Is there a need for an accounting institute along the lines of IITs and IIMs in India? A parliamentary committee suggested on Wednesday (March 23rd) that the establishment of such an institute would contribute to the development of the accounting and financial profession in the country, according to a PTI report. The Parliamentary Standing Finance Committee’s submission to the Lok Sabha is part of the wider report on the Chartered Accountants, Cost and Works Accountants and Company Secretaries (Amendment) Bill 2021, which has been tabled to Parliament last December by the Ministry of Corporate Affairs. The Committee argued for such institutions on the grounds that they would promote healthy competition, raise the level and quality of auditing and accounting, and improve the credibility of financial reporting. The bill proposes changes to the existing regulation of institutions of public accountants, public accountants and business accountants.
It also proposes changes to the appointment of members of the disciplinary committees of these establishments. The committee upheld the recommendations of the bill, which proposes a non-certified accountant (CA), a non-accountant accountant and a lay secretary as the chairperson of the respective graduate institute disciplinary committees.
In addition, the government has proposed that each committee should have three appointed members who are not from 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 how to constitute the committee of discipline. The Institute of Company Secretaries of India was of the view that the parameters for selection of chairman and members of disciplinary committees and such restrictions should be specified by rules rather than regulations.
“The committee believes that while the autonomy and independence of professional institutes should not be unnecessarily impaired, the integrity associated with financial reporting cannot in any way be diminished, as it reflects commercial standards and the soundness financial situation of the whole country,” the panel said. .
The coordination committee of the three institutions must also be reviewed, the panel said, adding that it could act as the supreme body for the “smooth regulation” and professional development of the three institutes. He suggested that it be chaired by a prominent figure in industry, finance or business who is not a member of any of the three institutes in question. The bill proposes that the secretary of the Ministry of Corporate Affairs chair the coordinating committee and represent the government.