposal will definitely lead to prioritising those work requirements and also set a minimum fee structure.”

The Institute of Chartered Accountants of India has entered into a into a mutual recognition agreement (MRA) with the Institute of Certified Public Accountants In Ireland (CPA Ireland). This agreement offers both bodies the opportunity for key strategic partnerships and supports trade opportunities between the two countries by fostering peer to peer relationships. The MRA facilitates global careers opportunities for members of both the Institute of Chartered Accountants of India and Irish certified public accountants, as it provides a route for qualified members to become members of each other Institutes.

The MRA offers CPA Ireland and ICA India the opportunity to work more collaboratively, providing increased levels of service to members, undertaking joint research and thought leadership initiatives on the global stage, and acting as advocates within the International Federation of Accountants (IFAC) and regional accounting networks.

The agreement does not cover those wishing to practice as a public practice accountant and/or to undertake auditing work due to the specific regulatory and legal requirements in each jurisdiction. The MRA comes into effect on 01 October 2010.

The details on the route to become members and relevant forms shall be uploaded shortly in the website of ICAI.

The Institute of Chartered Accountants of India (ICAI) is a statutory body established under the Chartered Accountants Act, 1949 (Act No. XXXVIII of 1949) for the regulation of the profession of Chartered Accountants in India. During its nearly six decades of existence, ICAI has achieved recognition as a premier accounting body not only in the country but also globally, for its contribution in the fields of education, professional development, maintenance of high accounting, auditing and ethical standards. ICAI now is the second largest accounting body in the whole world.

The Institute through its Committee for Members in Industry (CMII) organizes campus placement programme for the benefit of newly qualified chartered accountants twice every year. The CMII provides opportunity to the employers to interact with newly qualified Chartered Accountants and makes all arrangements at its centres, thereby providing a cost effective mode of recruiting newly qualified Chartered Accountants. Organisation and firms of Chartered Accountants can participate in one or more centres.

The placement programme was successfully conducted in the months of August-September, 2010. The programme was organized in 16 cities across the country and got concluded on September 25, 2010. It was organized in different phases in Ahmedabad, Bangalore, Bhubaneswar, Chennai, Coimbatore, Ernakulam, Hyderabad, Indore, Jaipur, Kanpur, Kolkata, Ludhiana, Mumbai, Nagpur, New Delhi and Pune

In all 155 interview teams representing 87 companies participated in the programme seeking chartered accountants for jobs. Overwhelming response was received from all the centres. The entities selected Chartered Accountants and made lucrative offers. More than 1300 candidates got job offers.

Prominent organizations from diverse array of industries like Manufacturing organizations, Public Sector Undertakings, Banks, Software, Consultancy, financial services, etc. participated in this mega event. There was heterogeneous mix of recruiting entities both from India and abroad representing wide range of industries and sectors

The best offer of Rs. 21 lacs per annum was made by Tolaram Corporation Pvt. Ltd. to 3 candidates for international posting. For a domestic posting best offer of Rs. 15 lacs per annum was made by Abhishek Industries. Organisations such as Britania, ITC and Bharat Petroleum Corpoartion Ltd. have offered the salary of more than Rs. 10 lacs per annum to newly qualified Chartered Accountants. The responses given by the entities willing to participate at these centres for recruitments has been very encouraging. The minimum salary that was offered was Rs. 3.25 lacs per annum.

The growing popularity and success of the institution is drawing more and more students across the country and the big companies for the placement programme. Candidates are very satisfied with the placement programme. The future of the profession envisages the amalgamation of the present knowledge economy and the expectations of the stakeholders. The ICAI is striving to develop its professionals to aquire skill sets as required by the emerging economy.

Water, water, everywhere, And all the boards did shrink; Water, water, everywhere, Nor any drop to drink.

18th century English poet S. T. Coleridge, in the above lines, has represented the current situation in some of the densely-populated regions of our country. It has rained more than our needs this year. Hundreds of acres of land across our country have got submerged under water. Hundreds of kilometers of our roads have been washed away. Hundreds of people have been displaced, stuck and stranded, and rendered helpless. No real data is available on the destruction of human life. Immediate concern at present is to safeguard our human resources. Let us accept that we have added to the misery by eroding our own earth and destroying its vegetation on a mass scale. Actually, we have grown high in number. Couldn’t we have controlled this eventuality? Our world is small and round: our irresponsibility comes back to us.
 
What can we do when things go out of our hands? No, nothing goes out of our hands ever. Therefore, time is always right to take a corrective measure. Let us deliberate, share our ideas and concerns, and cooperate towards the welfare of state.

International Initiatives and Concerns

MRA with CPA, Ireland: We are delighted to inform that our Institute has signed recently its fourth membership recognition MRA with CPA Ireland for reciprocal recognition of each other’s qualification on a variable bridging mechanism. The agreement was signed on the sidelines of the IFAC Board meeting which took place in Paris. The MRA was signed in the presence of Mr. Robert Bunting, President, IFAC and CA. Ved Jain, Past President, ICAI and IFAC Board Member. The agreement will come into force w.e.f. October 1, 2010. We sincerely hope that our members would be benefited from this MRA. We have also initiated steps for having similar arrangements with the accountancy institutes of other countries like Canada, New Zealand and South Africa.

MoU with Higher Colleges of Technology, UAE: We would like to inform that the MoU with the Higher Colleges of Technology, UAE, pending on account of clearance from the Government authorities, has now got the clearance. The formal signing of the MoU is awaited.

New ICAI Chapter in UAE: We are very pleased to share that the 22nd Chapter of the Institute at Ras Al Khaimah in the Middle East has been added in the list of existing international Chapters. The formal inauguration ceremony of the Chapter would be held after the completion of procedural formalities at their end.

International Seminar on CSR in Dubai: The undersigned attended a seminar in Dubai on Corporate Social Responsibility for Finance and Accounting Professionals on September 5, 2010, organised by Dubai Chapter of the ICAI in partnership with the Dubai Chamber Centre for Responsible Business as an effort towards raising awareness on responsible business practices, and shared the ICAI’s commitment towards CSR with the participants. The seminar was attended by Shri M. K. Lokesh, Ambassador of India to UAE, Mr Hassan Al Hashemi, Director, External Relations, Dubai Chamber, Padamshree Dr. B. R. Shetty, Managing Director and CEO, NMC Group and Dr. Belaid Rettab, Sr. Director, Dubai Chamber of Commerce and Industry. The undersigned informed the participants about the ICAI’s CSR initiatives like Go-Green campaign and Carbon Credit Accounting Sustainability Reporting, and mentioned that the ICAI endeavours to help its members maintain and adhere to its Ethical Standards, and also shared cases of some Indian Companies like WIPRO, Tata, Birla, etc., who have been committed to CSR even before they became global.

ICAI Participation in IFAC Board Meeting: The undersigned attended the IFAC Board meeting along with ICAI past-President and Member IFAC Board CA. Ved Jain, during September 8-10, 2010. We discussed the strategic plans of the IFAC focusing on quality and development. During the meeting, the Exposure Draft on Public Interest framework was discussed. While expressing the Indian concerns, we expressed our interest in becoming the associate member of International Valuation Standard Council (IVSC) particularly in view of the IFRS implementation. The undersigned, in response to the presentation made by the Forum of Firms, raised the issue of monitoring by the Forum with respect to the firms that were involved in the audit of an entity involved in scam. It was clarified that the Forum does not have any mechanism for policing or taking action against a firm or its partners. This position raises concerns and needs to be re-looked by the Forum.

ICAI Representation in Working Group on PAIB Review: The undersigned also attended the Edinburgh Group meeting coinciding with the IFAC Board meeting, where, besides the key issues of SMPs, communication strategy paper for the Group was discussed. The Group also met the IFAC leadership to discuss the SMP Task Force Report and other operational issues. It set up a Working Group on PAIB (Professional Accountants in Business) Review to develop agenda items on the PAIB issues. Ms. Marta Rejman, Member of IFAC Board, Ingrid Doegra and the undersigned would be the members of the said Working Group.

ICAI Meets ICAEW: The undersigned along with the Vice-President CA. G. Ramaswamy met the President, ICAEW, on September 14, 2010, in London to augment and further strengthen the MRA between the two Institutes. Acting Chairman of the London Chapter of ICAI was also present. We discussed our interest in ICAEW’s IFRS certificate course, e-learning modules on IFRS, the literature on Strategic Finance. We clarified that we can not recognise the members of ICAEW through the route of ACCA till the said body stops setting up its shops in India. Issue of equivalence of qualifications amongst the six accounting bodies in Great Britain, e.g. ICAS, ICAI, CIPFA, CIMA, etc., who are authorised to carry out the public accountancy function was discussed. The same aspect was also conveyed to the Indo-UK Accountancy Task Force authorities afterwards. We informed them that Indian students are being tested under case study situation and that papers on case study to be undertaken by our CAs should be reviewed. The two sides agreed in principle to encourage the members of respective institute to take a membership under the existing MRA.

