The Institute of Chartered The Institute of Chartered Accountants of IndiaAccountants of India

Established by an Act of Indian Parliament

“The Chartered Accountants Act, 1949”

AgendaAgenda• ICAI Mission• About ICAI• Central Council• ICAI Committees• Functions • ICAI – Key National Body• Education & Training

– New Scheme of Education & Training• Examinations• Accounting Standards • Auditing Standards• Research & CPE • Professional ethics• Professional Development• Peer Review• Financial Reporting Review• International Initiatives• New Initiatives

ICAI MissionICAI Mission

The Indian Accountancy Profession

will be the Valued Trustees of World Class Financial Competencies, Good

Governance and Competitiveness

The InstituteThe Institute• Established by the Chartered Accountants Act 1949• To regulate the profession of Accountancy• Education & Examination of Accountancy• Ensuring Standards of performance of Members

– Formulation of Accounting Standards– Prescription of Auditing & Assurance Standards– Laying down Ethical Standards– Continuing Professional Education– Financial Report Review– Monitoring quality through Peer Review– Conducting Post Qualification Courses

• Exercise Disciplinary Jurisdiction • Input on Policy matters to Government, Regulators

etc.

ICAI ProfileICAI ProfileParticulars No.ORGANIZATIONAL

Regional Offices 5Branches 108Chapters Abroad 15

SPECIAL PURPOSE OUTFITSCPE Study Circle 174CPE Chapters 48Reference Libraries 20Accredited Institutions 273

MEMBERSHIP (‘000) 130% in Practice 60%

STUDENTS (‘000) 300

INTERNATIONAL PRESENCE

Founder Member of IFAC, IASB, CAPA, SAFA, IIN

Indian Accountants Benchmarked Internationally - 5% of Members settled in more

than 50 big cities around the World

Dominant presence in UAE, USA, UK etc.

ICAI SpreadICAI SpreadChapters Abroad• Abu Dhabi• Bahrain • Doha• Dubai• Saudi Arabia (Eastern province)• Jeddah• Nairobi (Kenya)• Riyadh• Zambia• Botswana• London• Indonesia• Kuwait • Nigeria• Port Moresby (Papua New Guinea)Office in Dubai

Standing Non-S tanding

Comm ittees

Council

The Central CouncilThe Central Council• Consisting of 30 Members

– 24 Elected Members– 6 Nominated by Central Government

• Term: Three years• Headed by President

– Elected by the Council for One year Term• Empowered to frame Regulations under

the Act and to constitute necessary standing and non-standing Committees

Standing CommitteesStanding Committees

Examination Committee

Executive Committee

Disciplinary Committee

Imp. Non-Standing Imp. Non-Standing CommitteesCommittees

Committee on Ethical Standards

Comm. On Fin. Markets & Investors’ Protection

Fiscal Laws Committee

Accounting Standards

Board

Accounting & Assurance Standards

Board

Committee on Insurance

& Pension

Standards Interpretations

Committee

Expert Advisory

CommitteeResearch Committee

Board of Studies

Corporate & Allied Laws Committee

Information Technology Committee

Committee on Trade

Laws & WTO

Imp. Non-Standing Committees - 2Imp. Non-Standing Committees - 2

The Institute is responsive to the emerging challenges and constitutes new committees for effectively meeting these challenges

Research Unit: ICAI-Accounting Research Foundation

Professional Development Committee

Continuing Professional Education Committee

International Affairs

CommitteeAudit

Committee

Peer Review Board

Financial Reporting

Review Board

Committee on Members in Industry

Organisation StructureOrganisation Structure

DE P A R T M E N T S C O M M I T T E E S

S E C R E T A R Y T O T H E C O U N C I L(S e c re ta ry to the I ns titu te )

V I C E -P R E S I DE N T

P R E S I DE N T

.

E xa m in a tion D isc ip lin a ry

M & S S A /C . & F ina n ce

H R D , P & A C o u n c il

In te rn atio n a l A ffa irs

A d m in is tra tion

T e ch n ica l D ire c to ra te

B o ard o f S tud ies

C P E D ire c to ra te

Institute FunctionsInstitute Functions

Professional Development

AdvisoryRegulatory

ICAI – A Key National BodyICAI – A Key National BodyOffers inputs to• Comptroller & Auditor General of India• Ministry of Company Affairs, Govt. of India• Reserve Bank of India• Securities and Exchange Board of India • Central Board of Direct Taxes • Insurance Regulatory and Development

Authority• Departments of Central and State

Governments• Departments of Public Enterprises

Examples of Involvement of ICAI Examples of Involvement of ICAI in National Organisationsin National Organisations

• Drafting of Income Tax Laws• Drafting of Competition Law• Drafting of Company Law• Capital Market – Development and

Regulation• Corporate Governance• Accounting & Utilization of Governmental

resources• WTO & GATS• Import – Export Policy• Commercial and Economic Legislations• Non Banking Financial Companies

Education and TrainingEducation and Training• Distant Mode of Education• Education Through Accredited

Institutions and Branches• Meets the requirements of

international educational pronouncements of IFAC

• Comprehensive theoretical and practical curriculum

• Continuous review of the curriculum

Highlight of the New Scheme of Highlight of the New Scheme of Education & TrainingEducation & Training

I Common Proficiency Test– Compulsory

II 3½ years of Practical Training concurrent with components of Professional Competence Examination (PCE) and Final – Complete 100 hours of Compulsory Computer

