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Dear Esteemed Colleagues,
Change is the only thing that is constant. It is this continuity of change — change with the times that has kept our profession in a leading position in India for decades. As has been well said, ‘continuity gives us roots; change gives us branches, letting us stretch and grow and reach new heights’. It is time for change at the Institute too — a change of guard at the very top. Yes, this is my last message to you as the President of the Institute.

And as I write this, the nation and our profession are grappling with India’s largest-ever corporate fraud of over Rs. 7,000 crores committed at country’s fourth largest IT firm, Satyam, by cooking up the company’s books for years to inflate profit and revenue figures. The irregularities in this high profile con-job have come as a rude shock to the Institute, indeed to the entire accountancy profession and the society at large. The resultant furore and backlash against regulators and auditors is only natural. But, looking to the facts so far, it doesn’t seem to be a case of a systemic failure, but is more in the nature of an individual aberration. I can only say that we as a professional body are as keen as any one else to get to the bottom of things and the Institute as the regulator of the auditing profession will do everything which is expected of it.

Friends, there is a wrong impression in certain quarters that the Institute is slow in taking deterrent action against defaulting members. On the contrary, the Institute has been most prompt in taking punitive action against its errant members. In fact we have been most stern in punishing members for any violation of the code of conduct. An idea of how severe the Institute can be had from the fact that in the last three years itself, it has awarded punishment to more than 100 members. The Institute has painstakingly tried to ensure adherence to a code of conduct by all its members. Let me reassure you that I and my colleagues in the Council are committed to keep that track record unblemished by giving exemplary punishment to all those who may be found guilty in the Satyam episode after expeditious investigations. We have initiated a range of steps and have embarked on extensive and timebound investigations, in sync with a concerted drive by various Government agencies and regulators to bring the guilty to book. Our first and foremost task, I need hardly say, is to restore and sustain con- fidence of the society in our profession.

Our credibility is at stake. It’s time for all our members to be extra-vigilant while delivering our services and performing our duties, particularly in the backdrop of Satyam fiasco, which might change the relationship between the auditors and the managements in the years to come. We need to re-prove our worth as the backbone of Indian financial system and justify the epithet of being the ‘conscience keeper’ of Indian economy.

The Satyam fraud is a wake-up call to all members to meet the biggest challenge posed to the profession. The society expects that the financial state- ments once certified by the auditors are true and can be taken at their face value and we must all endeavour to restore that faith in the profession.

Training to Articled Assistants
The present troubled times also bring into focus the strong need for quality article training, which is the key to a strong accountancy profession. In these times of high expectations, globalization and the fast-increasing number of articled assistants, the practical training of articled assistants has to be taken far more seriously than ever before in order to maintain high standards of probity and excellence. It’s high time that members/principals rose to the occasion and gave extra attention to groom the CA students who work with them into complete professionals of integrity and ethics. Members need to act like mentors, as ‘friend, philoso- pher and guide’ to the CA students and give them the best training they can. The practical training needs to be meticulously planned and implemented in such a manner that the trainees get exposed to a variety of professional activities, circumstances and business environments.

Let me now share with you some of the other major developments pertaining to our profession over the last one month.

MoU with CPA Australia Recognizing Each Other’s Qualifications
All through my tenure my earnest endeavour has been to ensure that the international presence of ICAI and Indian Chartered Accountant is more widespread and strong. You would recall that in the month of November, 2008, we had signed a historic MoU with ICAEW recognizing each other’s qualifications. Now an MRA with CPA Australia has also been finalized and by the time this issue of the Journal reaches you, the same would have been signed.

As per the Memorandum of Understanding reached, members of ICAI who are graduates will be eligible for CPA Australia membership on passing one paper on Business Strategy & Leadership. On the other hand, members of CPA Australia will be eligible for ICAI membership subject to passing two papers on Corporate and Allied Laws and Taxation and two more papers on Advanced Auditing and Professional Ethics and Financial Reporting, if they have not already passed them as part of the CPA Australia programme.

This MRA will open professional opportunities to our members in Australia and this will bring the two countries, India and Australia, closer. Let me further inform you that discussions are on with other Institutes of the world, particularly in Canada, Singapore, CA Australia, Ireland and Scotland and I am quite confident that very soon, we should be in a position to have similar MRAs with many more countries.

As part of our effort to popu l ari ze Indian CA qualification in countries of interest to Indian accounting profession, ICAI’s proposals for the institutionalization of the accountancy profession have been well received by Papua New Guinea and the Republic of Djbouti and are under active consideration for development of IS Audit standards

However, some other important tasks on my inter- national agenda have remained unfinished. These include formation of Chapters of the Institute at Thailand, Hong Kong, Tanzania and Auckland, but necessary processes for these are on. The project of the ‘compilation of a directory of foreign mem- bers’ and the institution of the Best Chapter Award are also in progress.

