Our first Prime Minister Shri Jawaharlal Nehru had said on the eve of the independence on 14th August, 1947, addressing the Constituent Assembly: We have hard work ahead. There is no resting for any one of us till we redeem our pledge in full, till we make all the people of India what destiny intended them to be. We are citizens of a great country, on the verge of bold advance, and we have to live up to that high standard. All of us, to whatever religion we may belong, are equally the children of India with equal rights, privileges and obligations. Certain lines of Robert Frost’s poem were found on his notepad and were endorsed by him in spirit: The woods are lovely, dark and deep. But I have promises to keep. And miles to go before I sleep, And miles to go before I sleep. I am in complete agreement with those lines and I believe that there is so little time and there is so much to do.
Let me here refer to Lord Buddha who warns: … we can make two mistakes while treading the path to success and ethics-not going all the way and not starting at all. A strong intellectual heritage and a tradition of trust that our profession has, always place a great challenge before us. I acknowledge, it is my honour that I have been entrusted by the Council of the Institute to lead the profession amidst this challenge. I understand that just being on the right track will not be enough. What we require is a certain pace to be in the run while pursuing excellence for the welfare of our society.
It is always right to begin-irrespective of the constraints of time or space. We can start whenever and wherever. But I believe, if we begin with humility, we will conclude with some sustainable achievement. It is not strange that, with a humble beginning, we always discover an infinite scope of opportunities and possibilities. Let me say if we start with openness, conditions will turn conducive themselves. I still recall vividly the height of optimism of a brave girl called Anne Frank who wrote in her Diary while still surviving the Holocaust: How wonderful it is that nobody need wait a single moment before beginning to improve the world. We must begin. Plato had also said: The beginning is the most important part of the work. All of us have dreams and power to realise them, but all we need is to begin, if we want to achieve success.
As I assume the Institute’s office as its 59th President, I thank all and stay grateful to them for their help and support. Let me confess that it is my honour to serve as the President of the Institute. To begin with, when the outgoing President of the Institute, CA. Amarjit Chopra, said: ‘…the Institute will be in abler and safer hands after me…’, I can only submit my gratefulness to him for his kind acknowledgement. I was guided and tuned by his sheer professional competence. I got ample opportunities to represent on Institutional matters in particular and professional matters in general at various national and international frontiers in the capacity of the Vice-President. I would like to take this opportunity to congratulate CA. Jaydeep Narendra Shah on his election as the Vice-President of the Institute. I am sure, his professional competence and experience will undoubtedly accelerate our endeavours and, particularly, help me in carrying out my responsibilities in the present capacity.
I wish to record my gratitude to the members of the 21st Council for reposing trust in me by electing me as the Vice-President first and, then, as the President of the Institute. It would be inappropriate if I do not thank the members of my profession for their constant and agreeable support. With your cooperation and support, we will write many success stories for the profession and its stakeholders. Let us bring élan vital to our profession. I assure all stakeholders of the profession that we would take stock of all tasks that have not yet begun, or, have been unfinished or in progress, and then we would bring them to conclusion with our organised cooperation and efforts. Past many a time gives us reasons to march ahead and, at times, asks us to stop, look back and evaluate, and then prepare to march ahead. The list of accomplishments should grow forever, and its impressions on policy, planning and implementation should show. The process of development of the profession should continue. When I say ‘our policy, planning and implementation’, I am fundamentally talking about the socio-economic and historical reality of our profession and its gradual empowerment. I am also talking about capacitybuilding of small and medium practitioners of the profession in particular and about nation-building in general. It is an onerous task and I would like to take it up and continue our march to development.
It is true that our profession is at an enviable height. Number of members has increased and so has the number of Branches and overseas Chapters. Membership is in the process of getting consolidated and empowered. We have been a great help to our Government in contouring their accounting procedures. Our Act is in the process of getting revised. We have added to the infrastructure in the past and will continue to do so as we come across a need. Our initiatives have helped the accounting professionals in creating an efficient space where they would deliver and contribute to the growth of our nation as well as of the world. We have successfully reached our international stake-holder community through a number of MRAs and MoUs with various accounting bodies. Almost all international accounting bodies acknowledge today our role in the growth of profession. We are at the helm in convergence of accounting standards while efficiently preserving our indigenous ones keeping in view the structure and process of our economy.
