Let me start my message with the words of a Gandhian Nobel Peace Laureate, Martin Luther King, Jr.: Let us not wallow in the valley of despair, I say to you today, my friends. And so even though we face the difficulties of today and tomorrow, I still have a dreamI have a dream that one day this nation will rise up and live out the true meaning of its creed: We hold these truths to be self-evident, that all men are created equal. I have a dream that one daythe sons of former slaves and the sons of former slave owners will be able to sit down together at the table of brotherhood. I have a dream that one day evena state sweltering with the heat of injustice, sweltering with the heat of oppression, will be transformed into an oasis of freedom and justice. Equality of mankind-in terms of religion, race or sex-is the most fundamental premise of all change and development. I believe in it and I would recommend all to believe in it. Believe me, the change and development so achieved will be sustainable.
Now, let me take this opportunity to inform that our Institute and profession have touched new heights and reached some of the unfathomed corners of Building blocks of the profession are being consolidated and empowered. We are assisting the Government in streamlining their accounting procedures and responding actively to their requests and suggestions to satisfaction. The Chartered Accountants Act, 1949 is being revised to suit the needs of the hour. Our initiative to grow awareness about accountancy has not only helped the profession domestically by increasing number of students opting for CA education, but internationally too by creating space for Indian academics and professionals from the field of accountancy. New buildings are getting ready to house the ever-increasing actions for associates and fellows of the profession.
We are reaching our international stakeholders with our expertise in accounting and our strong conviction to help the industry in resolving the riddles of accountancy ethically. New Branches and overseas Chapters are being opened. New tie-ups in form of MRAs and MoUs are being formed. There have always been solid reasons why various world accounting associations like IFAC and IASB acknowledge our active role and contributions for the cause of profession. We are constantly creating new platforms and voicing our concerns for the profession at all possible and existing international forums of accountancy. Organising international conferences for members, academics, students and other related professionals is not only our effort to lodge our active presence but also to help and consolidate our profession globally. We are converging our accounting standards to bring ourselves on an international footing without losing our identity, as we fully understand our people and society, and their needs. We are really working hard to advance the cause of profession globally towards creation of a true international accounting fraternity. We are sure we will always have a bigger share in that fraternity. Therefore, we have decided and acted upon to converge our accounting standards with the IFRSs instead of changing ourselves and writing new codes of standards. We are playing a crucial role in this process of convergence in our nation by issuing the converged Standards efficiently.
It is a fact that our Institute and our profession have recorded a huge progress since its inception and, in fact, we have come far far ahead since then. Some of the significant achievements and decisions of the Institute regarding the profession in this Council year (2010-11) have been listed immediately after this message for your information. Meanwhile, let us look at some of the recent significant developments and opportunities created for the profession in particular and for our nation in general:
Shri Murli Deora Our New Corporate Affairs Minister
We are happy to learn that Shri Murli Deora, a politician of long standing and senior Minister in the present Cabinet serving as Petroleum & Natural Gas Minister for the second time, has joined the Ministry of Corporate Affairs as Cabinet Minister succeeding Shri Salman Khurshid. Under his leadership, we wish, the Ministry of Corporate Affairs to usher in a new era of change, development and growth. We take this opportunity to congratulate and welcome Shri Deora for this appointment. We sincerely hope and are sure that his able leadership will create new pages in the development of corporate governance. We assure him to continue with our complete and dedicated cooperation, support and assistance, which we were extending to the outgoing Minster of Corporate Affairs Shri Salman Khurshid.
In fact, this is also time to express our gratitude and appreciations to Shri Khurshid for all his help, support and encouragement in the initiatives of our Institute in the best interests of the accountancy profession and fraternity. We will always be grateful to him for this.
