Separate institutes for Accounting courses will develop the profession: Parliamentary panel

Is there a need for an institute for Accounting along the lines of IITs and IIMs in India? A parliamentary panel suggested on Wednesday, March 23, that the setting up of such an institute would contribute to the development of the accounting and finance profession in the country, according to a report by PTI. The Parliamentary Standing Committee on Finance's submission in the Lok Sabha is a part of the larger report on 'The Chartered Accountants, the Cost and Works Accountants and the Company Secretaries (Amendment) Bill, 2021', which was introduced in the Parliament last December by the Corporate Affairs Ministry. The Committee advocated for such institutions on grounds that it would promote healthy competition, raise the standard and quality of auditing and accounting and improve the credibility of financial reporting. The Bill proposes changes to the existing regulations of the institutions of chartered accountants, cost accountants and company accountants. 

It also proposes changes to the appointment of members of the disciplinary committees of these institutions. The Committee stood by the recommendations of the Bill, which proposes a non-Chartered Accountant (CA), non-cost accountant and non-company secretary as the presiding officer of the disciplinary committees of the respective apex institutes.

Besides, the government has proposed that each committee should have three nominated members who are not a part of the particular institute concerned. The Institute of Chartered Accountants of India had raised concerns about the proposal, while the Institute of Cost Accountants of India told the panel that it had no reservations about the manner of constituting the disciplinary committee. The Institute of Company Secretaries of India was of the view that parameters for selecting the presiding officer and members of disciplinary committees and such restrictions should be specified through rules rather than through regulations.

"The committee feels that while the autonomy and independence of the professional institutes should not be interfered with unnecessarily, the integrity associated with financial reporting cannot be diminished in any way since it reflects business standards and financial robustness for the entire country," the panel said.

The Coordination Committee of the three institutions also needs to be reviewed, said the panel, adding that it could act as the apex body for "harmonious regulation" and professional development of the three institutes. It suggested that it be chaired by an eminent person from industry, finance or business who is not a member of any of the three institutes in question. The Bill has proposed that the Secretary of the Ministry of Corporate Affairs would chair the coordination committee, and represent the government.