Auditing and Accounting History Conference in Turkey: The undersigned along with the Vice-President CA. G. Ramaswamy and Director, Board of Studies, Shri Vijay Kapur participated in the 2nd Balkans and Middle East Countries Auditing and Accounting History Conference held in Istanbul from September 15-18, 2010. The undersigned also had the privilege to Chair one of the sessions on Internal Auditing. Approximately 600 academics from 55 countries participated and contributed 240 papers for discussion. We could showcase our country, particularly with regard to our Accountancy Museum of India. The same was well-covered in the media.

ICAI Helps CPA Mongolia: Council Members, CA. Charanjot Singh Nanda and CA. Vijay Garg have been deputed to visit Mangolia shortly for an interaction with CPA Mongolia. As CPA Mangolia is aspiring for attaining IFAC membership which would involve technical cooperation in making them compliant with IFAC SMOs, the assistance of ICAI has been sought in this matter.

International Conference on Accountancy in January 2011: We are pleased to share with you that we will organise an international conference during January 4-6, 2011, in New Delhi, to be attended by prominent personalities from accountancy profession of different parts of the world. Over 1500 stakeholders, specifically from Asia-Pacific region, will participate in it. The Conference will facilitate an assimilation of resources in areas of financial reengineering, governance, harmonization of standards, SMP context, accountants and millennium developmental goals and so on, in the emerging context. The schedule of the conference will soon be finalised.

ICAI in WTO Public Forum: Our Central Council colleague CA. Raj Kumar Adukia with Shri Rakesh Sehgal, Secretary, Committee on Economic & Commercial Laws and Trade & WTO, represented us in the WTO Public Forum, The Forces Shaping World Trade held in Geneva from September 15 to 17, 2010. The Forum was attended by nearly 800 international delegates and this provided an opportunity to discuss the emerging paradigm of world trade and, inter alia, dwelt on issues faced by services sector, trade and inclusive growth and alike.

Report on Companies Bill, 2009: Need to Reconsider

The Parliamentary Standing Committee on Finance, through its 21st report on the Companies Bill, 2009, has sought to bring significant changes in the Bill. Certain aspects of the Report need a thorough re-look. Clause 118 of the Bill deals with the Constitution of National Advisory Committee on Accounting and Auditing Standards (NACAAS). Introduction of Auditing Standards in the Companies Act in this clause will lead to duplication and delays without any gains. We would be left with the role of drafting the accounting and auditing standards and to assist the NACAAS, which will depend on us for preparing the original material. It is but logical that, having the expertise, we should continue with our role of framing the auditing standards and other authoritative literature for compliance. We issue Auditing Standards complying with the standards issued by the International Auditing and Assurance Standards Board (IAASB), a body constituted under the aegis of the IFAC. Observation by the MCA that Auditing Standards are issued by a ‘single institute’ is, in our opinion, misconceived. We issue the standards after the consideration of the comments received from various interest groups by the Auditing and Assurance Standards Board which consists of our Council members and representatives of the RBI, the SEBI, the C&AG, etc. Then, the vetting of these Standards by a body with no experience in the conduct of audit is not desirable. This issue needs a serious consideration, as this is a matter of our losing control over the area of expertise. Otherwise, the very purpose of bringing the Act of 1949 to create an autonomous body under an Act of Parliament would be lost.

Clause 123 dealing with the appointment of auditors, Clause 124 Eligibility, qualifications and disqualification of auditors, Clause 125 Remuneration of auditors, Clause 126 Powers and duties of auditors and auditing standards and Clause 130 Punishment for contravention also need to be further deliberated and given due consideration. Therefore, it has been decided to form a group at all-India level for drafting our response to various recommendations of the Report.

IFRS Convergence Status: NACAS Acceptance

The Draft of Ind-AS 41 (Corresponding to IFRS 1), first-time adoption of the Indian Accounting Standards, was considered by us recently. Meanwhile, National Advisory Committee on Accounting Standards (NACAS) has agreed to our view that, out of AS 30 (corresponding to IAS 39) or AS 40 (corresponding to IFRS 9), only AS 30 should be made applicable. It has approved Accounting Standards on Financial Instruments, i.e. AS 30, 31 and 32 with certain changes in AS 30 and AS 31. NACAS has also decided not to include IFRIC 15 on accounting of agreements for the construction of real estates in AS 9, Revenue Recognition, keeping in view the conflict displayed by us. The scope of AS 7, Construction Contracts, has been modified to the effect that accounting for real estate developers would be in the scope of AS 7. By implication, the real estate developers have to follow Percentage completion method rather than completion method, once the change is notified by the Government NACAS has approved the revised Schedule VI to the Companies Act, 1956, for recommending the same to the Ministry of Corporate Affairs for notification.

Regarding AS 18 (corresponding to IAS 24), Related Party Disclosures, NACAS has suggested that the term ‘Domestic Partner’ should not be removed. With regard to our suggestion to recognise gain on bargain purchase in case of business combinations in ‘Capital Reserve’ instead of ‘Profit and Loss’, NACAS has suggested to recognise the same in ‘Other Comprehensive Income’. With regard to recognition of actuarial gains and losses arising on defined benefit obligation and related defined benefit plan, draft of AS 15 (Revised 20XX), Employee Benefits, requires the same to be recognised immediately in profit or loss. NACAS has suggested that the entire amount of actuarial gains or losses should be recognised immediately in ‘Other comprehensive income’, keeping in view the suggestions of industry representatives on NACAS and principles given in this regard in the Exposure Draft on IAS 19 issued in April 2010 by the IASB. We have agreed with their suggestions.

Revised Practitioners’ Guide for SMPs

We have come across a lot of apprehensions with respect to the number of auditing standards being issued by us and the difficulties faced in their implementation in audit of smaller audit clients. In an increasingly qualityconscious world, application of the Standards is not just our obligation but a rightful demand of our clients that we pledge to serve. We have taken strong and proactive confidence-building measures to help our SMPs in joining the mainstream of the profession and grow, e.g. Revised Practitioner’s Guide to Audit of Smaller Entities that takes a very comprehensive approach to implementation of all the auditing standards in case of audit of small clients. We urge our members too to come forward and accept the challenges that necessarily appear in any growth story. In addition, we are organising many awareness programmes in this regard.

Implementation Guide to SAs 700, 705 and 706

Reporting is the culmination of the auditor’s work. As the members would be aware, the Institute has issued three critical Standards on Auditing to deal with different aspects of reporting. To help our members understand and implement these Standards in actual audit situations, we will bring out an Implementation Guide to the three reporting Standards, i.e. SA 700, SA 705 and SA 706, issued under the Clarity Project. The Implementation Guide will be in an FAQ form and will contain many illustrative situations requiring various types of audit opinions.

Technical Guide on Internal Audit for BPOs

The Internal Audit Standards Board of the ICAI has finalised and issued the Technical Guide on Internal Audit of BPO Industry to deal with the complexity of processes which give rise to a spectrum of strategic and operational risks. With sound domain knowledge, good analytical skills, and process understanding, chartered accountants would be able to plug into the position of the internal auditor of this (BPO) industry.

Consideration of Drafts on ASLB

The Council recently considered and approved the draft of ASLB (Accounting Standards for Local Bodies) 1 Presentation of Financial Statements. The draft will be circulated among our Council colleagues and other external specified bodies for comments. The IPSAS 24 on Presentation of Budget Information in the Financial Statements is relevant to this Standard. Accordingly, it was decided to take up a project for formulation of the corresponding ASLB. We also considered the basic draft of the proposed ASLB on ‘Inventories’ and proposed certain changes in it.

MCA Requests ICAI to Develop Uniform Accounting/Reporting Fabric

Another Group was formed, at the request of the MCA, for developing uniform accounting/reporting framework for NGOs under the convenership of our Central Council colleague CA. S. B. Zaware. The Group would suggest and recommend an appropriate format of financial statements and financial control guidelines, and methods of accounting to be followed by NGOs governed by Societies Registration Act, 1860. It would examine the laws to monitor the fundflow to NGOs under extant laws, e.g. FEMA, Income-tax Act, etc., and suggest a framework considering the features of all these Acts for proposing a regulatory model for monitoring the fund-flow. Committee on Economic & Commercial Laws and WTO has been instructed to deal with rest of the concerns arising out of the MCA communication to us.

SEBI Amendments in Listing Agreement and Draft Certifcates

Securities and Exchange Board of India had recently amended clause 24 of the Listing Agreement, requiring the auditors to certify that the scheme of merger/ acquisition are in accordance with the applicable accounting standards. The Institute has already developed the draft formats of such certificate to be issued by the auditor. These draft formats will be available soon for the guidance of the members.

