President’s Message – December 2009
Dear CA Pariwar,
The ‘green shoots’ of economic revival are now truly maturing – at least from the Indian perspective – and are showing fruits of the labours of the government and regulators. Recovery is gaining in strength across the globe albeit at a slow pace while in India the stimulus packages are cranking the economic engine.
After some deliberation the RBI refrained from hiking key rates while raising the SLR by one percentage point. There is, however, a clear mandate for raising the rates in the near future probably after January. This mandate is being set specifically to curb inflationary expectations. At the same time the growth-inflation trade-off is being closely monitored to prevent any outfall or damage to the recovery uptrend. The decline in exports has been checked and this is one more optimistic sign of recovery. An especially good sign is the large FII inflows for November which have brought the total inflows for 2009 till date to a very encouraging figure of Rs. 71,991 crore.
Overall, the forecast for the next quarter for the Indian economy is quite positive with all estimates pointing to a 6.5% growth rate for the current fiscal year. Keeping the atmosphere upbeat, the Hon’ble Finance Minister Shri Pranab Mukherjee has made his views clear that there were no immediate plans to think of an exit strategy, and that he would review matters only when he was convinced that the economy had come out of the negative situation and was on the path to recovery.
Regular Classroom Teaching for Students
Regulations and policies are changing on a regular basis and with the new tax codes, the imminent induction of the GST and other laws, the pressure on us and our profession is increasing day by day. Students too are bearing the brunt of this changing world and the need of the hour is to help them see through these difficult times with ease. Students need to be guided not only in acquiring knowledge but also in ways and means to acquire it. To help students get a clear understanding of concepts which will help them clear all their written exams, the Institute has decided to step forward and launch regular classroom teaching classes. These classes will cover the entire CA curriculum from A to Z leaving no stone unturned. Students will reap the benefits of attending these classes which have been specially structured to provide personalised attention and help them prepare for all exams from CPT to Final with peace of mind.
On an experimental basis the first series of classes are being launched at the Western Regional Office on November 30, 2009. The timings will be structured to enable students to balance their theory and practical training on an even basis. I am sure that this thorough classroom training in all the subjects of the course will not only help students to clear the challenging examinations of ICAI but will also prepare strong foundations for the future endevours of all students. I request all members to pass on this message to their articled assistants so that they can avail of this benefit.
CA-Shiksha – Gaining Popularity
Our recent e-learning initiative CA-Shiksha has already gained a tremendous following and popularity amongst the students. In less than a month of the launch, there are already more than 10,500 registrations while pages have been accessed more than 5,35,000 times not counting the fact that many students were busy with their examinations in November. Students are finding the lectures simple, useful and convenient in their learning. I am delighted to say that students in the most remote of places are now able to take benefit of this initiative and get access to quality education.
Corporate Governance Week
As we all know, India is a very populous country. Most of the time, the general public is not aware of certain important issues that are crucial for national growth. To bring about more awareness among the masses on the importance of corporate governance in sustainable growth, our Institute is copartnering the Ministry of Corporate Affairs to organise Corporate Governance Week from 14-19 December, 2009.
The goal will be to enlighten the general public about the processes, structures and practices in place to protect the interest of the stakeholder in the current market, while simultaneously encouraging the shareholders to join the governance process to bring to life the latent advantages of corporate governance. The themes enlarged upon during this week include Corporate Governance: Key to Sustainable Development, Governance for Social Empowerment, Creating and Managing Shareholders Value and Investor Protection and Education.
Corresponding to the above mentioned topics, 12 events on corporate governance will be staged covering the cities of Delhi, Chandigarh, Mumbai, Ahmedabad, Pune, Nagpur, Chennai, Bangalore, Hyderabad, Kanpur, Jaipur and Kolkata.
We have gone one step further this time and are placing the keynote addresses that will be delivered by eminent personalities during this week onto our ICAI website as a webcast. These erudite speeches will address various facets of corporate governance and the way it could propel the enterprise to value creation. As always, our ICAI webcast will be available to all our members 24×7.
Formulation of Guidelines on Environment Audit and Social Audit
I recently participated in a high-profile meeting of the Audit Advisory Board at the office of C&AG of India. The deliberations centred on Environment and Social Auditing. Subjects such as Strategies on Environmental Audit, Synergy between CAG’s Audit and Social Audit, Social Audit and Environment Auditing in India were discussed.
At this meeting, it was felt that the Institute may take a lead in developing guidelines in these twin areas of emerging importance for the corporate world. Accordingly, I discussed the matter with C&AG of India wherein it was felt that guidelines developed by them may act as a frame of reference. I feel that the guidelines in the aforesaid areas should be developed and published at the earliest for the benefit of professionals at large.
In this regard, I am also considering to form a special group and organise a series of corporate workshops to ponder over various aspects of Environment and Social Auditing in detail. I am sure these initiatives will go a long way in providing newer professional opportunities and furthering the interests of the profession and the country.
