The government may consider a separate regulator for those who keep a check on company books chartered and cost accountants, and company secretaries.
Salman Khurshid, minister for corporate affairs, told The Telegraph, We will have to examine whether the current structure of peer control and regulation is sufficient, or a separate regulator for the professions is needed.
Such a move means the government will have to move Parliament to amend the acts governing the three professions.
If the government decides to go ahead with the move, it can either set up a single regulator for the three professions or separate regulation from the other functions of the apex bodies of these professionals.
The role of chartered accountants and company secretaries came under the scanner after the scam at Satyam Computer, whose founder B. Ramalinga Raju confessed to a Rs 7,100-crore fraud. Satyam auditors Subramani Gopalakrishnan and Srinivas Talluri, of Price Waterhouse, are still languishing in jail.
Khurshid, who is a lawyer, said, In the West, education and training and regulation are divorced from each other, possibly we may have to look at that model.
Currently professionals are not answerable to anyone except their own body unless they are indicted under the criminal code, he said.
Kunal Banerjee, president of the Institute of Cost Accountants of India, said, We agree. There should be a high-level accounting oversight body such as in the UK. The quality of oversight and transparency would improve.
Official sources said there was little liability upon professionals who certify, or gloss over, defective books of accountants. Rarely has any action been recorded against professionals suspected of misconduct.
Since the Satyam fraud broke out in January, the Institute of Chartered Accountants of India (ICAI) had sent showcause notices to the two auditors of Price Waterhouse. The ICAI has been seeking more power to guard against Satyam-like frauds.
We would like to hear from them (professional bodies such as the ICAI) whether they feel a sense of inadequacy, Khurshid said.
Earlier last week, the minister, in written replies to questions in Parliament, had described the Satyam scam as an aberration.
The Satyam scam is an aberration and the events are specific to the company in question. No other scam of this nature has come to notice since then.
The Serious Frauds Investigation Office, under the ministry of corporate affairs, has completed its probe into the Hyderabad-based infotech giant, and the government is taking steps to prosecute those involved in criminal wrongdoing.
Vineet Nayyar, executive vice-chairman of Mahindra Satyam, today said the company was open to an out-of-court settlement of the class action suits that it was facing in the US. Mahindra Satyam is the new name of Satyam, following its takeover by the Mahindras.
Khurshid said, Most of the class action suits in the US do get settled out of court and it is sensible to do so.