The Institute’s Gift of a Free Accounting Software
Friends, ours is an accounting Institute and I have always wondered what is the best gift that an ac- counting Institute like ours could give to the world. Accordingly, I conceived the idea of giving accounting software to the world that can be downloaded by anyone anywhere absolutely free of cost. Being an accounting Institute, it is our responsibility to make available all tools that are required in account ing and auditing. I am glad that we have been able to develop the first version of such accounting software. It has been officially launched and is now freely downloadable from the ICAI website by any user. The software is the first of its kind. It is a web based, easy to use, with the help of which the end users will be able to maintain their accounts online. It can operate as a single user license on a desktop computer for a small timer. If deployed on a web server, it can meet the financial accounting requirements of the corporate sector as well.

The initial version of the software will contain core modules. This software will also serve households that use accounts payable type accounting transactions, managing budgets and simple account rec- onciliation. Our accounting software would be dif- ferent from other accounting softwares, as it will be web-based, that will offer the facility of viewing of accounts online from anywhere/ anytime and hav- ing accounts in any currency of the world.

The Institute will be releasing advanced versions of the software from time to time and in due course it will ultimately meet even the most complex and ex- pensive business accounting software requirements which are normally a part of an extensive suite of software often known as Enterprise Resource Planning or ERP software.

I may add that work on developing free download- able auditing software for small and medium practitioners is also on and we should be in a position to launch it soon.

Accountancy Museum
You would recall that I had envisaged an accoun- tancy museum with a rare collection of objects of historic and heritage value from the point of view of the accountancy profession in India. Today, I am delighted to inform you that this museum is ready, and will be open for all of you by the time you read this issue.

The museum presents rare and historic images (evidence of the oldest balance sheet in human civilization), and documentary evidence of the evolution of accountancy in India. The items on display include the minutes of Indian Accountancy Board (responsible for the birth of the Institute), first gold medals of R.A. final and CA final examinations, first annual report of the Council, our own first balance sheet, rare photographs and so on. It will also showcase very unique images including documents that have been acquired from the British Museum, London, and other private collectors from India as well as abroad. I am sure this mu- seum will serve as a great source of learning, inspiration and professional pride for all of us.

Digital Library
I am happy to inform that all the five Regional Council Libraries and the Central Council Library of the Institute have been brought on an ‘Enterprise Library Software’, facilitating access to all libraries simultaneously. This facility will also provide links to online journals, e-books, articles from The Chartered Accountant journal, library security deposit rules, library services for members & students, photographs available in the library, recent additions and SAFA books & publications available in the library and much more. Log-in facility for members and students will provide search and access to user account with the additional facilities like alerts etc. It will also facilitate easy and speedy correspondence with the library on a regular basis. This e-Library is accessible from e-Library link hosted on www.icai.org.

Portal for Members
With a view to facilitate better networking among practicing members and to ensure optimum utilization of their services and expertise, an exclusive portal has been launched for them wherein the practicing members can offer one area of their service that may be availed of by other practicing members. The portal will cater to both the overburdened members who are looking for specialized helping hands among our fraternity as well as those who are looking for professional opportunities. This portal offers an easily accessible and mutually beneficial contact point for the entire CA community. I foresee a great boost in networking and professional opportunities for members in practice through this portal. Let’s remember that ‘coming together is a beginning, staying together is progress, and working together is success’.

Centres of Excellence
In my first communication to you in the March, 2008 issue, I had shared with you my dream of having Centres of Excellence throughout the country to make the CA ‘a world class, matchless professional’. I am happy to say that as part of that drive, a Centre of Excellence in Hyderabad is being inaugurated later this month i.e. on 31st January, 2009. This will be a Centre of Excellence with a difference and it will offer residential courses and programmes for members, particularly the senior ones, with a view to transforming them into the best available, multi-dimensional professionals. This Centre will offer opportunity to members, both in practice and industry, to enhance their competitive competence and communication skills as well as their practical skills and professional and leadership abilities.

You will be happy to know that work on Centre of Excellence in Jaipur is continuing apace. Further, we have also acquired land for a Centre of Excellence in Bangalore.

Convergence with International Ethical Standards
As part of our drive to continue to benchmark ourselves against the best available global practices and explore the tremendous opportunities on the hori- zon, we have adopted a new Code of Ethics which is in line with the IFAC Code of Ethics. I am sure this move will go a long way in boosting the stature and brand of Indian CAs and help in his/her transformation into a ‘Global Chartered Accountant’. Across the world, it will also help showcase Indian accountancy profession at a higher pedestal of professional excellence. In a related move, our Committee on Ethical Standards has been reoriented and reorganized as ‘Ethical Standards Board’ to facilitate greater transparency and participation of other stakeholders – ministries, regulators etc, in the relevant standard-setting process.