‘Know Your Client’ Norms
With increasing incidence of economic offences in the Country and threat of terrorism and money laundering looming large over the society, it has become of utmost importance to know the credentials of our clients. As a watchdog of financial sector, it is our national duty and social responsibility to report about our ambiguous clients and their unscrupulous activities to the authorities concerned. To facilitate this, I propose to formulate and put in place ‘Know Your Client’ norms, having through checklist and guidelines, for CA profession on the lines of ‘Know Your Customer’ norms in place in banking industry. This step will surely serve our society and country a great deal.
Group on Goods and Services Tax
Members are aware that the proposed Goods and Services Tax (GST) regime is on the horizon. In order to get a better understanding of the concept, the Institute has constituted a group under the convenorship of CA. Govind Goyal to study and deliberate on the GST, its implementation and ramifications. I request all members to send in their suggestions on various aspects of the GST so that the same can be represented to the Government and clarifications can also be obtained on the issues involved.
As members are aware, under my chairmanship in 2007 the Committee for Members in Industry came up with a wonderful new initiative called the Corporate Forum. The goal of this event was to enhance the brand image of CAs in service as well as to provide career opportunities, expand their knowledge base, enhance skill sets and most importantly recognition of exemplary work by Members in Industry.
For 2010, the third edition of this forum will focus on an all round development and recognition of our members. The events will include Career Ascent – Mid Career Campus, Special Campus Placement Programme, Accounting Thrust – Career Fair for ICAI Certified Accounting Technicians, Corporate Conclave – In Pursuit of Excellence, Capital Advantage- Invest & Buy Mart, ICAI Awards for Excellence in Financial Reporting, and ICAI Awards 2009 – Corporate CA Achiever’s Acclaim. For the first time a placement programme for ICAI Certified Accounting Technicians will be conducted. This placement programme will be directed towards meeting the requirements of the organisations for entry level accounting professionals.
As you can see we are going all out to support, encourage and promote our members to the hilt. With the Indian industrial sectors expanding, we decided to extend the CA Professional Achiever and CFO Awards to include the new sub-categories of Auto & Ancillary Sector, Telecom Sector, FMCG Sector, Healthcare Sector and the Engineering and Capital Goods Sector this time.
I extend my personal invitation to all members to participate in the Corporate Forum and utilise this excellent opportunity.
Elections – Vote Judiciously
I am happy to see the enthusiasm of the members in the run up to the elections. Your complete participation during the canvassing as well the voting should ensure a successful election. Yet, at the same time, I am obliged to remind members not to get carried away by the electioneering but audit each and every candidate very carefully. Balance the pros and cons and check for actual contributions made by candidates. These contributions may be professional, social, charitable or may be the sharing of knowledge even, but at the end of the day these should be genuine contributions which enrich society, the Profession or our Institute.
I exhort you to select the best candidate for your Institute. Select candidates with impeccable professional integrity and wisdom, who will wholeheartedly build the future of our Profession and our Institute. Irrespective of cast, creed, religion or group, vote for candidates with futuristic vision and strength who will take the Institute and all its members to greater heights of glory.
Women -Taking the Lead
I am proud to say that the ICAI Women’s Steering Group has really rallied around to make the 3rd Women’s Conference on “Women-Taking the Lead” a much appreciated and successful event.
The main goal of the Group to motivate and empower women through inspirational models is praiseworthy. The thoughts and experiences of successful women from all walks of life and from myriad professions were presented to great acclaim during the course of this conference. I believe the Conference went a long way in bringing to light the fact that women can and do live to their full potential professionally and personally.
Notable guests included the Director General of Police, MDs of companies and our own accomplished women Chartered Accountants. I hope these inspirational events by the Women’s Group will continue to inspire and motivate our own members as well as other women in our country in the years to come.
Infrastructure – The Momentum Continued
The last few weeks have seen significant progress in our infrastructure portfolio. Our Centres of Excellence in Jaipur and Bangalore have seen their drawing and infrastructure facilities finalised and the architects appointed. I am pleased to inform all members that the four buildings that make the ICAI Bhawan Complex, Noida are nearing completion and will soon be open to members in their entirety. Land for the ICAI Bhawan, Kolkata has been acquired, the architects appointed and the drawing and infrastructure facilities finalised.
We are spreading so fast that we have acquired numerous parcels of land for various new branches all over the country from Beawar (Rajasthan) to Kottayam (Kerala), Nashik, Patna, Solapur, Amravati, Akola and Nagpur. In fact, the Vadodara ICAI Bhawan building is nearing completion and will be inaugurated in December 2009.
First Meeting of Asian-Oceanian Standard-Setters Group
I participated in the first meeting of the Asian-Oceanian Standard-Setters Group (AOSSG) held at Malaysia in the first week of November, 2009. The recently formed AOSSG is a group of accounting standard-setters across the Asian and Oceanian regions for the establishment of a mechanism and platform to discuss and share resolutions to emerging issues in the process of convergence and contribute to the development of a single set of high quality global financial reporting standards. This meeting was attended by Chairman of International Accounting Standards Board (IASB) Sir David Tweedie and representatives of 21 accounting standard-setters bodies from the region. The attending countries also agreed and signed the Memorandum of Understanding (MoU) formalising the establishment of AOSSG. The Group is working to evaluate and formulate implications of IFRS convergence and dovetailing it to stakeholders’ requirements in context of convergence with IFRS in the region.