Roundtable on Commerce and Accountancy Education

We are happy to inform all our members and students that, to increase the scope of accountancy education, we are organising a roundtable conference on Commerce and Accountancy Education in India: Issues and Challenges on September 26, 2010, in New Delhi. Vice- Chancellors, heads of department and senior professors of commerce and finance of all established and recognised universities of the country have been invited to participate in the conference, which will provide a platform to discuss the new paradigms for commerce and professional accountancy education in India. This conference will help the academic foresee the bigger picture of accountancy and commerce education, and help us to rebuild our further strategies accordingly.

Assurance of Land to Bhopal Branch of ICAI

ICAI Vice-President CA. G. Ramaswamy and the undersigned attended the 31st Regional Conference of the CIRC, hosted by Bhopal Branch on August 28, 2010. CA. Shri Rameshwar Thakur, Hon’ble Governor of Madhya Pradesh and our Past President inaugurated the Conference. Shri Thakur assured us to allot land for the premises of Bhopal Branch of CIRC of the ICAI. Later, we also met the Hon’ble Chief Minister of the State, Shri Shivraj Singh Chouhan, and discussed the services that chartered accountants render to the State.

Project Parivartan

This Project was conceived with an idea of taking ICAI to a qualitatively new way of working which would bring together both aspiring and existing chartered accountants in the country. The project took a comprehensive 360 degree view of the existing processes and benchmarked them with the global best practices. Accordingly, a need to change the current operational processes of the Institute to meet global benchmarks has been made and a roadmap evolved for the adoption of a Unified Digital Technology Platform that will be used to transform ICAI into a truly efficient, transparent and global organisation. Infosys Technologies has partnered with us to help in formulating our vision, roadmap and an 18-month plan for Project Parivartan. Infosys will also help us in running the Program Management Office towards our dream of Parivartan.

Status of Disciplinary Cases

As regards the status of Disciplinary cases, we would like to inform that, under the old disciplinary mechanism, hearing in 58 cases has been concluded by the Disciplinary Committee of the Institute. In the Council Meeting recently, 55 reports were included and 10 more reports are ready for inclusion. Under the new mechanism, the Board of Discipline and Disciplinary Committee have completed hearing in 54 cases. The Board of Discipline/Disciplinary Committee has also considered primafacie opinion of the Director (Disc.) in 33 cases. In addition to the above, prima facie opinion of the Director (Discipline) in approx. 75 complaint and information cases would be considered by the Board of Discipline or Disciplinary Committee as the case may be. All efforts are being taken to complete the public interest cases on priority, irrespective of the mechanism in which they are falling.

Concerns for Members

Banks to Open List of Auditors in 2:1 Ratio: We are happy to inform that the persistent efforts of Professional Development Committee with regards to the appointment of auditors for the banks have paid off. We have successfully convinced both the Ministry of Finance and the RBI not to open the complete list of eligible central statutory auditors for banks to select their auditors. Accordingly, the list of auditors has been released in the ratio of 2:1, i.e. names of two auditors will be given against one vacancy. Next year, we would try for the 1:1 ratio. We deeply appreciate the efforts made by our Central Council colleague CA. Pankaj I. C. Jain, Chairman, Professional Development Committee in this regard.

Seeking Data on Tax Audit from CBDT: We have sent a letter of request to the Central Board of Direct Taxes (CBDT) asking them to provide the number of tax audit reports filed with them during 2009-10, e.g. data on tax audit based on fields like name and membership number of the auditor, assessment year, PAN of the auditee, etc., which would enable us to review the ceiling on the number of tax audit assignments that a chartered accountant can accept in a financial year, either as a partner or a proprietor.

ICAI Recommendations of Amendments in the CA Act, 1949: Our Council had constituted a Group on Amendments in the Chartered Accountants Act, 1949, under the convenership of ICAI Vice-President, CA. G. Ramaswamy, to suggest draft amendments in the Act arising out of the Report of the High-Powered Committee so as to empower the Act to take disciplinary action against erring CA firms, only in grave circumstances and, also, in cases of repetition of gross negligence by their partners. In addition to our Council colleagues’ suggestions on table, they have also been asked to send their written comments, if any, for consideration of the Group.

Group to Resolve Dispute for Members: A new group has been constituted recently under the convenership of our Central Council colleague CA. Nilesh Vikamsey to examine the matter of development of an alternative dispute resolution mechanism (arbitrator) for dealing with disputes of member vis-à-vis member and member vis-à-vis student, and bringing the same back to the Central Council with its recommendations.

Auditors, Remuneration and Indian Banks: We have made a representation to Shri G. Gopalakrishna, Executive Director, Reserve Bank of India regarding the revival of Category of Part C auditors for audit of Public Sector Banks. We have sent a letter to NABARD Chairman Shri Umesh Chandra Sarangi regarding appointment and remuneration of auditors of state and district central cooperative banks. Indian Banks Association has appreciated the suggested coverage of the report on concurrent audit of banks as comprehensive and has stated that it covers the major functions of the branches.

Webcast on Direct Tax: The Direct Taxes Committee has conducted a live webcast recently, where the undersigned along with the ICAI Vice-President CA. G. Ramaswamy and Central Council colleague CA. Dhinal Shah participated in deliberations of the webcast from Chennai. The Committee Chairman and Vice-Chairman CA. Jayant Gokhale and CA. M. Devaraja Reddy respectively participated in the webcast from Delhi and provided their valuable inputs.

Cause of Concern: US Move to Discourage Outsourcing: As members are aware that fee hikes for H1-B visas and Ohio’s decision to ban outsourcing of government IT projects will directly affect Indian tech workers and Indian companies in the US. US President Barack Obama now intends to end corporate tax breaks for US companies that “create jobs and profits in other countries. This move has triggered consternation across India’s US$50 billion annual outsourcing industry. It is indeed a matter of concern, although the issue of tax breaks is not going to have a direct impact on our accountancy profession or our outsourcing business, because the US companies are outsourcing to India for better operational efficiency and to arbitrage labour costs, not taxes, as Indian corporate tax rates are actually higher than those in the US. Blocking of tax breaks is unlikely to be enough detriment for US companies to stop outsourcing. However, what is more worrying is the trend of ‘populist extra-protectionism’ that US is trying to set, which might affect Indian CA professionals in the long run. In this age of globalisation, such protectionist barriers can only prove to be detrimental. We would advise the interested members to prepare themselves to face such protectionist trends as well.

Students’ Matters

Students necessarily have an element of idealism and the world becomes better when they enter into the institution of a family with their idealism. This is called a gift of the new world. We would like to appeal to our members to encourage such endeavours in students during articleship. Meanwhile, we will continue to take strong measures in the students’ interests:

Reduction in Scale of Entitlement to Train Articled Assistants: The Executive Committee has discussed and rationalised the criteria for entitlement to train articled assistants by an Associate/ Fellow member or a full-time employed chartered accountant considering that a large number of vacancies remain unfilled especially in the case of SMPs. On the recommendations of the Committee, our Council has considered the reduction in scale of entitlement to train articled assistants, as a large number of vacancies are unfilled due to the change in scheme and education wherein students are entitled to commence article only after passing IPCC instead of immediately after passing CPT examination.

International Conference on Indian Accountancy Profession: An international conference of CA Students would be organised on December 28-29, 2010, in Delhi jointly by the Board of Studies and the NIRC of the ICAI. Theme of the conference would be Indian Accountancy Profession – Marching towards Global Centre Stage. Detailed announcement will follow in the students’ Journal and in the Newsletters of other Regional Councils and Branches. We sincerely hope that our students will actively participate and make it a success.

Eligibility for admission to CPT examination: The Council, realising the difficulties faced by students, has decided that the students who have not passed 10+2 examination but have passed any other diploma course and later have pursued graduation are eligible for the CPT examination. The same is being taken up with the Central Government for necessary approval.

Residential Course: We have decided to organise the residential course on General Management and Communication Skills (GMCS) at more centres so that a large number of students can be benefited. The duration of the course will be reduced to six weeks from three months. And, top 10 rank-holders in the PCC/IPCC and Final examinations will be enrolled for the sixweek course without any fee.

Live Virtual Classes: Considerable progress has been made to start Live Virtual Classes (LVC) for CPT, IPCC and Final courses of the CA curriculum. The conduct of classes would commence very shortly and we are hopeful that a large number of students would derive benefit from these classes.

Campus Selection for Articled Assistants: An optional campus placement scheme has been introduced for selection of articles. The Pilot Campus Placement Programme was held at Delhi in August 2010 for the firms having their offices in Delhi. 41 CA firms and 390 students registered for the programme, and, out of these, 31 firms and 148 students participated. Considering the positive response, feedback and request from both firms and students, it has been decided to start an Online Articles Placement Portal to facilitate placement of articles in firms on pan-India basis. Eligible firms and candidates can register at http://bosapp.icai.org that would be opened shortly.

