Renaming is not a simple exercise in the world of chartered accountants. The parliamentary standing committee on finance headed by former finance minister Yashwant Sinha has rejected the demand of the Institute of Cost and Works Accountants of India (ICWAI) to rename it as Institute of Cost and Management Accountants of India (ICMAI).
In the report on the Cost and Works Accountants (Amendment) Bill 2010 submitted to Parliament last week, the panel has recommended that the institute be renamed as Institute of Cost Accountants of India (ICAI).
ICWAI president Brijmohan Sharma told Financial Chronicle that they would pursue their case with the corporate affairs ministry.
The committee in its report observed that the term ‘works’ attached to the profession and included in the institute’s name appears to mislead on the role and functions performed by cost and works accountants globally. And, their function cannot be defined in the act.
However, neither the term ‘management’ nor ‘cost and management accountant’ that are to replace the term ‘works’ in the institute’s name, are defined nor any concomitant changes been proposed in the act pertaining to the role and function of members of the institute.
‘Upon considering the matter, the committee is of the view that as proposed in the Companies Bill, 2009, it would be preferable to term the designation attached to the profession as ‘cost accountant’, and rename the institute as ‘Institute of Cost Accountants’.
The rival Institute of Chartered Accountants of India (ICAI) had opposed the change in name from ICWAI to ICMAI contending that management accounting is one area that is common to all (i.e., ICAI, ICSI & ICWAI) and not exclusive to any of the three professions. It is a position and not a function or discipline.
However, the corporate affairs ministry has supported change of name from ICWAI to ICMA. In a deposition before the panel, it said, “There are several countries such as Canada, the USA, the UK, Bangladesh, Pakistan and Sri Lanka where a dual model of accounting institutes exist. In none of these countries confusion has been created by existence of two titles. Both CMAs and CAs coexist in harmony. The objections of ICAI to a change in name does not seem to carry conviction.”
Corporate affairs minister Salman Khurshid may table the bill in the budget session of Parliament.