International Conference on Accountancy Profession: We are glad to inform that International Conference on Accountancy Profession: Catalyst to Sustained Economic Growth was successfully held with more than 1,100 participants at Vigyan Bhawan in New Delhi. Chief Guest Honble Union Minister of Finance Shri Pranab Mukherjee inaugurated the Conference. He also released six of our publications on the occasion. The then Honble Minister of Corporate Affairs, Shri Salman Khurshid and Honble Deputy Chairman, Rajya Sabha, Shri K. Rahman Khan graced the inaugural session as Guests of Honour, and Secretary of Ministry of Corporate Affairs Shri R. Bandyopadhyay was the Special Guest. An MoU with the Higher Colleges of Technology, UAE, was signed during the Conference. Shri Khurshid distributed the ICAI Awards for Excellence in Financial Reporting to the awardees for the year 2010. Eminent national and international experts from the field of accountancy addressed various sessions, which include C&AG of India Shri Vinod Rai, Planning Commission Member Shri Arun Maira, Controller General of India Shri C. R. Sundaramurti, NACAS Chairman CA. Y. H. Malegam, Financial Commissioner (Railways) Shri Samar Jha, IFAC CEO Mr. Ian Ball, IASB Vice-Chairman-Elect Mr. Ian Mackintosh, IAASB, Deputy Chair Ms. Diana Hillier, CPA Australia CEO Mr. Alex Malley, ICAA CEO Mr. Graham Meyer, SAFA immediate-past- President Shri Komal C. Chitracar, ICAP President Shaikh Saqib Masood and ICAWEW Vice-President Mr. Mark Spofforth. A cultural programme was organised at Siri Fort Auditorium for the dignitary delegates. On the last day, a joint Declaration was signed with Association of International Accountants, UK, which bestowed the undersigned with its honorary membership. To keep participants abreast of sessions during the Conference, a Daily Chronicle was published on all days covering the events and deliberations of the day. The details of the Conference are published elsewhere in this Journal.
International Conference for CA Students: It is a matter of pride to acknowledge that, for the first time in the history of the Institute, International Conference of CA Students was organised on Indian Accountancy Profession Marching Towards Global Centre Stage at Shri Ram College of Commerce (SRCC), University of Delhi. More than 1,000 Students from India as well as from Nepal attended the Conference, which was inaugurated by the Honble Vice-Chancellor of University of Delhi Prof. Dinesh Singh. The undersigned also addressed the students on this occasion. Central Council colleague CA. Vinod Jain and Chairman, Board of Studies, NIRC Chairman CA. Atul Kumar Gupta and SRCC Principal Dr. P. C. Jain also addressed the Conference. Papers were presented by students on topics covering GST, IFRS, Forensic Accounting, Capital Market, Role of CFO, LLP, etc.
Bilateral Relations with University of Djibouti: We are happy to inform that the undersigned along with ICAI Vice- President CA. G Ramaswamy and ICAI Additional Secretary Shri Rakesh Sehgal recently visited Djibouti, where a statement of Bilateral Cooperation was entered into between ICAI and University of Djibouti, Republic of Djibouti. A department of accountancy to be operational from September 2011 would be set up in the University. A midtier certification programme on the lines of Accounting Technician Programme would also be offered. Appropriate framework for establishment of a chartered accountancy programme will also be presented at Djibouti. The successful execution of Djibouti Pilot Project would provide a springboard to us to catapult our efforts in the African countries more vigorously.
Representations and Meetings with Government Bodies
Report to Parliamentary Standing Committee on Finance: We wish to inform that final consolidated report of ICAI on the Direct Taxes Code Bill, 2010 has been submitted recently to the Parliamentary Standing Committee on Finance, which has also desired to have a hearing of ICAI representatives later on the Bill. The undersigned and ICAI Vice-President CA. G. Ramaswamy along with Central Council colleagues CA. Jayant Gokhale and CA. M. Devaraja Reddy, and Secretary to Direct Taxes Committee of ICAI CA. Mukta K. Verma were nominated to represent the Institute for the same. Responding to request of oral hearing of ICAI representatives on the Bill, CA. Ramaswamy, and CA. Gokhale along with CA. Verma appeared before the Parliamentary Committee and presented the ICAI views on the Bill.
