Remarkable decision over tenders by ICAI but Clarification sought

Respected CA Manoj Fadnis

President , ICAI , New Delhi

Ref; Thanks for such remarkable decision over tenders but kindly Clarify the tender decision.

Dear Sir,

It’s a matter of great pleasure that a much overdue action has being announced over the tendering. The whole of council deserve appreciation and the decision day shall be taken as red letter day in the history of profession. We wholeheartedly pay our Thanks for such a decision in 338 th council.

A four point note was released by PDC recently. The first point of the note says that

 I. Tendering has been prohibited in the exclusive areas of practice of chartered accountants like audit and attestation services. i.e. those areas where the assignments can be performed only by chartered accountants.

II. In those areas, where along with chartered accountants, the other professionals can also apply for the tender, there is no restriction for the chartered accountants to respond to the tenders floated by authorities from time to time.

III. Its all fine , but your attention is invited to various issues as mention in point No. 2 which says,

1. Members are advised to adhere to the recommended scale of fees prescribed by ICAI in the context of various professional assignments.

How can it be possible?  When you are allowing a member to bid against other professional, how can a fee be monitored? Our recommended fees are in public domain so the other professional shall bid for one rupee less than our prescribed fee and the whole purpose of our bidding with the other professional shall be forfeited.

2. To ensure such adherence, a member responding to a tender should be required to furnish to ICAI at the designated e-mail address pdc.tender@icai.in with estimated hours to be devoted by the partner/proprietor, paid CAs, other staff and the fees quoted in the tender. Such details will be furnished by the member within a period of fifteen days of his responding to the tender.

This talks about 15 days of responding to tender. Though there is no purpose to chase the member if he is competing with other professional. Even then if iCAI  want to keep a watch over such affair in the name of quality check then it should be fifteen days from the opening of the tender.

3. If the member is successful in securing the tendered assignment, then the member will also furnish the actual hours devoted by the partner/proprietor, paid CAs and the staff within two months of completion of the assignment.

Whats the purpose of this second check?  We are having a system of peer review and quality control Board so this is unwanted issue to question after completion. You are attacking the liberty of the member of doing work with his conscious. This is unwanted.

4. Members are required to maintain cost sheet in the given format while submitting any tender/bid. The format of the same can be viewed at http://220.227.161.86/38366pdc28039.pdf

When you are allowing a member to bid against other professional, whats a need to keep a cost sheet ? The whole purpose of our bidding with the other professional shall be forfeited. If member is subject to any questioning.

5. Members are required to maintain the cost sheet compulsorily and submit a soft copy of the bid submitted by them in response to any tender within 15 days to ICAI. The office can check whether recommended scale of fees has been followed or not in those bids, to ensure adherence to quality standards.

Again this is an unwanted and undesired because CAs can bid for Audit service and where we are allowed we must be free from all.

You are requested to intervene in the matter and take a positive decision in the members’ interest.

Thanking you,

Sincerely Your