Nationwide Programmes/Conventions: 21 one-day seminars were successfully organised across the nation. Regional Councils and Branches of the ICAI organised elocution and quiz contests. Branches also organised 34 careercounseling programmes to popularise the CA course. Ernakulam Branch of ICAI hosted a state-level conference. A twoday National Convention of Students was held in Kolkata and attended by almost one thousand students. Chief Guest and Special Guest on the occasion were Minister-in-charge, PWD, West Bengal, Shri K. Goswami and former Indian cricket captain Shri Sourav Ganguly respectively. Shri T. N. Manoharan, former ICAI President, and the Chairman and the Director of the Board of Studies also addressed the students.

VI Pay Commission and ICAI Officers’ Pay Revision

We are extremely happy to inform that the issue regarding the pay revision of the ICAI officers based on the recommendations of the VI Pay Commission was largely completed by the appointed Group. We are sure that this decision will further motivate our officers towards their responsibilities and strengthen their bonds with the Institute.

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Commonwealth Games, Delhi’s biggest-ever event, are approaching fast. So much has been said for our preparations and efforts in this regard. Isn’t it too late to speak our concerns over this? Demand of the hour asks us to be positive and to try to add to the success of the event and to the comfort of our athletes, both national and international, and other guests. Let us speak positive. We grow together learning from each other. We all are responsible people. Let us behave more responsibly. Let us put in our concerted efforts to make it a spectacle by understanding our role in it.

Let us try to make this event a success by celebrating the occasion and we are sure to remember it as an event of national pride in retrospect. Let the festival of Dussehra speed up our win over the evil. We wish everybody a very happy and joyous Dussehra.
Best Wishes

 
CA. AMARJIT CHOPRA
President, ICAI

Students appearing in the next Professional Competence Examination (PCE), Integrated Professional Competence Examination (IPCE) and Final Examinations of the Institute to be held from 8th November-2010 to 22nd November-2010 may kindly note that the Examination Timings are from 02.00 PM to 05.00 PM (IST)

Similarly, Examination timings at Abu Dhabi and Dubai Centres will be 12.30 PM to 3.30 PM. UAE local time equivalent to 02.00 PM to 05.00 PM (IST). Examination timings at Kathmandu centre will be 02.15 PM to 05.15 PM Nepal local time equivalent to 02.00 PM to 05.00 PM (IST)

Further to note that there will be no change in the examination schedule in the event of any day of the examination schedule being declared a Public Holiday by the Central Government or any State Government.

(G.Somasekhar)
Additional Secretary (Exams)

Enquiries are being received about possible change in the schedule of the Chartered Accountants examinations to be held from November 8th to 22nd, 2010 due to the forthcoming Elections to the Legislative Assembly in the State of Bihar.

It is clarified that the election schedule for Bihar Assembly Elections (as notified on 6th September, 2010 by the Election Commission of India) is not clashing the Chartered Accountants examinations scheduled in the State of Bihar. Accordingly there is no change in the schedule of the Chartered Accountants examinations to be held during 8th – 22nd November, 2010 from 2.00 PM to 5.00 PM (IST).

Further please note that there will be no change in the examination schedule in the event of any day of the examination schedule being declared a Public Holiday by the Central Government or any State Government.

ICAI has already entered into an arrangement with state-owned Corporation Bank, which will grant loans at liberal terms to small and medium firms, said an official with the regulator. “Similar arrangements could also be considered depending on the response we get,” he said, requesting anonymity. Indian audit firms face the threat of losing bulk of the lucrative consultancy work to competitors from Europe and China.

ICAI has also urged member firms to network among themselves and create larger entities through mergers and consolidations. Domestic firms are finding it difficult to scale up due to a paucity of funds. “Domestic firms should join hands for long-term prospects,” said Amarjit Chopra, president of ICAI. He further said there was a need to review the networking rules so as to encourage mergers.

The regulator has also asked member firms to look into emerging areas of consulting and assurance services rather than depending solely on audit assignments from banks. Noting that 74% of chartered accountants in the country are working as proprietors (working in an independent capacity) depending on annual bank audit, the ICAI president, in a recent communication to all its members, has asked them to get into collaborations to form larger firms capable of competing with MNCs.

In accordance with WTO norms, India allows transnational firms to be in the field of management consulting, even though these entities enter into informal tie-ups with domestic firms to do statutory audit work in India.
ICAI has over 1.5 lakh registered chartered accountants. They either work independently or are engaged by audit firms. Foreign firms having presence in India include US-based Deloitte Touche Tohmatsu, UK-based PriceWaterhouse-Coopers, Dutch firm KPMG and UK-based Ernst & Young –– together called as the Big 4.

The MNC firms have global networks and a large resource base, both in terms of infrastructure and manpower. Lately, India has also seen the emergence of a large domestic firms, although large chunk of the audit professional in India still works independently.

ICAI has conveyed to these multinational entities not to take over small audit firms, a move it feels will come as a hurdle to create a greater number of large domestic audit firms. With the country set to embrace International Financial Reporting Standards, a lot of back office consultancy work is being generated. The regulator wants that the Indian firms create the necessary infrastructure including resource base to earn revenue through consultancy job.

The ministry of corporate affairs, which is the administrative department for the audit regulator, has asked the institute to promote setting up of larger domestic firms under the limited liability partnership (LLP) route.

Accounting regulator ICAI has asked the Big Four auditing and consulting firms – KPMG, E&Y, Deloitte and PwC – to share any information sought by various committees of the institute and has asked them not to engage in “shopping for small firms”.

“There are a lot of issues in which the information is sought from various firms. But, though Indian firms are sharing the information, the Big Four have avoided doing the same. We understand the sensitive nature of a lot of the information sought. So, we have asked them to at least show us the documents and not necessarily submit them,” ICAI president Amarjit Chopra said.

The Institute of Chartered Accountants of India (ICAI) had a meeting with the Big Four recently where it said though it does not want these firms to share very confidential information because of its sensitive nature, “it has been conveyed in no uncertain terms that the information should be shown to the committees whenever called for,” sources said.

The Big Four, it is learnt, have said they will cooperate with the institute in future.

The meeting assumes importance as a High Powered Committee of the ICAI, entrusted with the task of preparing a report on surrogate practices of auditing by multinational firms, has completed its report and it will be taken up by the ICAI in the next council meeting.

“They are under the impression that we are after them. This is not the case,” he said, adding that there was agreement on most of the issues and the institute has been assured that it will enjoy the cooperation of the big four.

Chopra, in the meeting, also said these firms “are shopping for small but strong local auditing firms and this is not desirable”. “Let the Indian firms grow. You can do the hand holding but you should not be taking them over. That is not desirable. They (the Big Four) have agreed with us on this,” he added. Another issue taken up in the meeting was regarding the appointment of internal auditors. The president said wherever an audit committee has a member of these firms, he/she tries to pursue the interest of their respective parent firms while appointing internal auditors.

“Whenever your (Big Four) people are on the audit committee, they try to push their people as internal auditors. So how can you check the veracity of their work and how can you monitor the work? You can have statutory auditors and people on the audit committee but for an objective audit, the internal auditor should not be from the same group… the entire logic of monitoring fails if he is from the same group,” Chopra pointed.

Common Secretariat for Appellate Authority established under The Chartered Accountants Act, 1949, The Cost & Works Accountants Act, 1959 and The Company Secretaries Act, 1980

In terms of requirements of The Chartered Accountants Act, 1949, The Cost & Works Accountants Act, 1959 and The Company Secretaries Act, 1980, a common Secretariat for the Appellate Authority constituted by the Central Government has been established in the 4th Floor (Main Building) of ICAI Bhawan, The Institute of Chartered Accountants of India at Indraprastha Marg, New Delhi – 110002. This office would start functioning with effect from 13th September, 2010. The Officer Incharge for the office is Shri Bhaskar Bhardwaj, Dy. Secretary (Phone : 011-30110442) at the above address.

Any member of the respective institutes, aggrieved by any of the Orders of the Board of Discipline or the Disciplinary Committee of the respective institutes may, if he/she so desires, (in terms of the applicable provisions of the respect Acts) send his/her appeal to the above mentioned officer of the Authority (by name) by following the relevant provisions of the applicable Acts.

Renaming is not a simple exercise in the world of cost accountants. The parliamentary standing co­­m­mittee on finance headed by fo­rmer finance minister Yashwant Si­n­ha has rejected the demand of the Institute of Cost and Works Acco­untants of India (ICWAI) to rename it as Institute of Cost and Management Accountants of India (ICMAI).

In the report on the Cost and Works Accountants (Amendment) Bill 2010 submitted to Parliament last week, the panel has recommended that the institute be renamed as Institute of Cost Accountants of India (ICAI).

ICWAI president Brijmohan Sharma said that they would pursue their case with the corporate affairs ministry.