Meeting HRD Minister Shri Kapil Sibal: We wish to inform our readers that the undersigned along with ICAI Vice-President CA. G. Ramaswamy and Director Shri Vijay Kapur met Shri Kapil Sibal, Honble Minister for Human Resource Development, Government of India. Shri Sibal has appreciated and shared our concern on selection of L1 bidders for audit assignment being tendered for Sarva Shiksha Abhiyan in various States and agreed to look into the matter to ensure that audit fee is fixed on the basis of scope of work. Further, it was decided to form a group of experts to look into applicability of accounting standards and to modify the same, if required to make them applicable to all educational institutions so as to ensure more accountability and transparency in the system. We hope that necessary actions in this regard will follow soon.
Deferment of Implementation of Empanelment Policy: We wish to inform our members that a request has been made to the office of the Comptroller and Auditor General of India to defer the implementation of new policy of empanelment of CA firms and selection of auditors for publicsector units for next year, so that there is sufficient time to notify the same to all concerned. The decision taken by the C&AG will be in the long-term interests of the profession.
Representation to CBDT: We wish to let our stakeholders know that we have made a representation to CBDT requesting them to issue an appropriate clarification so that approvals granted by the Development Commissioners shall be considered as sufficient compliance for allowing deduction under section 10B of the Income-tax Act, 1961. Actually CBDT had issued an instruction that an approval granted by Development Commissioner shall be considered as valid once such an approval is ratified by the BoA for Export Oriented Undertaking Scheme. However, during the course of income tax assessments, the Assessing Officers (AO) were taking a view that the approval granted by Development Commissioners is not equivalent to the approval given by BoA as required by provisions of section 10B of the Act. We hope to get this clarity soon in the interests of the profession.
Association with Telecom Ministry: We are pleased to inform that Ministry of Telecommunications has shown interest in associating itself in the formulation of Technical Guide on Revenue Recognition for Telecommunication Operators. Meanwhile we have included suggestions received from TRAI and MTNL on the Exposure Draft of the proposed Technical Guide and, as such, the finalisation is deferred for obvious reasons.
Assistance to National Academy of Direct Taxes: Realising our responsibility, we have proposed to National Academy of Direct Taxes (NADT), Nagpur, to have an ongoing programme of collaboration in view of an in-principle agreement that such an approach would be helpful in improving tax administration in the country. NADT had proposed to organise lectures for 63rd batch of IRS probationers on topics like Accounting Standards, Direct Taxes Code, etc., seeking our assistance. We will hold the programme for them soon.
Assistance to National Judicial Academy: It is a matter of pride to inform that since National Judicial Academy had requested us to organise a twoday capsulated introductory course on how concepts of taxable income are impacted by application of mandatory Accounting Standards for the judges of High Courts, we have written back to them proposing to organise training programmes for sitting judges of the High Court.
Recommendations on Dr. Bimal Jalan Committees Report: It is satisfying for us that the recommendations/suggestions on Report on Review of Ownership and Governance of Market Infrastructure Institutions (MIIs) of Dr. Bimal Jalans Committee constituted by SEBI has been complied and submitted to SEBI for consideration. To ensure good governance practices, we have proposed a representation of trading members, nominees of Government, CII, FICCI and Assocham on the Board of Stock Exchanges besides agreeing to other major recommendations made by the committee. The detailed comments, as submitted to SEBI, are published elsewhere in the journal for your information and feedback.
Group Formed to Assist GASAB: It is assuring for us that GASAB, constituted by C&AG, has sought our assistance in formulation of some of Indian Governmental Financial Reporting Standards (IGFRSs) to accelerate the process of formulation of Standards for the Government. We have constituted a study group to formulate IGFRS corresponding to IPSAS 1 and 2 for GASAB.
Meeting on Data on Trade in Services: We wish to inform our stakeholders that the undersigned along with ICAI Addl. Secretary Shri Rakesh Sehgal attended a meeting to discuss the issues relating to data on trade in services in New Delhi, which was chaired by the Finance Secretary Shri Ashok Chawla and attended by senior officials of RBI, Planning Commission, CBEC and Ministry of Tourism, among others.