Training before appearing for PCE.– Undergo General Management & Communication

Skills (GMCS) after 18 months of practical training and completion of PCE

– Eligible to appear for Final Examination on completion of 3 ½ years and passing of PCE

Highlight of the New SyllabusHighlight of the New SyllabusFinancial Reporting

– Corporate Financial Reporting– IFRS based Financial Reporting – US GAAP based Financial Reporting

Strategic Management– Study of Business Environment – Understanding Strategic Planning and Analysis – Ability to understand and formulate Functional Strategies

Financial ManagementAdvanced Management Accounting Information Technology and Systems Control Business Ethics

ExaminationExamination• One of the largest Accounting examination

networks • 120,000 students appear in the

examinations• Administrative conduct of examination and

exam related process largely computerised • Exams are held twice in a year• Examination system considered to be of

high standard & integrity worldwide• Has been lending expertise to accounting

bodies in other countries

Accounting StandardsAccounting Standards• Formulation through wider participation and

consultation • Harmonisation with International Standards

• Mechanism for issuance of interpretations • Ensuring effective implementation through

comprehensive framework

Accounting Standards IAS

Indian AS

In effective use 38 28 Under preparation   7 Irrelevant to India   2 Guidance Note issued 1  Total 38 38

Auditing StandardsAuditing Standards• For ensuring quality in audit process• Formulation through wider participation and

consultation• Harmonization with International Standards

• 40 Guidance Notes on other issues• Constant dialogue with authorities like C&AG, RBI• ICAI is consulted by IAASB on standard setting

Auditing Standards ISAsIndian AAS

AAS Issued so far 38 33Irrelevant to India   2 ISA yet to be considered   2 Total 38 38

Research and CPEResearch and CPE• Commitment to advancement of knowledge

in accountancy, auditing, taxation and allied areas

• Published about 150 Publications• Expert Opinions on Applicability of Standards• 20 Compendiums over 1000 opinions• More than 50 CPE materials published• 3000 CPE programs held annually• ICAI-ARF to promote research on

contemporary issues• Publishes a monthly journal with more than

175,000 circulation

Professional EthicsProfessional Ethics• Cardinal Principles

– Service before self– Extends beyond the legal requirements

• Some major highlights• Prohibition on other occupations• Prohibition on solicitation• Prohibition on advertisement and

Canvassing• Prohibition on financial interest• in auditee company• Restriction on number of audits

• Limit on fees for non-audit assignments

• Prohibition on writing Books of Accounts of Auditee company

• Demarcation between External and Internal Auditors

• Professional fees for audit and other services received by a firm not to exceed 40% of the gross annual fees of the firm

Professional DevelopmentProfessional Development• Identifying Role of Profession in

emerging areas• Developing Practice Areas• Upgrading and updating the

knowledge and skill sets• Developing technical material to

facilitate practice in new areas• Considered as critical in the changed

Scenario

Peer ReviewPeer Review• Peer Review Board established in

March 2002• Reviews by Board to ensure

– compliance with technical standards; and– existence, compliance and adherence to

quality control – policies and procedures

• Findings would not have any relationship with the disciplinary proceedings

Financial Reporting ReviewFinancial Reporting Review• Financial Reporting Review Board

constituted in 2002 to review general purpose financial statements of certain enterprises

• Board’s findings would form basis for :– initiating action against auditor concerned; and– informing irregularity to relevant regulatory

authority• Board seeks general purpose financial

statements of top 500 companies in India on yearly basis

International InitiativesInternational Initiatives• Extended support to ICAN and ICASL in

terms of focussed MOUs• Joint conferences organised with IFAC,

ICAEW, ICAP, ICASL, ICAN • SAFA adopted ICAI curriculum as model• ISA program launched in Sri Lanka• Student exchange programs held with ICAB,

ICAP, ICAN and ICASL• MOU with UAE for development of

Accounting Profession• MOU likely to be signed in near future with

Sultanate of Oman

International InitiativesInternational Initiatives• ICAI being consulted by IAASB in Audit

Standards Setting• ICAI represented in

– IFAC – Board Member, Education Standards Board, SMP Committee, Developing Nations Committee, International Public Sector Accounting Standards Board, Professional Accountants in Business Committee

– CAPA – Dy. President, Chairman, Strategic Committee

– SAFA - President, Permanent Secretary, Chairmen of various Committees and Working Groups

• Playing a lead role in the area of Developing Nations, SMPs and SMEs

New InitiativesNew Initiatives• Establishment of Accounting Standards

Interpretation Sub-Committee• Launched the Virtual Institute Project

providing e-services to members and students

• Cap on fee for rendering services other than audit

• Disciplinary mechanism framework• Amendments proposed in Act• Recast professional curriculum• Bridging the expectation gap

ICAI - Virtual InstituteICAI - Virtual Institute• ‘Virtual Institute’ integrates all the regions and

offices to present a unified view of the operations of the entire Institute through a single integrated enterprise system

• It FULFILLS the members and students right to convenience, comfort and make the benefits of Information Technology (IT) available to the members and students for rendering the Institute services online anywhere-anytime

• With this all operational functions of the institute have been brought onto a common intranet with seamless flow and availability of information

ICAI - Virtual Institute - 2ICAI - Virtual Institute - 2• Towards Tomorrow Today

– ICAI started IT initiative towards a bright future and is in it today

• ICAI Portal is effectively used to make a repository of information and knowledge accessible to the members, students and employees at the click of a button.

• The portal brings dynamic features to the content. It functions as a Global Gateway to ICAI. The portal’ provides a single interface to users for accessing Institute’s services taking into consideration security requirements.