Familiarise with newer global areas: FM Nirmala Sitharaman to CAs

Union Finance Minister Nirmala Sitharaman on Thursday asked chartered accountants (CAs) to familiarise themselves with global developments, such as carbon accounting, to better advise clients.

She also asked the CAs to use digitisation as an opportunity to build public trust in companies.

“India and its new economy is being driven by startups and industry, which is transitioning to new ways of doing things…It requires hand-holding your clients. This will happen only if you are on top of technology yourself,” Sitharaman said at the national CA conference in Bhubaneshwar.

The finance minister said the Institute of Chartered Accountants of India (ICAI) might want to set up newer standards, best practices, and template for others to follow for each of the newer global areas. These include carbon accounting, corporate social responsibility accounting, and auditing along with due diligence related to environment, social, and governance (ESG) norms.

“Now due diligence is required by your clients for even negotiating for the transfer of technology for funds and negotiating with partnerships…The new course (by ICAI), which has been planned to be implemented from July 1 next year, is of critical relevance,” Sitharaman said.

Praising the transparency brought by digitisation, Sitharaman said it had helped in building trust not just between the company and its bookkeeper but also among the public.

On the use of technology and generative artificial intelligence, Sitharaman said: “The traditional image of accounting as a manual and tedious process is rapidly evolving; and for your good.”

She said the ICAI had also played an important role in the smooth roll-out of the goods and service tax and made a difference in widening the tax base. 

The FM said ICAI’s new course was very much in line with the national education policy (NEP). “The focus is more on how to learn rather than what to learn. The NEP gives the creative instinct to learning.  It is not about what to think but how to think… How will it matter more when you have to advise your clients,” she added.

Sitharaman also advised the ICAI to leverage its memoranda of understanding with various countries and strive for greater collaborations.