Initiatives for Members
More Recognition of CA Course: We are happy to report that Indian Institute of Management (IIM, Kozhikode, Kerala) and National Law School of India University, Bangalore have extended facility to our members to pursue Fellow Programme i.e., PhD programme.
Arrangement with Microsoft: We would like to share the information that a Special Pricing (at very low rates) has been worked out with Microsoft for ICAI Members and Students, which is a part of Academic Licensing for providing latest edition of MS Windows and MS Office. Special pricing has also been worked out for providing Microsoft Licenses for ICAI offices and its ITT Centres.
Advisory on Audit Fee: We wish to inform our members that an advisory on minimum audit fee has been prepared to address and resolve the problems in issue of charging professional fees, which will be circulated shortly to our members and firms. Initiative has been taken to amend proviso under Regulation 192 relaxing charging of fee on percentage basis for non-attesting functions.
Convocation in Southern Region: We are happy to acknowledge that Convocation for Southern Region was held in Chennai, which was attended by the undersigned along with ICAI Vice-President CA. G. Ramaswamy and Central Council colleagues CA. V. Murali and CA. P. Rajendra Kumar, and SIRC Chairman CA. Babu Abraham Kallivayalil. In all, 248 associate members attended the function with family to strengthen their sense of attachment with the almamater. Honble Mayor of Chennai Thiru. Ma. Subramanian was the Chief Guest on the occasion.
Placements: Second round of campus placement for UCO Bank was organised in Chennai, Kolkata, Mumbai and New Delhi centres. As many as 19 candidates were selected with an average salary of Rs. 8 lakh per annum.
Development in IFRS Convergence
Out of 38 IFRSs, we have sent 35 Indian Accounting Standards to NACAS to be forwarded to the Ministry of Corporate Affairs for notification. Out of the balance three, IFRS 9, Financial Instruments, and IAS 26, Accounting and Reporting by Retirement Benefit Plans, are not required to be notified at present, and IAS 41, Agriculture, has to be redrafted and, hence, need not be notified now.
New Branches of ICAI: We are delighted to inform that Latur Branch of WIRC was recently inaugurated by Shri Vilas Rao Deshmukh, the then Union Minister of Heavy Industries and Public Enterprises, and presently Union Minister for Rural Development and Panchayati Raj in the presence of the undersigned, Central Council colleagues CA. S. B. Zaware, CA. Jaydeep N. Shah and CA. Rajkumar S. Adukia, and WIRC Chairman CA. Sanjeev D. Lalan. The undersigned also formally inaugurated the Sri Ganganagar Branch of CIRC in the presence of Central Council member CA. Anuj Goyal and CIRC Chairperson CA. (Ms.) Kemisha Soni.
New Buildings of ICAI Branches: We are glad to communicate that the undersigned inaugurated new building of Bhilai Branch recently in the presence of Central Council colleagues CA. Manoj Fadnis and CA. Anuj Goyal, and CIRC Chairperson CA. (Ms.) Kemisha Soni. The undersigned also inaugurated the new building of Sangrur Branch and Information Technology Centre Lab in the presence of Central Council colleage CA. Sanjay Kumar Agarwal and NIRC Chairman and Vice-Chairman CA. Atul Gupta and CA. Vishal Garg respectively.
ICAI Vision & Mission Statement: It is a matter of satisfaction for us that draft Vision and Mission Statement of the Institute and profession has been postulated, which was placed as agenda item in a recent Council meeting for deliberation. Meanwhile, task to consolidate the key inputs and insights collected at various Vision Interactive Workshops has been initiated to draw out a comprehensive strategy and roadmap for achieving the Vision and Mission practically and qualitatively.
Revision in Companies Act, 1956: We wish to inform our stakeholders that draft of revised Schedule XIV to the Companies Act, 1956 was considered and revised as per the suggestions made by NACAS, and was placed before them for consideration. With certain changes, they have approved our revised draft.
On Incentives for Employees: To consider the medical needs of the employees of Institute, the Executive Committee has decided to examine the feasibility of setting up an In-house Trust or extending a Group Medical Scheme, which would cover the retired employees as well. After discussing the matter thoroughly, the Committee would bring the matter to the Council along with its recommendations at a later stage.
