Institute of Chartered Accountants of India
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The Institute of Chartered Accountants of India (ICAI) is a statutory body established under the Chartered Accountants Act, 1949 (Act No. XXXVIII of 1949) for the regulation of the profession of chartered accountancy in India. During its more than fifty years of existence, the Institute has achieved recognition as a premier accounting body in the country for its contribution in the fields of education, professional development, maintenance of high accounting, auditing and ethical standards. The ICAI now is the second largest accounting body in the whole world.
The Chartered Accountants Act, 1949 was passed on 1st May. The term Chartered Accountant came to be used in place of Indian Registered Accountants. So the term "Chartered" does not relate to Royal Charteras in case in UK or Australia as there is no Royal Charter in Republic of India.
The ICAI has setup three levels of exams for gaining membership to the Institute of Chartered Accountants of India: (To be attempted in the same order)
1) CPT
2) PCC
3) Final Exam
All the exams are compulsory to be awarded membership and due training under the guidance of a C.A firm in required.
The Institute conducts its examinations in May and November each year and has exam centers in major cities/regions in India, one each exam center in Kathmandu (Nepal) and Dubai (UAE).
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[edit] Motto
"That person who is awake among those who sleep" - This is from an ancient Sanskrit text and signifies the function of a Chartered Accountant as a sentinel. The Institute has also introduced a new logo for Members - 'CA' - Alphabets of Trust.
[edit] Members & Students
During its 58 years of service to the nation,it has reached a membership of 141,516 and student strength of nearly 400,000 (As on 1.7.2007)...
[edit] Services by a CA
An important phenomenon of recent times is the rapid growth of the accountancy profession. The vast changes occurring in the economy of the country have been placing great responsibilities on the Chartered Accountants. It also constitutes a challenge to the profession to bring to bear their knowledge and skill in their specialised fields of activity. The types of functions generally performed by the Chartered Accountant are varied. The more important ones amongst them are discussed below.
Accounting & financial analysis
This includes the writing up of accounts and the preparation of financial statements. It encompasses a wide area ranging from simple Book keeping to complex financial analysis.
Auditing
Possibly one of the most important functions of a Chartered Accountant, it is here that his specialised training, skill and judgment are most often called into play. The purpose of auditing is to satisfy the users of financial statements that the accounts presented to them are drawn up on correct accounting principles and that they represent a true and fair view of the state of affairs of the organisation.
Taxation
With a number of taxes on the statute book, current and continuing tax information has become vital to the effective economics of business management. The assessment of taxes is very closely linked with financial accounts. The Chartered Accountant with his experience in accounts is in an advantageous position for preparing the returns for tax purposes, representing assessees before the Income-Tax authorities and rendering general advice on taxes to his clients. An additional responsibility placed on him recently is that his services will be required by the tax department for auditing complicated cases, having large revenue potential. The requirement under the Income-Tax law for compulsory maintenance of accounts by the specified categories of taxpayers would also make a demand on his time and services. Every assessee with a minimum turnover of Rs. 10 lakhs in the case of professionals and Rs. 40 Lakhs in the case of business concerns is compulsorily required to get his accounts audited under the Income-Tax law. This has considerably helped the revenue authorities in making proper assessments.
Cost Accountancy
A Chartered Accountant is also trained to ascertain the costs of production and of processes at different levels of operations in the manufacture of a product and in the rendering of a service. He is also equipped to provide costing information for the guidance of management, introduce cost control methods and assist the management in establishing appropriate selling prices.
Special Company Work
The services of Chartered Accountants are frequently sought in connection with matters such as the formation, financial structure and liquidation of limited companies. Secretarial and Registration work and the duties of a Receiver are also undertaken by them, in addition to other company work.
Investigation
Chartered Accountants are often called upon to carry out investigation to ascertain the financial position of business in connection with matters such as a new issue of share capital, the purchase or sale or financing of a business, reconstruction and amalgamations. Their services are also sought for undertaking investigations with a view to achieving greater efficiency in management or administration, finding out reasons for increases or decreases in profits etc.
Executors and Trustees
A Chartered Accountant is also often appointed executor under a will or trust in order to carry on the administration of the estate or settlements.
Appointment of this nature require the Chartered Accountant to work in Co-operation will solicitors or Lawyers. Conversely, Solicitors or lawyers carrying out works of this kind usually call in Chartered Accountants to assist them in the accounting aspects of their work.
Directorship
Many members of the Institute who hold senior position in industry and commerce are also directors of their companies. Moreover, many members who are actively carrying on public practice are also directors of companies. The advantages of having a Chartered Accountant on the Board of Directors are now well recognised and the practice of making such appointments has grown rapidly.
Companies Secretarial Work
In a well organised company or group of companies, the Secretary is a man with a professional qualification (often a Company Secretary) who, in addition to his multifarious other duties, is an important link in the management chain. The continued growth of limited companies enables the professional accountants to offer secretarial services to small companies, many of which are being virtually run by a few individuals who are unable to afford a full-time secretary.
Management Accounting
This is another field in which the Chartered Accountant is able to render a service which is utilised in a variety of ways like formulation of policies, day to day control, performance evaluation, etc.
Share Valuation Work
The Chartered Accountant undertakes the valuation of shares of public and private companies when amalgamation or re-organisation takes place for the purpose of takeover bids and other acquisitions.
Equity Research & Analysis
Chartered Accountants also work actively in the areas of Equity Research & Analysis. Equity Research involves preparing reports on background information on companies and their profitabiity, financial position. Analysis involves analysing the information and giving buy, sell or hold calls on the shares. Equity resarch analysis can be fundamental & technical or both.
Information System Audit
ICAI conducts DISA examination and the members who pass the examination can carry out system audits.
Faculty Support
Members of institute are best teachers in courses like Accountancy, Costing, Finance, Law, Taxation, Merger & Acquisition, Corporate Law & Governance etc.
ICAI Plans Global ICAI President plans to open ICAI's first oversea chapter in New York in order to provide opportunity to members of the Institute, based in other countries.[1]
[edit] Notable CA firms in India
- PricewaterhouseCoopers, Kolkata, New Delhi, Mumbai, Bangalore, Chennai (Madras)
- KPMG, Mumbai, New Delhi
- Manohar Chowdhry & Associates, Chennai, Bangalore, Hyderbad, Vizag, Mangalore, Cochin and Madurai
[edit] Accounting Standards Issued by ICAI
Till date The Institute of Chartered Accountants of India has issued 31 Accounting Standards (AS-1 to AS-31 in serial order Click here to view all Accounting Standards Issued by ICAI), out of which AS-8 is now not in force as the same is merged with AS-26. ICAI has set an internal deadline of aligning its Accounting Standards with IFRS by April 2011.