In the background of these developments, I personally would like to concentrate our efforts to creating a unique ICAI brand that would be recognised and treated with respect all over the world, not just in our nation. We will work towards achieving this goal together. I have always believed in the power of togetherness: together, we achieve more. Togetherness is divine-it has the power to bring progress and success to our existence and endeavours respectively. World is full of people who dream and who say that we should act, but there have been very few who actually rise to the occasion and start to act. We need to take a lead, I feel, and move together in unison to substantiate our goals and realise our vision. If we fail or fall, we will start all over again with courage. Entrusted by the Council and committed to the maintenance of integrity and autonomy of my profession, I assure all our stakeholders-members, students and employees of the Institute on one hand, and society on the other- that we will accomplish all the goals together. In areas where we feel we have reached a standstill, we will explore and strive together to find out an opportunity to turn over a new leaf again. I would like to appeal and call upon my Council colleagues and the staff of the Institute: let us make our endeavours a great success. Let us remember the words of the philosopher king, Dr. Sarvepalli Radhakrishnan: All our world organisations will prove ineffective if the truth that love is stronger than hate does not inspire them.
In line with the progress our Institute has been making since inception, I would like to have a look at some of the recent developments that have created an opportunity for the profession in particular and for our society in general:
Action Plan for 2011-2012
I have made public an elaborate Action Plan for the Institute to be implemented during 2011-2012 in the best interests of our profession at large and of the members and students in particular. Our goal primarily will be to uphold public confidence in ICAI and to create global chartered accountants with the help of inducing best international practices in them. To establish the Indian CA brand, I would like to institute awards to our members for their contribution to the profession and the nation at large, and to the highest tax-payer in both individual as well as corporate category. We would try to streamline the tendering procedures and to create awareness about good governance and best accounting practices in cooperatives as well as in NGOs. We would try to hold frequent and focused interactive meetings with CFOs, CEOs and internal auditors to understand and address contemporary issues and needs. I would like to start national study circles at major places and educational services for students in rural and mofussil centres. As part of our international initiatives, I would like to have strategic collaborations with more international accounting bodies so that we could provide a global outlook to our members. Readers may refer to the complete Action Plan (2011-2012), which is printed immediately after this message.
Meeting Shri Murli Deora and Other MCA Dignitaries
I am happy to acknowledge that as Shri Murli Deora takes charge of the Ministry of Corporate Affairs (MCA) as its Cabinet Minister, Shri R. P. N. Singh and Shri D. K. Mittal have assumed the charge of its Minister of State and Secretary respectively. I am sure that under this new dynamic leadership, the Ministry will usher in a new era of development and growth. I along with the Vice-President of ICAI, CA. Jaydeep N. Shah, and the Secretary of the ICAI, Shri T. Karthikeyan, met and apprised them of the working of the Institute and its contribution to nation-building. Here I also wish to record my gratitude and appreciations to the former Minister of State and the Secretary of the MCA, Shri Salman Khursid and Shri R. Bandyopadhyay respectively for their constant support and encouragement in all our initiatives
I am sure that they would continue to do so in future as well. To our personal invitation to address the profession at our Annual Function held in New Delhi, Shri D. K. Mittal, Secretary, MCA, came to our Annual Function as the Chief Guest and gave a special address on the occasion.
I along with Vice-President CA. Jaydeep N. Shah and Secretary Shri T. Karthikeyan recently met Shri Murli Deora. Various issues arising out of the Companies Bill, 2009 were discussed, viz. rotation of auditors, implementation of IFRS, compliance for corporate social responsibility as per the Bill and restriction on number of directorship. Issues regarding the role and responsibility and decent remuneration of independent directors, and appointment of people with domain knowledge and professional capabilities as independent directors were also taken up. We expressed our conviction to continue with the empowerment of small and medium practitioners
MoU with CICA: It is again a pleasure to inform all of you that we have gone a step further in establishing our Indian CA brand and signed an MoU recently with the Canadian Institute of Chartered Accountants (CICA). It was signed by the President and Chief Executive Officer of CICA, Mr. Kevin Dancey, and myself along with the then President CA. Amarjit Chopra. It was a redefining moment as it allowed our members to be a part of a so-called Elite Zone of the Western world.