The committee in its report observed that the term ‘works’ attached to the profession and included in the institute’s name appears to mislead on the role and functions performed by cost and works accountants globally. And, their function cannot be defined in the act.

However, neither the term ‘management’ nor ‘cost and management accountant’ that are to replace the term ‘works’ in the institute’s name, are defined nor any concomitant changes been proposed in the act pertaining to the role and function of members of the institute.

‘Upon considering the matter, the committee is of the view that as proposed in the Companies Bill, 2009, it would be preferable to term the designation attached to the profession as ‘cost accountant’, and rename the institute as ‘Institute of Cost Accountants’.

The rival Institute of Chartered Accountants of India (ICAI) had opposed the change in name from ICWAI to ICMAI contending that management accounting is one area that is common to all (i.e., ICAI, ICSI & ICWAI) and not exclusive to any of the three professions. It is a position and not a function or discipline.

However, the corporate affairs ministry has supported change of name from ICWAI to ICMA. In a deposition before the panel, it said, “There are several countries such as Canada, the USA, the UK, Ban­gla­desh, Pakistan and Sri Lanka where a dual model of accounting institutes exist. In none of these countries confusion has been created by existence of two titles. Both CMAs and CAs coexist in harmony. The objections of ICAI to a change in name does not seem to carry conviction.”

Corporate affairs minister Sal­man Khurshid may table the bill in the budget session of Parliament.

As you are kindly aware that the Direct Taxes Code Bill, 2010 has been introduced in the Parliament on 30thAugust, 2010. The Direct Taxes Committee of ICAI requests you to kindly send your valuable suggestions on the same.

Kindly forward your valuable suggestions at dtc2010@icai.org

Announcement

With reference to the announcement dated 05.07.2010 in the cited subject, this is to inform that the Ministry of Corporate Affairs has decided to extend the registration process for a further period of 3 months from 1st September 2010.

The members can submit the registration form to the concerned branch of the Institute or at the following address till 15th November 2010. The postal order/ Banker’s Cheque/ DD should be made in favour of “The Secretary, ICAI”.

In respect of the other two schemes, namely, Easy Exit Schemes, 2010 and Company Law Settlement Scheme 2010, the Institute has requested for extension of time for availing of the two schemes.

Corporate Laws & Corporate Governance Committee
The Institute of Chartered Accountants of India
P.B. No. 7100, Indraprastha Marg,
New Delhi-110002
Contact No. 39893989 Extn. 461/471/561
Telefax 30110586
E-mail: clcgc@icai.org, corporatelaws@icai.org
website: www.icai.org

Let us recall when, about a year ago, the parents of Indian students studying in Australia were fear-stricken, as violence allegedly on the line of racial discrimination had been reported. Mass and media of our country had raised their voice against this violence. According to the UN, a ‘discrimination between human beings on the ground of race, colour or ethnic origin is an offence to human dignity and shall be condemned…as a violation of the human rights and fundamental freedoms… as a fact capable of disturbing peace and security among peoples.’ Our own Constitution in its Article 15(2) defines: ‘No citizen shall, on grounds only of religion, race, caste, sex, place of birth or any of them, be subject to any disability, liability, (or) restriction…’

Post-independence, for quite some years, the same ghost (of discrimination) has been haunting us in our own land. Soul of India lives in villages, it is said. Visit villages and we may discover: there is no concept of common wells, utensils or places of worship, to be used by all. We are generally more aware of the difference on grounds of religion/ caste and our socialisation with people of different religion/caste decreases. When it comes to family, such people are not a reality for us. Their inclusion in family is farther away from reality. This divide continues at workplace too. We are neither ready to acknowledge the presence of this divide nor strong enough to resist its presence. It is not acceptable that we still have divided opinions over such instances. Martin Luther King Jr., had expressed his concerns over this social difference and the value of togetherness: ‘We cannot walk alone…I have a dream that one day on the red hills of Georgia the sons of former slaves and the sons of former slaveowners will be able to sit down together at a table of brotherhood….I have a dream that my four children will one day live in a nation where they will not be judged by the color of their skin but by the content of their character.’ Unity is divine. India as a multicultural country presents us lots of challenges in the way of our unity, but history shows, we have always resisted such divisive sentiments through our conscience. It is time that we have to plunge deep into our conscience, find out the roots of such differences and remove their traces from it eventually.

People at the receiving end appear to be silent. We are silent too. Is it a careful silence on our part? Let us explore our responses. Let us be aware of the kind of future we will pass on to our generation next. Since the youth have an incessant energy, a heritage of divide and intolerance can create havoc in their life, which ultimately will affect the state of affairs in our country. We have to be responsible and vocal about voicing our opinions against it. We owe this to our generation next. We cannot evade our responsibility to our times. This is our social responsibility, probably a more important one, as it is more fundamental and capable of affecting our professional spheres too. Can we pledge to move towards this fundamental unity of mankind in our land?

Consolidating Professional Ties
Japan: Joint Initiative on IFRS

The undersigned along with the ICAI Vice-President CA. G. Ramaswamy and the ASB Chairman CA. Manoj Fadnis recently visited Japan as part of a high-profile delegation led by Shri R. Bandhyopadhyay, Secretary, Ministry of Corporate Affairs, Government of India, with an objective to share our perspective with the concerned Japanese constituent to provide a framework for experience sharing in the process of convergence to the IFRS. With India already committed to treading a path to IFRS convergence in a phased manner and Japan having started the thought process for mandatory application of IFRS to be determined around 2012, the coming together of these Asian economies assumes a great significance in the region. The visit witnessed the signing of a historic MoU between the Core Group on IFRS (constituted by the Ministry of Corporate Affairs, Government of India) and the IFRS Council, Japan. The undersigned signed the MoU representing India in the presence of the representation from Ministry of Corporate Affairs, Government of India, and other officials. During the occasion, the five subgroups on accountancy profession represented by undersigned and CA. G. Ramaswamy, Accounting Standards represented by CA. Manoj Fadnis, stock exchanges represented by Smt. Usha Narayanan, Executive Director, SEBI, regulatory issues represented by Shri Sunil Verma, Secretary, Audit Board, C&AG, Shri Jitesh Khosla, IICA, and representatives of PFRDA, IRDA and RBI, and industry represented by CA. T. V. Mohandas Pai, Infosys, met and exchanged their views. Apart from the undersigned and ASB Chairman, SEBI Chairman Mr. C. B. Bhave, Smt. Narayanan and Mr. Ravi Mohan from RBI also made presentations. Then, India-Japan Forum 2010 on issues related to implementation of IFRS was held. Sir David Tweedie, Chairman IASB, who was also present, addressed the occasion and expressed satisfaction over this dialogue and assured his support to this initiative. The event has a strong attendance of over 300 JICPA professionals and other professionals from Japanese industry.

Singapore: Towards Future Ties

At the advice of the Ministry of Commerce, Government of India, the ICAI delegation which included the undersigned and ICAI Secretary Shri T. Karthikeyana among others, visited Singapore to participate in the first round of the 2nd Review Meeting in the context of India-Singapore CECA. The meeting was attended by the officials of Ministry of Trade & Industry, Government of Singapore. The undersigned interacted with Dr. Ernest Kan, President, ICPAS, and with other ICPAS functionaries. We clarified them that we at the moment were not looking at the licensing rights and, therefore, would not provide the same to the ICPAS members. Further, it was decided that the two Institutes would share their wish list by mid-August. Wish List from ICPAS has already been received and it is being perused for further necessary actions. While we invited the ICPAS delegation for a visit, they in turn invited us to visit them this year to carry the matter forward. This intent was shared by both ICAI and ICPAS in the plenary session of the Review Meeting chaired together by Mr. Rahul Khullar, Secretary, Ministry of Commerce, Government of India and Mr. Ravi Menon, Permanent Secretary, Minister of Trade, Singapore. It has been proposed to hold an international conference jointly with the professional accounting bodies of Australia, New Zealand and Singapore in the last week of September in New Delhi.

Bangladesh: Attending SAFA Events

An ICAI delegation led by the undersigned that also included the ICAI Secretary Shri T. Karthikeyan and the Central Council members CA. Raj Kumar Adukia, CA. Sumantra Guha and CA. Pankaj Tyagee visited Bangladesh recently to attend the SAFA events. We actively participated and played a key role in taking the decision to a logical conclusion at the meetings of the SAFA Board and Assembly, and of various SAFA Committees. We also attended an international conference organised by the ICAB on Role of Chartered Accountants in the Mobilization of Natural Resources, which was inaugurated by Hon’ble President of the People’s Republic of Bangladesh Mr. Md. Zillur Rahman. It was attended by Nobel Laureate Prof. Muhammad Yunus, Managing Director, Grameen Bank, as special guest. Dr. Atiur Rahman, Governor of Bangladesh Bank, the central bank of the country, was also present in the conference. The Conference provided a platform for sharing knowledge among the participants and for formulating recommendations on effective mobilisation of domestic resources.