ICAI International Initiatives
My ambition has always been that Indian CAs go international and the Indian CA becomes a truly global brand. After the successful conclusion of MRAs with the three renowned accounting bodies i.e. ICA of England & Wales, ICA Australia and CPA Australia; we have initiated the dialogues for similar MRAs with accounting bodies in South Africa, New Zealand, Malaysia, Ireland, Scotland and Mexico to name a few. While I was at the IFAC Chief Executive meeting in USA recently, this intent of ICAI was renewed with one–to–one interactions with heads of accounting bodies of these countries. There, I also encouraged the Accounting Technician body of Kosovo to be part of an International Federation of Accounting Technicians (IFAT) initiative. Fruitful discussions have been held with both CICA and CGA-Canada and the bridging mechanism with these two bodies is likely to be crystallised in the near future.
The MoU with Center of Excellence in Research and Training, Abu Dhabi has been given a push in terms of implementation and fruitful discussions; followed by preliminary assessments of local needs for offering them a customised programme.
CAPA is conducting a workshop on IFRS for SMEs at Centre of Excellence at Hyderabad. This programme will be delivered by world class faculties and will be attended by international delegates. This is a great learning opportunity for our members to get ready for IFRS adoption in SMEs with the advantage of learning from global experiences. The programme is being delivered at a discounted rate of US $150 (30% of actual cost) especially worked out for ICAI members. I would encourage the members to capitalise on this opportunity to gain the competitive advantage in the evolving market. Details in this regard are available at ICAI website or you may write at email@example.com for any clarifications.
ICAI Abu Dhabi Chapter Celebrates Silver Jubilee
The Abu Dhabi chapter of the ICAI recently had the occasion to celebrate two great moments in its history. One was the celebration of the historic Diamond Jubilee of the Institute and the other moment was the Silver Jubilee anniversary of their own Chapter. Both are important milestones on the road which charts the growth of the Institute.
Keeping the past, present and future in perspective the Abu Dhabi chapter celebrated this dual event by organising an International Seminar on the pertinent theme “Beyond Turbulence – Blazing New Trails”. The theme was proposed after observing the current global financial situation. With the financial meltdown having spread across the world sparing no country, nation or profession, the new challenges thrown up by this situation needed to be scrutinised and analysed very closely.
The Conference proved to be an excellent forum at the international level for the exchange of ideas amongst renowned accounting experts, international doyens from the field of finance, and corporate honchos. The success of this Conference clearly outlined ICAI’s position as the Premier Accounting Body in the region. A report on the chapter’s silver jubilee function has been published elsewhere in this journal.
ICAI International Study Tour to USA
India is the second fastest growing economy in the world. Our stability in the face of the recession proved to the world the inherent strength of the Indian financial and economic systems. Even the world’s superpower – the United States of America (USA) – acknowledges India’s growing role on the world economic stage. India and the US have a very symbiotic relationship covering trade and commerce. What was not known earlier but will now be common knowledge will be the relationship shared by the ICAI (the second largest accounting body in the whole world) with the American Institute of Certified Public Accountants (AICPA) which is the largest accounting body in the whole world.
We share a deep respect for the AICPA as do they for the Institute and Indian CAs. I feel this is the right time to further bridge the gap and make stronger our relationship with the AICPA. To that end, I feel a strategic alliance formed by recognising each other’s qualifications would be a very positive step in the right direction.
To understand the economic and regulatory environment as well as to obtain a better understanding of the vast economic opportunities available for Chartered Accountants in the United States of America, we are organising an educational and business tour to select cities in USA this December. The study tour will mainly focus on business and networking meetings to optimise the time spent there.
The main goals to achieve through this tour would be to build sustainable capacity by providing participants an opportunity to see and interact with various officials in respective countries. It will facilitate understanding and steps towards networking of the accounting firms in India and respective countries while seeking association for the research and developmental activities of the Institute in different fields. During this tour we will also discuss the issues of qualification and ways to facilitate cooperation at firm level while developing an understanding to help trade and industry in the respective countries and facilitate inter-country trade and investment. This tour has already received very overwhelming response from the members.
As I conclude this message I would like to inform you that I am honoured to have the privilege of accompanying the delegation of the Ministry of Corporate Affairs, Government of India to take part in the upcoming Indo-UK Taskforce meeting on Corporate issues in December 2009 in London.
I will take this opportunity to carry high the flag of our Institute while spreading the eternal Indian message of peace and unity which says ‘Yatra Vishvam Bhavati Ek Nidam’. This quote from the Yajurveda tells us that the whole world is one family and that we should live together as one united family.
My Pranaams to all,
CA. Uttam Prakash Agarwal