In order to give due recognition to the Institute of Cost and Works Accounts of India (ICWAI), an apex body to regulate the profession of cost and management accountancy in India, the Ministry of Corporate Affairs (MCA) is in the process of reviewing the existing cost accounting rules and the cost accounting standards of ICWAI.
“As compared to other professional bodies, ICWAI has got lesser statuary recognition, which needs to be rectified,” said Anurag Goel secretary of MCA. ICWAI hasn’t been utilised to its full potential because of the notion that cost and management accountancy is internal to the industry/corporate sector, added Goel who was speaking at an ICWAI function in New Delhi.
In order to enhance the country’s competitiveness, the ministry had constituted an expert group to restructure the framework of cost accounting records, cost audit mechanism and cost accounting standards.
The group has already submitted its report to the ministry, which would now invite suggestions and comments from all stakeholders, said Goel.
The report has recommended that regulators should move from the compliance oriented framework to a performance management framework with enterprise governance in mind. This shift becomes very important in the context of the Rs 7,000 crore Satyam fraud, said Kunal Banerjee, president of ICWAI. On January 7, founder of Satyam Computer Services, B Ramalinga Raju confessed to fudging the company’s accounts and left the fourth largest IT company in the lurch.
“The ministry should get the report examined at the earliest so that the issues of enterprise governance, corporate competitiveness and strengthening the hands of regulatory bodies are addressed to avoid another corporate financial catastrophe, ” added Banerjee.