CAPA Strategic Committee Meeting: This is to inform that I recently attended the Strategic Committee meeting of CAPA held in Manila, Phillipines. Strategic Committee is the think tank of the CAPA, which inter alia dwelt on wider perspective of promoting the profession regionally and globally by undertaking activities in serving the public interest and tends to take into account a broader integration of various stakeholders in achievement of enhancing the standards and development of the profession. The meeting dwelt on strategic thrust areas namely, role of capacity building and leadership on emerging issues and providing a platform for addressing the commonality of issues which affect the profession’s credibility.
PAODC Meeting: I also happened to attend the first meeting of the newly-constituted Professional Accountancy Organisation Development Committee (PAODC) of IFAC recently with the immediate past- President CA. Amarjit Chopra in Singapore, which takes over the reins of the erswhile Developing Nations Committee of IFAC. The meeting inter alia discussed the strategic plan of the Committee and divided the work progra-mme of the Committee into three broad areas, international organisation collaboration programme, ambassador’s programme and mentoring facilitation programme.
Indo-UK Task Force on Corporate Affairs: I along with the then President CA. Amarjit Chopra, and Secretary Shri T. Karthikeyan with other officials of the Institute attended the 5th meeting of Indo-UK Task Force on Corporate Affairs recently in New Delhi. The meeting inter alia focused on mutual sharing of our respective perspectives of promoting good corporate governance, corporate sustainability issues, promoting audit quality and auditor oversight, collaboration and mobility of professionals and qualifications. We also shared the development with regard to our convergence with IFRS in the context of carve-outs vis-à-vis such emulation in the EU context. The two sides with great interest noted the emergence of related corporate social responsibility and best practices including environment getting due leverage in the Director’s Report. We cleared our position that we were fully compliant with the system of quality assurance, investigation and penalty, and that our Quality Review Board was quite independent, as more than 50 per cent of its members are from outside the profession, which gets its administrative and secretarial support through the Indian Institute of Corporate Affairs, Government of India. We further explained that, under new dispensation, the power to discipline our members is with the new Disciplinary Committee and Board of Discipline which are not under our Council’s control. Besides, the final authority on punishment to be given to the guilty is the Appellate Authority to be constituted by the Central Government, not our Council. We informed them that while we already have a functional mutual recognition arrangement with ICAEW, the process for similar arrangements with ICA Scotland and ICA Ireland would be soon revived.
Representation to Parliamentary Standing Committee
As you know, I along with my Central Council colleague CA. Jayant Gokhale, the then Chairman, Direct Taxes Committee had appeared before the Parliamentary Standing Committee on 19th January, 2011 for an oral hearing regarding the Direct Taxes Code Bill, 2010, and our views were favorably considered. However, certain questions were raised by the Chairman and the members of the Parliamentary Standing Committee with regard to our suggestions. We have recently submitted a detailed written reply to the Committee.
Development in Convergence of Accounting Standards
In accordance with the decision of the Council and the suggestions of NACAS, the Indian Accounting Standard on Agriculture is being redrafted. We decided to make amendment in existing AS 11 on the lines of Indian Accounting Standard (Ind AS 21), ‘The Effects of Changes in Foreign Exchange Rates’ to provide an option to defer the exchange differences arising on translation of long-term foreign currency items and recognise the same in profit or loss over the life of such items instead of its immediate recognition, to be followed by the companies after paragraph 46 of AS 11 ceases to be effective, i.e., from 1st April, 2011. It is a matter of immense satisfaction to share that we have completed the task of formulating Indian Accounting Standards converged with IFRS which were submitted and cleared by National Advisory Committee on Accounting Standards (NACAS) for recommendation thereof to the Ministry of Corporate Affairs (MCA) for the purpose of their notification. We have been able to fulfil the commitment that we had made to the Ministry and have been able to adhere to the stipulated timeline.
