Page 9 - A Position Paper on Regulation of Accountancy Profession and Oversight Mechanism in India

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Chapter 1

Evolution of Accountancy Profession in India

1.1 Birth of ICAI–Constituent Assembly deliberations Evolution of Accountancy Profession in India

(i) It is important to empathise that carte blanche of ubiquitous nature which is discernible
for the Chartered Accountancy profession has been due to path of rectitude that the
Chartered Accountancy profession has all through followed in its journey of support to
Indian Industry, and Economy. It also in tandem with the consecrated ordainment that
was fervidly put forth in the constituent Assembly debates; quoting from the History of
the Accountancy Profession in India, Volume I, by Shri G. P. Kapadia:

“No profession can aspire to progress unless it has a vision and sets service to the
community as its objective. It has also to be free from restraints and allow for the
economic advancement of its entire membership. Its resilience and practice to respond to
the changing situation and growing demands on it will determine its continued existence
and growth. Technical excellence in the performance of its functions and observance of
the highest in professional ethics constitutes the foundation on which its future can be
built up.”

(ii) It sums up the expectation and the roadmap from the Chartered Accountancy
profession in all times to come. Equally apt is to point out the speech made by Shri C D
Deshmukh, Hon’ble Finance Minister, Government of India at the 2nd Council Meeting
of the Institute held on 11th August, 1951.(Source: History of Accountancy Profession–
Volume I)

The practice of accountancy is in the nature of a public service. Apart from the statutory
responsibilities to report on the accounts to the shareholders, it is the duty of every
member of the Institute to ensure that he fulfils the high ideals set before him amidst
all the pressures and temptations of the day. I am glad to know from your address that
you are fully alive to your responsibilities. It is only the watchful eyes of the members of
your profession which can make any measures that Government may take to curb mal-
practices in trade and business, really effective.

You have referred to the moral standard of the accountancy profession. I welcome your
assurance that the deterioration of standards in this profession is certainly not of that
aggravated character which may be found elsewhere as a result of the war conditions. I
trust you will not misunderstand me if I utter a word of warning against complacency in
this respect. It is essential to be ceaselessly vigilant about this, all the more so because
of the greatly enlarged sphere of your activities. The Institute of Chartered Accountants
should continue to exercise unceasing vigilance in seeing that its members conform to
the traditions and conventions of the profession and that the rules framed by them are

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