Status of Convergence with IFRS
Clearing Accounting Standards

As the members are aware, meeting the target of convergence with the IFRS has been one of the primary focus areas of our Institute. To meet this target, relentless efforts are being made. As far as formulation of IFRS-converged Accounting Standards is concerned, all Standards have been cleared by the Council of the ICAI except that on Insurance Contracts (corresponding to IFRS 4) in respect of which comments are awaited from the IRDA. Most of the Standards have also been cleared by the National Advisory Committee on Accounting Standards (NACAS). Expectedly, all Standards would be ready for notification by the Government soon. The exercise to converge with IFRS and not to adopt the same signifies that efforts are being made to formulate Accounting Standards which, as far as possible, should be in line with the corresponding IAS/IFRS keeping in view the Indian conditions and circumstances. Accordingly, few departures are also being contemplated. To be properly addressed at international level, Indian concerns are also being taken up with the IASB. We would like to thank Accounting Standards Board Chairman and Secretary CA. Manoj Fadnis and Dr. Avinash Chander, respectively, for their guidance and strategic contribution in the complete process behind this valuable conclusion.

IASB Outreach Programmes

Since, in future, we would formulate and revise the converged Accounting Standards in accordance with the IFRSs issued/revised from time to time, a formal procedure for sending comments on the consultative documents issued by the IASB has been finalised so that Indian concerns are appropriately raised. To familiarise our members, corporates and other stakeholders with consultative documents and to address their concerns, many IASB outreach programmes are being organised by the Institute. Recently, such Programmes were organised in Bangalore, Mumbai and Delhi, where IASB member CA. Prabhakar Kalavacherla and IASB Technical Manager Ms. April Pitman addressed on two IASB consultative documents on proposed IFRSs on Revenue and Leases and interacted with them to know the Indian concerns involved in those documents. One of such programmes held in Mumbai was attended by the NACAS Chairman CA. Y. H. Malegam also, who expressed reservations against accounting treatments suggested by IFRS in respect of Revenue Recognition and Leases.

XBRL Progress: Towards International Status

We want to inform our members that ICAI had taken an initiative to promote XBRL (eXtensible Business Reporting Language) in the country. XBRL is a novel method of electronic communication of business/financial data and an immense utility to capital markets and investing community. It is revolutionising the world business reporting while changing only the way of reporting. ICAI was granted a Provisional Jurisdiction of XBRL International Inc. (XII) in December 2008. During its tenure, XBRL India Jurisdiction has developed two taxonomies, General Purpose Financial Reporting XBRL Taxonomy for Commercial and Industrial Companies and Banking Taxonomy, which have been acknowledged by the XII. At present, the process of establishing taxonomies for NBFCs has been initiated. These taxonomies act as ‘dictionaries’ which are computer readable financial terms. The Jurisdiction is now in the process of opening up membership, for which a Section 25 company is being incorporated. After the incorporation, the Jurisdiction would apply to XII for becoming an Established Jurisdiction, which would enable India for voting at International Steering Committee (ISC) of the XII.

ICAI Recommends Amendments to CA Act, 1949

Our Council, at its 294th meeting held in March 2010 had constituted a Group on Amendments in the Chartered Accountants Act, 1949, under the Convenorship of the Vice-President of the Institute, CA. G. Ramaswamy, and asked it to suggest draft amendments in the Act arising out of the Report of the High-Powered Committee as submitted to the Central Government so as to amend the Act to take disciplinary action against erring CA firms also. On the recommedations submitted in June 2010 by the Group, the Council requested back the Group to reconsider in the light of suggestions made by its members. The Group resubmitted its revised recommendations to the Council in August 2010 and now it will again consider the amendments in light of the suggestions made by the Council members. Then, this will be forwarded to the Central Government for consideration and incorporation. The major purpose of making various amendments to the Act is to make disciplinary process speedier and more timebound, and to demonstrate to society for upholding the highest conduct of the professionals. Some of the amendments include the determination of prima-facie cases not to be handled by Director (Discipline) alone but rather by a Committee, action against CA firms, etc. Moreover, the action against the firm shall be covered by both Schedules to the Act involving not only financial penalty but also suspension thereof. However, the action against the firm is proposed to be taken by the Council only.

Capacity Building Measure: Meeting CA Firms

To adhere with the spirit of professional development, the Committee for Capacity Building of CA Firms and Small & Medium Practitioners organized in Mumbai and New Delhi meetings and brainstorming sessions for the partners of CA firm, where we interacted with the partners of CA firms and got wonderful suggestions.

As a matter of fact, 74 per cent of the profession is comprised of proprietors and, even after 61 years of the profession, most of the members still wait for a bank audit assignment as their major work sphere. It is high time that we come up and create world-class CA firms. We can’t ignore the likely challenge from China. We must be able to foresee the changing scenario in our profession and prepare accordingly. We need to encourage our firms to grow bigger with their multidimensional professional expertise. Networking and merger of the firms should be for real capacity building and, in no way, be limited to audit empanelment. We are aware that some of the arrangements or procedures laid down in the networking rules need to be reconsidered and reviewed afresh so as to encourage networking and merger. Name, place and seniority of the professionals and their firms should not be major concern in consolidations and mergers. Perspective and mindset towards consolidation needs to be changed. Firms should join hands for long-term prospects and the right parameter to measure the consolidation and merger of firms would gain in terms of increase in competencies and annual turnover. Here, we would like to appreciate the concerns of our members in profession who wish to set up their practice and face lot of challenges in the process. We are happy to inform that we have entered into an agreement with the Corporation Bank, which will grant loan on liberal terms. The details of the scheme will be announced shortly.

Planning Vision Document

It is quite satisfying to inform that we have already concluded 19 interactive workshop across the country in order to include the voice and vision of key resourceful people from varied stakeholder sections of the profession in our vision document, and we still plan to host a few more of such exercises in remaining key areas. Members across the strata have expressed their concerns that the Institute should become a major global player by reorienting its strategy in education system including examination reforms so as to produce socially-relevant chartered accountants. However, there were concerns expressed by some stakeholders with regard to realignment of the profession deliverables. We ensure all our stakeholders who have contributed to the process that their valued inputs given towards creating an inspiring vision for the profession will be given due consideration. To ensure members’ active participation, we have hosted a web-form on the agenda of the vision exercise on our website (available till September 15, 2010). We urge our members to become a part of this grand exercise and ensure that their feedback is recorded with us.

Rajya Sabha Deputy Chairman Releases Booklet on Accounting Reforms

Shri K Rahman Khan, Hon’ble Deputy Chairman, Rajya Sabha recently released the booklet, Accounting Reforms in India-A Bird’s Eye View, prepared by the Committee on Public Finance & Government Accounting of the Institute. This booklet covers the achievements of accounting reforms, roadblock in the way for accounting reforms, needs to harmonize accounting standards, conversion from cash to accrual system and single to double entry book-keeping, implementation of accrual accounting in Government, and other related issues. While stressing a need to converge from single- to double-entry accounting system, Shri Khan appreciated our efforts in bringing out this booklet on Accounting Reforms in India. Having regard to the huge social and developmental expenditure of the Govt. of India on NREGA (now called Mahatma Gandhi Rojgar Yojna), he called upon the profession to conduct in-depth audit to serve the public interest more effectively.

Dr Parthasarathy Shome at ICAI Council Meeting

Dr. Parthasarathy Shome, Chief Economist in the Her Majesty’s Revenue and Customs (the British tax office) and ex-Advisor to the former Finance Minister of the country, came to the Institute at the 297th meeting of the Council held on 5th August, 2010. It was a matter of pride and privilege to have the august presence of one of the top economists at the Council meeting of the Institute and we must thank our Council Colleague Ms. Bhavna J. Doshi for taking the initiative for organising his visit. Dr. Som recalled that, as an advisor to the Finance Minister Mr. P. Chidambaram, he always suggested him to get chartered accountants from the national institute to look through what they were through. He admitted that he revered the accountancy profession.

Foundation Stone at Jodhpur: Seminar on Accounting and Taxation

The undersigned visited the newly acquired land site and laid the foundation stone of the Jodhpur Branch of ICAI. The senior-most member of the Jodhpur Branch and first gold-medallist of the Institute, CA. Ajeet Singh S. Bhandari was also honoured.