Results of Final and Final (New) Examination, and CPT Declared
We wish to inform that results of Final and Final (New) Examination held in November 2010 and Common Proficiency Test held in December 2010 have been declared. We are happy that overall results this time are better than satisfactory. In Final Examinations, on an average 10.79 per cent students have passed in both the groups against appearing in both; 29.65 per cent and 19.32 per cent students have passed in first and second group respectively against appearing in respective groups. In Final (New) Examinations, on an average 9.344 per cent students have passed in both group against appearing in both; and 20.37 per cent and 11.33 per cent students have passed in first and second group respectively against appearing in respective group. Toppers in Final and Final (New) Examination are from various regions.
It is satisfying to note that percentage of female successful students is better than male students in both Final Examination and CPT. Overall, 25.99 per cent students (31878 out of 122639) have passed in the CPT examination. Toppers of CPT are from Andhra Pradesh. After observing the results this year, we sincerely hope and wish that students, both male and female, will keep bettering their previous performances in the years to come.
Let me recall here the confession of a celebrated journalist Shri Khushwant Singh: It is work...that keeps me going... No matter what happens I dont let everyday tensions come in the way of my work and the deadlines I have for the day. I jot down my deadlines for the day in the morning itself and dont retire till I have completed the days work... There is really no substitute for work. I find myself in complete agreement with what he says. These are my recommendations too, to the members, students and staff of my Institute. I would like to assure them that the Council of the Institute will continue to work towards the growth and welfare of both the Institute and the profession. I have always believed in what John F. Kennedy had once told his citizens: ask not what your country can do for you - ask what you can do for your country what together we can do for the freedom of man. Let us show what we can do together for the uplift of the profession and the image of the Institute.
I would like to thank the ICAI Vice- President CA. G. Ramaswamy and all my Central Council colleagues for mutual active and willing help, cooperation and contribution in the growth and development of profession. I never forget my associations. In fact, this is one of the basic instincts of human beings, which sets and proclaims our destiny. I will keep coming back to the Institute to keep the interests of our profession safe and guarded. Though we generally hate to say goodbye, let me inform you that goodbye can not be an end. I know, our paths will certainly cross each other a number of times in the years to come and we will continue to meet and work together again and again.
In this last communication of mine as President of the Institute that I have used to make till date on behalf of the Council of ICAI, I would like to wish all, quoting Irish blessings:
May flowers always line your path and sunshine light your day. May songbirds serenade you every step along the way. May a rainbow run beside you in a sky thats always blue. And may happiness fill your heart each day your whole life through. May the road rise up to meet you. May the wind be ever at your back. May the sun shine warm upon your face and the rain fall softly on your fields. And until we meet again, May God hold you in the hollow of his hand.
It may appear that a certain moment is over, but let me give you another perspective that together we have created some of the best moments of pride for the profession as well as for the Institute in the recent past and we will continue this joint endeavour in future too. Though some of our endeavours may suffer due to discontinuity, but endeavours of greater concerns will continue to stay before us till they get fulfilled; winds may extinguish a candle but eventually fan a fire, it is said. I have come to understand and realise that our journey in life is not about knowledge about everything we desire, but about taking our life head on and making the best of it with all our heart and courage.
From the precedence, I have a satisfaction and a strong belief that the leadership of the Institute will certainly go into deserving hands. I extend my heartiest and warmest wishes to the future leadership, and record the same in advance. I assure the future leadership that my efforts and drives would remain subservient in the interests of the profession and the Institute.
I submit myself to the cause of my profession.
I have not forgotten even for a fraction of second that there is so much to do and comparatively very less time to do that in. I conclude with Epilogue in History of the Accountancy Profession in India written by our first President Shri Kapadia:
The task stands accomplished Nay-it has just begun Its not a question of what stands achieved Its a question of what still remains to be done And am I not a creature of Destiny A mere instrument for His Purpose My assignment I see as one of duty Fruits whereof I cannot and do not seek With humility and full dedication I salute my Institute - I adore my profession.