Examination Results Set Welcome Trends
The results of Common Proficiency Test (Dec.2008) and Chartered Accountancy Final Examination (Nov. 2008) have been excellent and have set some welcome new trends.

A total of 34,251 students (38.37%), including 11,588 girls cleared the CPT out of a total of 89,253 who appeared for it. The analysis of CPT results over the years shows that since 14th September, 2006 when the new scheme of CPT was introduced, within a period of about 27 months, about 3.8 lakh students have opted for CA Course out of which more than 1.55 lakh students have passed the CPT examination. Thus, there has been a substantial increase in number of students as compared to years 2001-2005 when an average of 35,000 students used to get enrolled for articleship. There is also an increase in the number of girl students opting for CA course — 30.96% (27,637) of total 89,253 students who took the latest CPT were girls. Moreover, the performance of girls has also been better than that of boys with an impressive pass percentage of 42% as against 37% of their male counterparts.

In the CA Final examination, 20.27% (2961) of 14,606 students who appeared for both groups have passed while 18.76% of a total of 6588 students cleared Group I and 21.13% of a total 9235 have passed Group II. A welcome trend is that there has been an increase of more than 25% in the number of students appearing for the Final examination as compared to November, 2007. The percentage of female students too has continued to rise over a period of time. Out of total 30,399 students that appeared for Group-1, Group-II & Both Groups in November, 2008, the number of female students was 7189, i.e., 23.64% of the total students as compared to 23.04% in May, 2008. Not only that, female students also continue to excel in their performance in CA examination and they have bagged two out of the first five positions.

I congratulate all those who have passed the examination. My special compliments to the rank holders.

Initiatives for Students
You would appreciate that all through my tenure, I have tried to ensure that CA students and their welfare get special attention in ICAI’s overall scheme of things and they are provided with an enabling environment that helps them not only in their ac- ademic pursuits but in the development of their overall personality as well. As part of that mission, it has been decided to develop sports/gymnasium and health check-up facilities for students at every branch of ICAI. This, I am sure, will prove to be very beneficial to them. The facilities so developed can also be made available to members as is being done for computer labs.

Further, with a view to giving a distinct identity to CA students and to inculcate a sense of belonging among them, it has been decided to give a face- lift to the dress prescribed for them. Now, CA students will be encouraged to wear a blazer of a colour slightly different from the blue recommend- ed for members with a prescribed lapel pin sported thereon. The lapel pins, whose photographs were published in January, 2009 issue of the journal, have been made available at all the decentralized offices of ICAI and are meant to be given free to the students at the time of their registration itself.

I Bid Adieu…
Friends, as I prepare to pass the baton of ICAI leadership on to my successor, I can modestly say that many of my initiatives have borne fruit. You will, I hope, agree that ICAI is today a more robust, developed, energetic and futuristic organization. I am happy to recall that during the year when I had the privilege of leading the onward march of ICAI, it has not only grown bigger and better but has also paved the way for a brighter tomorrow for the profession. Barring the unfortunate Satyam episode, there has been a phenomenal rise in the status, prestige and image of ICAI in the public eye.

When I took over the reins of the ICAI, I had a mission within the ultimate vision of excellence and I am proud to say that we have accomplished most of that mission. ICAI has hit several milestones and overcome several challenges with the spirit of a true partner in nation building. Friends, I have tried to go faster, and have tried to speed things up.

When I look at the infrastructure, the Centres of Excellence at Hyderabad, Jaipur and Bangalore are taking shape, whereas the process of acquisition of land for Centres of Excellence at Guwahati, Mussoorie, Chennai, Noida and Ernakulam is going on.

The branches are the extended arms of the Institute and in order to strengthen these branches a number of steps have been taken to ensure better infrastructure. Out of total 118 branches, 63 branches have their own buildings; construction is on at 14 branches; and the process of acquiring land is on in at least 18 branches. Further, each of the branches is being provided with a generator set. Seventy-three of them have their own websites. Six overseas chapters also have their own websites. The e-mail facility that was started during this year has been made use of by more than 58,000 members and students.

During the year, as many as 111 branches and 4 Chapters have got their own computer labs besides 16 computer labs at regional headquarters for imparting top rate information technology training to students as well as members. At the same time, the process of setting up more computer labs and expanding the capacity of the existing labs and starting the advanced information technology training for final course students is on. These labs, besides imparting training to the students and to members who are not computer savvy, have also helped in conducting the on-line examination for CPT. Now the plan is to hold CPT examination on-line every month starting from the month of March, 2009.

