I look forward to communicate with you through these pages to keep you abreast with the developments that are taking place in our Institute and our profession. With every communication I see time ticking by and feel that there are so many things to do in the limited time at my disposal. However, I am sure that with relentless pursuit and single minded purpose I will be able to carry out the task effectively this year. I would amply draw on your encouragement and support which would be my source of inspiration and strength.
Before I enumerate the latest developments of our profession, I would like to discuss a matter of social responsibility for all of us and matter of great importance for any democratic country. Time has come for us to discharge our most onerous responsibility to our nation. Time has come to rise above petty politics and public apathy and cast our vote not in favour of any party but in favour of the most deserving candidates who can successfully steer our country to the path to prosperity.
It is very disheartening to note that in our country qualified and learned people abstain from voting in large measure. Not this year. Let us resolve that this year not only will we vote but will also influence everybody around us to cast their vote. We are a strong Pariwar of 600,000 members who can cast our vote and also influence individually another 200 families to do likewise. We are a power to reckon with. We have the power to change the destiny of our Nation. Let us not lose that opportunity. Let the Nation wake up to the collective influence our members can exert on society.
With the elections to the 15 Lok Sabha round the corner, I urge each and every professional colleague to cast his or her vote. Every vote counts to bring about change in the country. It is our ardent duty to cast our vote in favour of those who have been agents of change and who have worked assiduously to bring about betterment of Society and have the ability to lead the nation.
With this resolution, let's move one by one to the developments that have taken place since my last communication.
Information Technology Directorate
India is known all over the world as an I.T. Nation. There is greater stress today on egovernance and compliances and procedures are now driven by technology. Everyone expects fast communication and speedy information due to the advantages of Information Technology.
I am glad to inform you that this year we have introduced a new e-governance initiative by the name 'PARIVARTAN' under the consultancy provided by Infosys. The aim is to re-look at our business processes and introduce IT enabled systems to make the services of the Institute available in a simple and user friendly manner to the members and students at large.
You will be happy to note that a decision has been taken to establish a full-fledged Information Technology (IT) Directorate to bring all IT activities of Institute under one umbrella to enable co-ordination and optimum use of resources for the developmental activities relating to members and students. The IT directorate shall synchronise, standardise, optimise and expedite the processes to bring a unified approach towards all IT initiatives such as Virtual Institute Project (Institute's ERP), Online Exam & Results Processing, websites and portals, e-Learning, IT education and training to members and students including Post Qualification Courses and Information Technology Training. The IT Directorate shall come into operation from April 2009.
In order to enhance the Institute's Brand Image and also to expand professional opportunities for our members, we organized Information Session on Forensic Accounting and Fraud Detection using IT & CAATs Value Added Services by CAs for the Economic Offences Wing, Crime Branch, Delhi Police. We have also restructured the entire Local Area Network at our data centres in Chennai and New Delhi contributing to improved performance of Virtual Institute Project, introduced shopping cart for online ordering of the Institute publications and a facility for online mock examination for the CPT students.
I am delighted to inform you about one more eRoom initiative to provide online access to ICAI Knowledge Resources such as Publications, eLearning Modules, Journals, Newsletters, Discussion Rooms to Collaborate and Webinars to both members in industry and practice. The proposed eRoom will serve as a reference site for members.
Autonomy to Banks to appoint Auditors
This issue has been on my mind during the entire tenure as Vice President last year. I have held several meetings with C&AG, Finance Ministry and the Reserve Bank of India (RBI) to seek a reversal of their decision to grant autonomy to public sector banks to appoint statutory branch auditors because of the conflict of interest it poses for the audit firms. We have reiterated that the centralised practice of appointing the Statutory Central Auditors and Branch Auditors through the good offices of the RBI is the key to good Corporate Governance which enhances investors' confidence.
While the whole world is grappling with financial failures of banks worldwide, it is noticeable that the Public Sector Banks (PSBs) have remained untouched. Certainly, a major part of credit goes to the strict regime of auditing enforced by the RBI, ensuring auditors' independence by centralised process of appointments. Thus, the role of RBI as a Regulator in ensuring the proper management of public money cannot be denied, and, therefore, it would always be in the common interest that the responsibility must continue to vest with RBI for not only PSBs but also for private and co-operative banks.
We trust that next year the decision to grant autonomy to Banks to appoint auditors is reversed.
In response to the show cause notice issued, M/s. Price Waterhouse, Bangalore has disclosed the name(s) of members answerable and time has been granted till 2nd of April, 2009 for submission of their written statements. Disciplinary action has also been initiated against the Ex-CFO, Senior Vice President and Audit Cell. In addition to the above, various clarifications/documents have been sought from various sources, namely, the SEBI, the ROC, Hyderabad, the Company, etc. However, no papers have been received from any of the sources.