IFRS Certification Course: To meet the varying requirements of different stakeholders, we have taken all necessary steps to create mass awareness about the preparedness with regard to the convergence. I am pleased to inform that so far 2,607 members have been successfully trained through 100-hour Intensive Training Programme of the IFRS Certification Course across the nation. New batches have been started in Bangalore, Chennai, and Hyderabad.
Training Programme for C&AG: I am pleased to inform that a three-day training programme on IFRS was organised recently in Delhi for the officials of Comptroller & Auditor General (C&AG) of India. Chief Guest Shri Sunil Verma, Deputy C&AG, along with Ms. Ila Singh, Principal Director, C&AG, Chairman–ASB, and the undersigned, addressed the participants on the occasion. Around 50 participants from C&AG participated in the programme. Chairman and Secretary of ASB CA. Manoj Fadnis and Dr. Avinash Chander respectively must be congratulated for their relentless efforts in this regard.
Five New Committees in the Institute
Public Interest Advisory Committee: The role and responsibility of the Committee is to understand the need of the public and their requirements with reference to our profession. It will also extend professional advice to the Government and corporates, and to the common man. It will also identify proper projects with regard to CSR for the corporate and advise them to implement those projects in the interest of the society. It will cater to the needs of the corporates and guide and support them in newer areas of concerns with an understanding about the impact on the nation’s wealth. Apart from this, social audit and welfare schemes of the Government would be carried out with the help of C&AG and other agencies.
Committee for Members in Entrepreneurship & Public Services: This committee will take care of the members in business and trade, who, in large number, have acquired professional skills following the standard set by the Institute and doing their own business in service, manufacturing and trade sector. This Committee will guide them in moving forward in business and motivate many more to enter this entrepreneurship. Apart from this, the Committee will also take care of our members who are working in the judiciary and other government administration.
IFRS Implementation Committee: Considering the current developments in India and in majority of other countries, which require to prepare their financial statements either in compliance with the IFRS or converged IFRS, and considering the globalisation of profession, this Committee will provide support to the member corporate, chief executives, CFOs, etc. While focusing on IFRS, this Committee will enhance the knowledge of our members and users of our services, and organise seminars, conferences and workshops in a more consistent manner.
Committee for Co-operatives and NGO Sectors: This Committee will support and guide the cooperative sector in streamlining their audit and raising the level of their governance, and in bringing out their financial statements in uniform manner in compliance with appropriate accounting standards. NGOs are receiving huge donations within and outside India, which need to be deployed in a manner required under the law. The Committee will also help the NGOs in providing support and guidance towards preparation of uniform financial statements and disclosures.
Disciplinary Committee – Satyam Bench: There is a need to speed up the disciplinary proceedings specifically in Satyam-related cases. This Bench will consider only these specific cases and follow up with the legal authorities towards conclusion of such cases within the set time frame.
Foundation Stone Laying at Patna, Ahmedabad and Saharanpur Branches: I am delighted to inform that foundation stone for the Patna Branch building was laid, where Hon’ble Chief Minister of Bihar Shri Nitish Kumar was the Chief Guest. I along with the then President CA. Amarjit Chopra and my Central Council colleague CA. Anuj Goyal attended the occasion. We also visited Saharanpur for the foundation stone laying ceremony of its ICAI Bhawan. I also visited Ahmedabad Branch for the foundation stone laying ceremony of its new ICAI Bhawan along with the then President CA. Amarjit Chopra.
Management and Maintenance of Hardayal Library: I am happy to inform that the Institute as a part of its social responsibility and to provide library facilities to CA students has undertaken to manage and maintain Hardayal Library at six locations in collaboration with the Municipal Corporation of Delhi. The Library at Chandni Chowk was inaugurated by Shri Prithvi Raj Sawhney, Mayor of Delhi, in the presence of Smt. Aarti Mehra, Former Mayor and, Shri Yogesh Chandolia, Chairman, Standing Committee. I also attended the inauguration along with the then President CA. Amarjit Chopra, my Central Council colleagues CA. Vinod Jain and the then NIRC Chairman CA. Atul Kumar Gupta among others. Facilities made available at the wellequipped Library include an air-conditioned hall with a spacious reading area. I am sure that this facility would help our students in achieving their goals.
