Reducing pendency of complaints is priority: ICAI president Jambusaria

Govt has to balance between ease of doing biz and ensuring compliance, says Jambusaria

The Institute of Chartered Accountants of India (ICAI) is gearing up to push small audit firms to become globally competitive with fresh networking guidelines, legislative reforms and technical upgrades. ICAI’s new president Nihar N Jambusaria, in a conversation with Ruchika Chitravanshi, says reducing pendency of complaints is his priority. Edited excerpts:

What will be your main agenda as new ICAI president in the context of Covid stress in the economy and increased expectations from the audit and accounting profession?

A financial and tax literacy drive in the country, particularly for the micro, small and medium enterprises (MSMEs) – that often make mistakes out of ignorance – will be a big service not just to businessmen but also to those who are auditing the accounts. Post Covid, the expectations of the government and the society from CAs have enhanced. We plan to set up a group on public advocacy. At the enactment stage itself, we can point out the hurdles and suggest possible solutions. It will help the government frame laws that are user and economy friendly. Also, the manner in which robotics and data analytics are taking over, our members should be on top of technology as without it they cannot serve clients effectively.

The government is looking to amend various professional Acts to put in place better disciplinary mechanisms. What are the important changes required?  

We are in discussions with the government on the amendments. We are suggesting reforms related to election (of the council members), education and training. I don’t think substantial amendments are coming. For instance, we have proposed that the industrial training period be increased from 12 to 18 months and students be trained in government departments for more exposure. 

There is a lot of stress on ease of doing business with recent proposals such as no mandatory GST audit for companies. How do you think we can balance compliance with corporate governance?

 The government has to do some balancing between ease of doing business and ensure compliance with law. By doing away with GST audit, the risk of non-compliance will increase. When GST calculations are verified and certified by an auditor, there is an assurance that the taxpayer has complied with the law. This is a preventive care which is not avoidable.

There is criticism that complaints don’t get addressed timely. What is the status of complaints filed with the ICAI? 

We have a process. When a complaint comes, the director –discipline has to write to the respondent. Even if he finds that the member is not guilty, then also he has to frame a prima facie opinion and put it before the disciplinary committee. He cannot by-pass this process.

What steps would you take to make small audit firms capable of facing global competition from the likes of the Big Four?

We have just revised networking guidelines and passed multidisciplinary partnership rules. 

We are also looking at networking guidelines with foreign firms. All these will promote Indian firms and make them grow. We are not only doing it by passing regulations, but also by increasing awareness among the firms. We are making them aware of the benefits of having bigger set ups.