ICAI may allow tender work by chartered accountants

‘Whether chartered accountants (CAs) should be allowed to respond to tendering enquiries as part of their audit work was considered and debated by the ICAI council,’ Chandak said. After the ICAI council takes a formal decision, the code of conduct of the Chartered Accountants Act 1949 will have to be amended. This will be followed up by a ICAI guidance note on the subject.

According to Chandak, the ICAI council is evaluating the impact on competition and independence of CAs if tender work is allowed for CAs.

Based on the Sarbannes Oxale Act, ICAI has already made recommendations to DCA to secure independence of auditors. The suggestions relate to appointment, tenure, remuneration, and audit qualification. ICAI has said that the fixation of the remuneration following certain parameters should be stipulated in the CA Act itself, instead of leaving it to management decision as is done currently. The auditor’s qualification should be taken into consideration while determining the distributable profit for fixation of the directors’ remuneration and for declaration of dividend.

The ICAI council meeting also concentrated on disciplinary proceedings. “Nearly 60 cases in relation to disciplinary proceedings were taken up for consideration at various levels,” Chandak said. ICAI has finalised punishment in 10-12 cases of professional misconduct and has recommended them for action to the high court, Chandak said.