Initiatives for Members
MoU for Insurance against Professional Indemnity: I am indeed pleased to inform our members that we have recently signed an MoU with New India Assurance Co. Ltd. extending facility for insurance against professional indemnity for members and CA firms. This MoU will provide cushioned insurance scheme to our members at a heavily discounted premium and would provide indemnity insurance to them covering a risk of Rs. 10 lakh with an extension of allied professional colleagues and for CA Firms including partners with coverage of Rs. 1 crore to Rs. 2 crore. It is a renewable scheme for a year applicable to all members and CA firms registered with the Institute.
Agreement with CCH Wolters Kluwer Pvt. Ltd.: We have entered into an agreement with CCH Wolters Kluwer Pvt. Ltd. under which they would offer mailer and free subscription of the tracker to all our members for one year and, thereafter, for the immediately succeeding year, a discount of 25 per cent would be offered at the rate of Rs. 3,550/-. Members can use this benefit by referring to the ICAI website.
Joint Seminar with University of Madras: I am happy to inform that we organised a joint seminar with the University of Madras recently on Convergence of Indian Accounting Standards with IFRS. Col. Dr. G. Thiruvasagam, Vice Chancellor of the University, inaugurated the seminar. I along with my Central Council colleague CA. S. Santhanakrishnan delivered special address in the inaugural session.
ICAI Channel: We are planning to start ICAI Channel as well as Web TV to provide support to both our members and students towards continuing professional education as well as Live Virtual classes.
Initiatives for Students
GMCS and Orientation Programmes to be Conducted Twice: To improve the quality of our delivery to our newly-qualified members, we have taken a decision to conduct the GMCS course twice in future during the practical training. We have also decided to bring further qualitative improvements in the GMCS course/Orientation Programmes by making it more practical-oriented with an emphasis on technical aspects of the chartered accountancy course. Board of Studies will finalise the syllabus and bring out the revised study material at the earliest.
e-Diary: To make practical training of the articled assistants more effective, we have decided in principle to introduce e-Diary system for them in a phased manner, so that training undergone by them could be monitored. It will facilitate us to analyse and ascertain the direction in which the profession is moving and the nature of services which are being provided by our members to our students, apart from monitoring students and curb dummy training. The data so collected will be kept confidential.
Launch of Student Registration Centres: Students registration centres will be launched very soon across the nation in the offices of chartered accountants. We are also planning to set up more Study Centres by providing infrastructure to all our Branches.
Revolutionary saint-poet Thiruvalluvar, also known by names like Theiva Pulavar, Valluvar and Poyyamozhi Pulavar, says in his Thirukkural (Sacred Couplets), a work of ethics: Learning is excellence of wealth that none destroy; to man nought else affords reality of joy. He goes on to say: Those who can agreeably set forth their acquirements before the learned will be regarded as the most learned among the learned. I firmly believe in avoiding those actions at all times, which bring fame but no real benefit. I agree absolutely if we cannot live in harmony with the world, despite having learnt many things, we will still be called ignorant. I would love to receive your feedback and suggestions during my tenure as President, as this may help us in investing and channelising our efforts in the right direction in improving our strategy and its effectiveness, and, thereby, changing the image and identity of the profession for betterment. A feedback form in this regards has been printed elsewhere in the Journal.
Let us greet all with a smile. Let us show respect to all and, together, we will touch new heights of success for sure. Dutch artist Vincent van Gogh says: Great things are not done by impulse, but by a series of small things brought together. Let me take this opportunity to congratulate all of you, on behalf of the Council, on the festival of colours, Holi, in advance. May this festival spread colours of merriment, delight and togetherness amongst all!
CA. G. Ramaswamy