In light of the above, it is the onus of every member of the profession to be more vigilant and to restore public confidence in the profession. The Ministry of Corporate Affairs (MCA) has also sought a report from the Institute to suggest changes in Chartered Accountants Act and Regulations and other Acts so as to better regulate the operation of multinational accounting firms in India, their linkage with Indian Chartered Accountant firms, rotation of auditors/joint auditors, role of audit committees, role of independent directors, process of giving practice rights, etc. A report has been submitted by us to the Ministry for vesting adequate powers in the Institute to effectively deal with such situations.
Insurance Regulatory and Development Authority (IRDA)
I also had an opportunity to have a meeting with the Insurance Regulatory and Development Authority (IRDA) and represented to them that CA qualification should be made mandatory for the posts of 'Compliance Officers' in various insurance companies and CA independent directors should be made mandatory on the Boards of private insurance companies similar to public sector insurance companies.
We also submitted that Internal/ concurrent audit should be made mandatory to all functions of the insurance companies and that the Institute's organs Regional Councils, Branches, CPE Chapters and Study Circles could be utilised for conducting insurance awareness programmes with funding support from IRDA. We also suggested that verification of solvency margin should be conducted throughout the accounting year, separate detailed Regulation should be developed for regulating ULIPs of insurance companies and CAs should be involved in NAV certification.
Women Steering Group
We have been witnessing a steady surge in the number of girl students opting for CA course. Out of total 469,591 students, 148,832 are girl students amounting to almost 40%. The result of CPT Exam - December 2008 showed that the pass percentage of girl students is better i.e., 42% as against 37% of the boy students.
Recognising the need to work towards empowerment of women to enable them to make their contribution in the profession, society and their personal lives, ICAI is establishing a Women's Steering Group with the aim of defining better role for women CAs coinciding with the International Women's Day i.e. March 8. This forum has been constituted to focus on the current status of women CAs and students and to focus on their capacity building and position them as competent, capable, collaborative partners in all facets of professional and allied activities.
Further, I wish to inform that the Call for Nominations for IFAC Boards and Committees in 2010 has been posted on the IFAC website and IFAC is also committed to improving gender balance on all its boards and committees and thus nominations of women to the IFAC Board and the Committees are encouraged. In the past, ICAI had sent the nominations of two women candidates and both were appointed on the IFAC Committees as ICAI nominees. I will also put my best efforts to see that more such women representation can be made on the IFAC Board and the Committees.
I may add that the MRA with CPA Australia st would be in force w.e.f. 1st April, 2009 as notification process to Australian Competition Regulator, the Australian Competition and the Consumer Commission, is now complete at the end of CPA Australia. I understand that 70 odd members have already applied to CPA Australia and I am sure that a large number of ICAI members would like to avail of this arrangement. Operational details would be available on the Institute's website shortly.
Further, the bilateral talks with Institute of Chartered Accountants of Australia with regard to Qualification Recognition are likely to conclude soon and further details will be notified in due course.
The Institute of Professional Accountants of SAMARA Region (SIPA) has also agreed to recognise ICAI qualification for granting membership of SIPA without requiring passing of any additional examination. Further bilateral talks in this regard are going on with SIPA. The Institute has support from the Government of Samara Region of Russian Federation. SIPA is also a corporate member of the Institute of Professional Accountants of Russia (IPAR) the largest professional accounting body in Russia, which is also a member of International Federation of Accountants (IFAC). Operational details are being worked out.
I am glad to inform that the much awaited approval for establishing a Chapter in Singapore has been received from the local registrar office of Singapore and the formal inauguration ceremony of Singapore Chapter of ICAI would be held in the last week of April or first week of May 2009.
In terms of infrastructure, we have been fortunate to turn our dreams into reality. The Government of Karnataka has allotted 10 acres of land at Kalyana Pura village Solur Hubli Magadi Taluk on Bangalore-Mangalore highway for setting up of a state of art Cenrte of Excellence in Bangalore. I wish to thank CA. Rameshwar Thakur, Hon'ble Governor of Karnataka and CA. K. Raghu, Council Member from Bangalore for helping us in this endeavour.
Also the Foundation Stone was laid for construction of building in Coimbatore while a new building in Cuttack and an auditorium in Ludhiana was inaugurated.
We hope to keep up with this pace of building the best infrastructure for our Institute throughout the length and breadth of our country so that we can better facilities and services to our members and students at their door step.
CA Pariwar Foundation
As informed to you in my last communication, I have set about giving shape to the 'CA Pariwar' foundation. I hope to get the foundation registered soon and will inform you of the activities and initiatives that will be undertaken by this new exclusive foundation.
To inculcate a sense of belongingness and to promote the concept of Pariwar amongst our members and students, personalized SMSes and e-mails for conveying my good wishes on birthdays has been initiated. I am happy to share with you that the concept has received an overwhelming response.
National Leadership and Yog Camp
While we constantly debate and introspect through various channels of leadership, I am happy to inform you that a unique four-day Residential National Leadership and Yog Camp was held at Yoggram, Sidkul,Haridwar which was attended by around 600 members of ICAI Council, Regional Councils and Branches. The four days saw discourses and learning in Yoga & Yogic Science by Swami Ramdevji.