A seminar on Accounting and Taxation was organised for the members that was followed by a successfully-held, i.e. strong attendance of over 350, students’ seminar at Jodhpur. The undersigned was the Chief Guest for the programme. CA. Sunil Goyal, Past President, ICAI, CA Kemisha Soni, Chairperson-CIRC, and CA. Rajendra Kumar Saraf, Chairman- Jodhpur Branch were also present on the occasion. We apprised the members about the proposed plan of the Institute for increasing the membership fees, biometric verification in the CPE seminars, increase in contribution to the benevolent funds, etc. We asked our members to look at the infrastructure from a long-term perspective. With regard to our students’ initiative, we conveyed that various new measures like uploading of the training record by articled assistant, updation of study materials of IPCC course, commencement of the virtual classrooms by November 2010, etc., are in the pipeline. We also stressed our concerns for the students’ motivation for studying on continuing basis with seriousness.

Conference on Audit and Financial Reporting in Udaipur

Two-day conference on Excellence in Audit and Financial Reporting was organised by the Udaipur Branch of CIRC. Out of many presentations of papers and overviews, some of the notable ones were by our Central Council colleagues CA. Jaydeep N. Shah, Chairman, Financial Reporting Review Board, and CA. Abhijit Bandyopadhyay, Chairman, AASB, which were appreciated a lot for their deep insight and value-contribution. CA. Shah presented Common Discrepancies in Financial Statements Including Audit Reports in the conference, where he apprised the participants about the common non-compliances observed by the Financial Reporting Review Board (FRRB) during the review of generalpurpose financial statements. CA. Bandyopadhyay presented Overview of Standards in Auditing and Best Practices in Audit Reporting.

Training for Members for ICAEW Membership

In 2008, the ICAI had signed a historic MoU with the Institute of Chartered Accountants England and Wales (ICAEW), which allows our members having two-year post-qualification experience to obtain the ICAEW membership on passing the ICAEW’s final advanced-level paper Advanced Case Study – a 4-hour final paper that aims to test candidates’ professional skills in the context of business issues, building on technical skills and learning outcomes. We are happy to inform our members that we are now offering training for that course in our country exclusively through accredited training providers and publishers, Get Through Guides (GTG). GTG and ICAI have jointly designed a 10-day training programme, to be facilitated by faculty from England, for the purpose.

Convocations: Consolidating Members’ Belongingness

We would like to inform that a convocation ceremony of our Institute is intended to bring the young members of the profession under the umbrella of chartered accountant fraternity and to consolidate their belongingness to the Institute. The conferment at a convocation ceremony goes a long way in the milestones of the chartered accountants concerned as they cherish this occasion forever in their life. Convocations for the northern region were successfully held in New Delhi and Ludhiana, where more than 120 members attended the function along with their family members. Convocation for the eastern region was held in Kolkata and more than 200 members attended the function along with their family members. Convocations for the southern region were held in Bangalore and Chennai where more than 120 members and 250 members, respectively, attended the function along with their family members. Suresh C. Senapaty, Exec. Director & CFO, Wipro, and Col. (Dr.) G. Thiruvasagam, Vice- Chancellor, University of Madras, were the chief guest in the Bangalore and the Chennai ceremonies respectively.

Disciplinary Cases Concluded

Since the Council has expressed its serious concerns over the speedy conclusion of the disciplinary cases going on in the Institute, the Disciplinary Committee has followed the Council’s disposition in the right spirit and has cleared many cases since February 2010: Disciplinary Committee – 60 cases under Section 21D and 20 cases under Section 21B; Board of Discipline – 34 cases under Section 21A; and old Disciplinary 10 cases.

Students’ Matters
Revision of Stipend

We are really happy to inform our students that the Council at its recent meeting, keeping in view the prevailing inflation rate, felt a need for revising the existing stipend of articled assistants and decided to double it from its existing value. Accordingly, in order to implement the same, the relevant draft amendments in the Chartered Accountants Regulations, 1988 would be sent to the Central Government for approval, as the same would come into force after its approval:

PEE-II, PCE and IPCE Results

The ICAI recently announced the results of the examinations of PE II, PCE and IPCE held in May, 2010 on August 4, 2010. The pass percentages (both Groups) were 1.95, 13.5 and 12.28 in PE II, PCE and IPCE examinations respectively.

Female Candidates Excel: There are two candidates at all-India first rank in the Professional Competence Examinations (PCE) held in May 2010 with 77.67 per cent marks and both of them are female students. Even the second-rank holder is a female student with 76.33 per cent marks. The two of the first three toppers, second and third, of the IPCE (Integrated Professional Competence Examination) held in May 2010 are again female students. The second topper with 76.00 per cent marks is very close to the first, i.e. 76.14 per cent. The pass percentage of female student in all examinations but in PE-II, is better than their male counterparts.

Region-wise Performance: The percentage of students passed in PCE as well as in IPCE of the EIRC region was the best one among all regions, i.e. with 20.05 and 16.73 per cent respectively, while the WIRC was trailing behind on the second position with 13.71 per cent in the PCE and, surprisingly, the overseas was the second best in IPCE with 13. 64 per cent. CIRC was a close third, i.e. 13.29 per cent, in the PCE and WIRC got third rank with 12.84 per cent in the IPCE.

Decisions for PE-II and PCC Students

We are happy to inform our student community that the Council has considered the case of PE-II students especially in order to mitigate their hardship vis-à-vis their joining the CA course through PCC/IPCC route. PEII students having joined the course through all streams can now commence articled training in case they have passed any of the groups of PE-II examination instead of earlier requirement of passing both the groups. They will also be eligible to appear in the Final Examination during the last 12 months of articled training. In addition, such students shall be exempted from undergoing the Orientation Programme, on switching over to IPC course. Further, they shall not be charged any fee for switching over to IPC course, except Rs. 1,500 to cover the cost of study material and administrative charges, instead of Rs.4,000 at present.

With a view to bring overall uniformity, students registered for Professional Competency Course (PCC) shall now be eligible to appear in the Final Examination during the last six months of the three and a half year period of articled training as against the earlier requirement of appearing in the Final Examination after completion of articled training. Further realising the difficulties faced by the students to complete the Information Technology Training (ITT) and Orientation Programme before appearing at the examination, it has been decided that all students would now be permitted to submit proof of their successful completion of ITT to the Examination Section before the commencement of the article training, instead of earlier requirement of submitting the said proof before appearing in the examination. However, this would not be applicable to the PCC students. However, it has been observed that many students are withdrawing their registration from ITT centres and they wish to complete the ITT and Orientation Programme before the commencement of the article training. In our opinion, all such students are advised to undergo ITT and Orientation Programme as early as possible, because this wouldn’t only help them in solving the questions posed in examinations in the IT paper but also release the pressure on the training centres.

We have also decided that students with a permanent disability of 50 per cent or more and fulfilling the prescribed guidelines shall be exempted from the payment of fees for undergoing Orientation Programme and they shall neither be required to attend the course nor to pass the special test of three hours.

We organised a joint meeting of the Examination Committee and faculty of the Board of Studies, wherein certain student-friendly decisions were taken. It was decided to host the suggested answers to the questions set in examinations within 25–30 days of the respective examinations. Further, it was decided that the study material should be made more application-oriented and case studies be included in various subjects like Accounting and Strategic Manegement. Steps are also being taken to present a more responsive and transparent examination system in students’ interests.

We would like to thank the Council – particularly ICAI Secretary Shri T. Karthikeayn, Board of Studies Chairman CA. Vinod Jain and Board of Studies Director Shri Vijay Kapur – for playing a strategic role in the preparation and execution of the above-said decisions.

This is also to inform that we are planning to propose a mega international conference in the third week of January 2011 in New Delhi. Exact dates will be announced later. We appeal to our professional fraternity to join in large number and make this a successful event.

Let us recall what the Corporate Affairs Minister Shri Salman Khurshid had said on July 1 this year: Bring a change in your policy and bring at least 33 per cent women power before a lady joins in my position. Although uttered in humour, we cannot ignore its underlying serious implications on our profession and society. The truth cannot be kept aside. First educator of our family has to be an educated and empowered person. It is quite desirable that women running their homes and managing their accounts for ages must get a respectable share in the profession. Gender equality is a serious concern – both before profession and society. A better show of the female candidates in the examinations of PE II, PCE and IPCE held in 2010 is a sign of good hope in this direction. We appreciate this leap towards equality and sincerely wish the community success in its true and justified endeavours. Change in tradition, if constructive and positive, is never a distortion, and we should always welcome such a change.

Weather, a symbol of change, is a justified metaphor for life too. Weather may be good or bad and nothing much could be done about this. Nowadays, it is raining day and night cats and dogs in the capital. American poet and columnist J. M. L. Hughes says: Let the rain beat upon your head with silver liquid drops. Let the rain sing you a lullaby. We would like to wish everybody a happy rainy season with sound health.

Best Wishes

Yours sincerely,

CA. AMARJIT CHOPRA
President, ICAI

In a move to facilitate the students, the Board of Studies has compiled the comments of the examiners on all the subjects of the Final (Old) Course and Final (New) Course examinations held in May, 2010. The group-wise general comments of the examiners on the performance of the students have been summarised, which are followed by the question-wise specific comments on the mistakes committed by the students in different subjects.