The three-month residential programmes for students have been started at Faridabad and at Jaipur, but, as indicated above, the Institute will soon be in a position to start this programme at other places also including at IIM Indore.

The Board of Studies has been expanded and subject-wise departments have started working. My desire was to bring it to completion during my tenure, but because of the delay in the construction of the Noida building, it is likely to take another six months. I am hopeful that this process will be completed next year and we will be in a position to have a full-fledged Board of Studies having specialized wings for each of the subjects.

The launch of Accounting Technician Course and granting Accounting Technician certificates to students who could not pass the CA final examination, conducting examination on alternate days to make examination schedules less stressful for students, and holding convocations to help forge a bond of camaraderie among new members were some of the new initiatives which we were able to accomplish during this year.

In tune with the emerging requirements of globalized economy and the need for specialized pro- fessionals and also as a futuristic move, we have been able to start 10 certificate courses in various spheres this year. The response of the members to each of these courses has been very encouraging. I am quite confident, that over a period, the Institute will be in a position not only to run all these courses in all major cities, but also come out with many more certificate courses.

To ensure that the students that we produce have an all-round development, various initiatives were taken during the year by organizing extra curricular activities. These include the National Debate competition, National Sports competition, National Cultural competition and creating health awareness. Many more of such activities need to be started for the all-round development of the students.

Similar activities for members have helped in creating a bond not only among them, but among their families as well. This year 2008-09 which is being celebrated as the Diamond Jubilee Year, a special focus was put on reaching out to the society and many initiatives were taken including a host of programmes. As part of this effort, the Institute was able to invite the top leadership of the country like the Hon’ble Prime Minister, Hon’ble Corporate Affairs Minister, Hon’ble Finance Minister, Hon’ble Deputy Chairman, Rajya Sabha and a host of Governors, Union Ministers, Chief Ministers and other dignitaries. Besides, we launched ICAI National Service Scheme to contribute our mite to socially relevant areas and to bring the profession much closer to the society.

Besides, as part of our social responsibility, we made significant progress in giving our support to the Government, both Central and State, in public finance and Government accounting. I am confident that in the years to come, our core competence in these areas will go a long way in ensuring better management of public finances and improv- ing transparency in Government accounting.

An area which is very close to my heart is the creation of professional avenues and opportunities for members who have qualified the ISA course. I must admit that despite my best efforts, much progress could not be made except the signing of MoU with ISACA. This, I believe, will help complete this process. But we need to do a lot more here, which include providing hands-on experience in a live environment with the service users. There is also a need to bring close proximity between such qualified members and users of ISA service.

As the premier accounting Institute, it is our responsibility to carry out research on accounting and related subjects. Though some initiatives were taken in this direction during the year, I must admit that the progress has not been as much as I wanted it to be. There is an urgent need to identify research scholars and encourage them to work in the area. ICAI needs to come out with research documentation one after the other so that it becomes one of the leading institutions in fundamental research. We also need to do research in teaching accountancy and related subjects through distance education.

On the front of creating a sense of belonging and making the CA fraternity a close knit family, various steps were taken during the year. These include increased com- munication by providing e-mail facility, improved website, updated information and improved on-line payment system. These efforts have certainly helped in bringing back many of those members who have not renewed their membership but there are still a large number of persons, who were members at one time, but have not renewed membership. We need to do a lot more on this account so that we can say with pride that each person who has qualified as a Chartered Accountant from this Institute is a member of the Institute. Besides, there is still a lot of scope in improving the behav- ioural response in the service to be provided by the Institute to its members and the students.

I believe that with every rising sun, you rejoice at a journey that has begun. And with every setting sun you rejoice at the victories that you have achieved and the paths that you paved for victories the next day. We have indeed come a long way, but I must admit that I have not been able to accomplish as much as I wanted to. There are still miles to go, still many more promises to keep. As such, these accomplishments cannot be final. The pursuit of ultimate excellence is an ever-going journey for the Institute and the profession. I am sure my successors will not only finish the unfinished agenda but also take up new ones, set new goals, make fresh starts in newer areas and achieve newer milestones in times to come.

Friends, all this would not have been possible without the active support of my colleagues in the Central Council, Regional Councils , branches and officers and staff of ICAI, who, more often than not, have burnt midnight oil with me, sometime working as late as 3 AM. I humbly and sincerely thank all of them. I also express my gratitude towards past presidents and other well wishers for their encour- agement and support.

As I sign off as President of ICAI, I feel overwhelmed by the affection showered on me and the confidence reposed by all of you in me. This has been the source of my strength and has energized me to work aggressively for the cause of the profession. And it has earned for me a unique rela- tionship with all of you and with all our students, something that I will cherish for the rest of my life.

Adieu!

CA. Ved Jain
New Delhi, January 27, 2009


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