The professional debates were coupled with yogic way of living to inculcate within oneself element of disciplined living leading to de-stressed life and thereby contributing to positive energy in our day-to-day professional life. Seeing the excellent response to the programme which juxtaposed professional learning and introspection by discussing ways the accounting professionals should attain balance and equilibrium in life by de-stressing through yoga, more such programmes will be planned in future. Holding of Yoga sessions for ICAI members at regional/branch level is also being explored in collaboration with Patanjali Yog Peeth.
Empanelment Application Form
To mitigate the problems faced by the members in filling up empanelment application form every year, the Council of the Institute has decided to go for a simplified Multipurpose Empanelment Form which will be hosted on the website in the first half of April, 2009. I expect that this revamped form will make the form submission process stress free for members.
Changes in the Journal
Our Journal has always evolved to become more informative and readerfriendly. This year we have endeavoured to bring about qualitative changes in design and content and have introduced many new sections which are beyond our traditional interests such as Vaastu Shastra, Know Your Future, Health Tips, etc. This, we hope, will enlarge reader interest and cover even the families of our members so as to encompass the entire CA Pariwar.
We have also decided that besides the regular sections like accounting, auditing and taxation, other new sections like WTO, Capital Markets, Management, Economy, Outsourcing, etc. be introduced in the Journal to make the coverage of subjects more comprehensive and ensure that about 20 different areas are covered every quarter in the journal.
Diamond Jubilee Activities
The Institute was established under the Chartered Accountants Act, 1949 and I feel proud to be the President during its Diamond Jubilee Year. In order to make Diamond Jubilee Year most eventful and memorable, we started introducing many initiatives from last year itself so that they can be completed in time for the Diamond Jubilee Year. I am happy to inform that we are hosting an International Conference on the themeWinds of Challenges Global Strategies for Accounting Profession from 3rd to 5th July, 2009 at Agra. The Conference website has already been launched and arrangements are in progress for finalising the best of international and national resources to make the Conference a milestone in the history of the Institute.
In order to bring the CA fraternity closer to other stakeholders group, as a part of Diamond Jubilee Celebrations, the Institute is organising a Diamond Jubilee Cricket th Match on 4th April, 2009 between All India Chartered Accountants and All India IRS Income-tax Officers at Ferozeshah Kotla Ground, New Delhi.
I have asked the Vision Committee, which was originally established in the year 2007 to develop Vision Document, 2021, to work on developing vision for shorter time frames; for a period of three to five years; for a foreseeable future. In this fast changing world, it is extremely difficult to predict the economic or professional scenario for next 10 - 12 years and develop action plan on that basis.
I would like to have Vision Documents for each Council Term which set out year on-year road map. This will have the benefit of having clear and identified goals for each President and Committees of the Council. Everyone will have a direction set out for them when they take over and they will not have to spend time in identifying goal and developing action plan and then implementing it. They can start running from day one. This will lead to effective cocoordination and concerted efforts in achieving the Vision translated into goals backed by relevant and current data and information. Some goals will of course be dropped and some will be added as we move forward.
Due to changes in the economic environment which have thrown open more challenges and opportunities for professionals, it is imperative to build capacities of small and medium firms in order to enable them to face and take advantage of this competitive environment.
Many open meetings, workshops, round-table conferences will be organised to educate the members, to create awareness, address the apprehensions in their mind regarding capacity building measures like Networking, Mergers and Management Consultancy Services in Corporate Form, to identify the benefits, advantages, disadvantages and challenges being faced by members while resorting to such consolidation processes.
Also many initiatives will be taken to explore other areas of capacity building like venture capital, tie-ups with banks for availability of funds at cheaper rates, working out the modalities for creation of virtual library and facilitating the pooling of infrastructure facilities so that members can actually come together under one roof.
The Institute will be taking a number of initiatives in order to ensure that our profession is ready to adapt to IFRS from 2011. The Institute has set a target to ensure that at least 10,000 members are fully equipped to discharge their professional work based on IFRS by 2010 and another 10,000 by 2011 and adding more and more members every year. The Institute will undertake this initiative through various methods to demystify IFRS by organizing seminars, preparing comprehensive study material and e-learning modules. The Institute will also carry out a comprehensive research to understand the impact of implementation of IFRS on various segments of industry. It would be its endeavour to include IFRS in the course curriculum in the future.
I would like to end my communication by stating that the Institute leadership is not restricted to the elected members only. Each and every member and student can be a leader by contributing towards the activities of the Institute or giving suggestions for improving the functioning and service of the Institute. One need not wait to meet the leadership of the Institute but can also contribute or offer suggestions, make representations, undertake research, contribute in brand building or suggest changes in curriculum through e-mail or other modern communication tools. I sincerely hope to see more active participation from my entire CA Pariwar.