Students are advised to go through the general and specific comments very carefully to be aware of the areas in which they are lacking, the mistakes committed, etc. which would help them to overcome their shortcomings in the forthcoming examinations.

The summary of examiners’ comments on the performance of candidates is available at http://www.icai.org/post.html?post_id=6284

Suggestions / views invited from all members with regard to the changes / modifications required in the Code of Ethics, 2009 in view of the revised edition of IFAC Code of Ethics (2010)

Candidates who have tried to submit the online Examination Application for the forthcoming for Chartered Accountants Examinations, November 2010 and whose online payment through Credit Card / Debit Card / Netbanking has been effected but online PDF Format could not be generated, are advised to purchase a physical application form, complete the details required and send the same along with the physical proof for the online payment (which has not been reversed):

Such a physical proof for the online payment (which has not been reversed) will be treated as examination fee paid through Bank’s Payorder / Demand Draft provided required proof (such as credit / debit card statement or netbanking statement containing the relevant entry of online payment) are submitted along with the OMR form and Form B

It may be specifically noted that this arrangement is made to avoid further anxiety / inconvenience to the students aspiring to appear for the November 2010 CA Examinations.

For more than one payment loss, the students can claim refunds for extra payments which are not linked to the physical application forms. Such refund requests – alongwith the said payment proofs and mentioning the OMR form’s barcode with the transaction ID linked with that OMR and Form B – should be sent to The Additional Secretary (Exams), The Institute of Chartered Accountants of India, ‘ICAI Bhawan’, Indraprastha Bhawan, New Delhi – 110 002

Examination Department

Speaking to presspersons on the sidelines of the inauguration of the national conference on ‘Direct taxes and allied laws’, organised by the Direct Taxes Committee of ICAI here on Friday, he said the next financial year will be a great year for the country.

The professionals will be geared up for the implementation part, and the corporates on the compliance part. This will lead to increase in the revenue collection also, he said. Stating that a lot of developments are taking place with regard to the implementation of IFRS, Mr Ramaswamy said that the ICAI is gearing up its members and industry towards the achievement of the committed date of April 1, 2011. The IFRS will be implemented in a phased manner from 2011-14.

“We are conducting national workshops and meetings throughout the country creating awareness, involving professionals and those who are interested in it. Special e-learning courses and certificate courses are available for chartered accountants,” he said.

The ICAI also has mutual recognition arrangements with accounting bodies in England and Wales and Australia. “We are also in dialogue with Canada, Singapore, Malaysia and New Zealand institutes. We are coordinating with them,” he said. On the Direct Taxes Code (DTC), he said that for the first time, a proposed legislation was open for debate throughout the country. Tax payers, academicians and chartered accountants have given their views. Stating that the final version will be tabled in Parliament, he said the deadline for DTC implementation is April 2011.

He said the Central Council of ICAI has proposed an amendment on the type of action to be taken in the case a firm is involved in cases of violation. “The Central Council has debated on that. We are proposing an amendment. So we are giving suggestions to the Government,” he said.

NETWORKING

On the networking of CAs, he said today, 70 per cent of chartered accountants are small and medium practitioners. If the Chartered Accountants (Amendment) Bill 2010 is passed in Parliament, more number of CAs can come together and form an LLP (limited liability partnership) firm. Apart from CAs, these firms can include cost accountants, advocates, valuers, actuaries, and may be MBAs (finance).

END USE AUDIT

An LLP firm can give a host of service, he said, adding that LLPs will be one of the important mediums for the CA firms.

Mr Ramaswamy said that ICAI is already interacting with the Comptroller & Auditor General for end use audit.

Giving the example of National Rural Employment Scheme (NREGS), he said it is being implemented throughout the country through State Governments. So, there should be checks and balances.

“We have already made representation to the Comptroller & Auditor General that NREGS should be audited by the CAs. That will help small and medium practitioners also. It can be monitored throughout the country by CAs. With this, end user can be identified properly,” he said.

Stating that the Comptroller & Auditor General is very positive on this, he said, “They have collected information about the CAs available throughout the country. We have given district-wise data. We are pursuing them to make it mandatory.”

Accounting profession watchdog Institute of Chartered Accountants of India (ICAI) will seek an amendment to the Chartered Accountants Act to expand its regulatory powers to cover audit firms.

Currently, the institute has powers to regulate only its members - chartered accountants - but does not have a specific mandate under law to oversee audit firms operating in the country.

The move comes on the heels of the Bombay High Court’s August 13 ruling that the Securities & Exchange Board of India (Sebi) could proceed with its enquiry into audit firm PriceWaterhouse for its alleged role in the Satyam scam.

The High Court had observed that Sebi has the power to act in the interests of shareholders of listed companies. However, it noted that actions against professionals (chartered accountant, in this case) could be taken only by the body that regulates that profession. The court observation triggered a debate on whether Sebi could bar PriceWaterhouse from working with listed companies, if proven guilty.

ICAI is attempting to arm itself with powers to monitor and, if necessary, wield regulatory powers over audit firms right from the time of registration. The ICAI council, the apex decision-making body, is expected to finalise the institute’s recommendations. Once finalised, the proposal will be submitted to the Ministry of Corporate Affairs.

The institute had suggested the need to strengthen its powers to regulate audit firms in its report on the Satyam accounting fraud submitted to the ministry few months ago. Currently, the disciplinary committee of ICAI holds individual chartered accountants responsible for any malpractices or discrepancies that occur during an audit. ICAI has powers to suspend the registration of such persons if found guilty. However, the institute has no power to take similar action against erring audit firms.

Requirement to mention the firm registration number allotted by ICAI in all reports issued, including certificates, by members of the ICAI

Attention of the members is invited to the announcement regarding requirement relating to mentioning the firm registration number in the audit reports and resolution passed by the company for appointment of statutory auditors, published on page 1312 of the February 2010 issue of the Journal.

The Council of the Institute of Chartered Accountants of India, in terms of the decision taken at the 296th meeting held in June 2010 has decided to extend the requirement to mention the firm registration number to all reports issued pursuant to any attestation engagement, including certificates, issued by the members as proprietor of/ partner in the said firm. The requirement shall apply where such firm registration number has been allotted by the Institute of Chartered Accountants of India.

The Council further decided to make this requirement effective for all attestation reports/ certificates issued on or after 1st October, 2010.

Sub: Eligibility criteria applicable to different streams students for appearing in the Final Examination to be held in November, 2010 examination and onwards

Having regard to the hardship faced by the students of Final examination, the Council has decided to modify eligibility criteria applicable to different stream of students for appearing in the Final Examination to be held in November, 2010 examination and onwards. Accordingly, PE-II students who shifted to PCC or to PCC and then to IPCC or to IPCC shall be allowed to take the Final examination during the last 12 months of their prescribed period of articled training. Students, who remained in PE-II stream and passed examination will continue to undergo 3 years articled training and will be eligible to appear in the Final examination during the last 12 months of their articled training. The Council has also decided to allow PCC students to appear in the Final examination during the last 6 months of their articled training period. In respect of IPCC students, the Council clarified that they can appear in the Final examination as per the existing criteria, i.e., during the last 6 months of their articled training period of 3 years.

Detailed eligibility criteria for different streams to appear in Final examination are as follows: 

The above eligibility criteria is applicable for November, 2010 examination and onwards.

Director, Board of Studies

The annual Membership and Certificate of Practice fees (if member holds certificate of practice) became due and payable on 1st April, 2010. Circulars advising members to pay the membership/certificate of practice fee were sent to individual members in the month of April, 2010 and published in May, 2010 issue of the Journal.

Attention of all those members who have still not paid the annual membership fee/certificate of practice fee by 31st July, 2010 is invited to pay the fees immediately so as to reach the concerned Regional Office before 30th September, 2010.

The non-payment of annual membership/certificate of practice fee will have the following consequences:

i)   The member will not be eligible to use designatory letters ‘CA.’ as a prefix to the name and ‘ACA’/’FCA’ and designation ‘Chartered Accountant’.

ii)   A member in practice will cease his right to practise as a Chartered Accountant.

iii)   Such a member will not be eligible to train articled/audit assistant already receiving training under him.

iv)   The member will not be eligible to train any new articled/audit assistant.

v)   Such a member will not be eligible to carry out audit/certificate/attest and other functions in view of (i) & (ii) above.

Members can also pay membership/COP fees by using the online facility available on the website. For the use of payment gateway, members are requested to log in through “Online Services” link available on home page of the Institute’s website.

From this year onwards, the scheme of advance amount remittance has been introduced in place of advance payment of fee and the same can be referred in the Fee circular sent to all members.

For, any other clarification, members are advised to contact the concerned Decentralized Offices of the Region.

Please pay your membership fee and avoid unwanted removal of your name.