The Hindu Business Line : Bank audits could vanish into thin air

THE world never seems to be kind to accountants, more so in India, if one were to consider a few grim predictions. Such as that bank audits could evaporate, as also the audit assignments that are currently coordinated by the C&AG. Five more auditing standards could roll out of the ICAI stable and, most important of all, the big boys in the game are ganging up globally.

These and more such `bad news' came from Mr Ashok Chandak, the president of the Institute of Chartered Accountants of India (ICAI), when he addressed the delegates on the opening day of the two-day regional conference organised by the Southern India Regional Council (SIRC) of the Institute.

The ICAI's Web site hosts a press release that talks about the inauguration of the 16th World Congress of Accountants in Hong Kong, a few weeks back, when the Premier of the State Council of China, Zhu Rongji made a pledge to build his country's accounting profession on a platform of strong professional ethics. And that the Chinese Government had attached great importance to the development of the country's accounting profession, and had made unremitting efforts in the building of the accounting system, the making of audit rules and the training of professionals. The Hong Kong Society of Accountants (HKSA) had hosted the four-day congress that attracted over 5,000 delegates from close to 100 countries.

But, a development that has not attracted much media attention, is what Mr Chandak was emphasising when he spoke about the global level `coming together' - of six professional bodies agreeing to accord mutual recognition to one another. These were the American Institute of Certified Public Accountants (AICPA), the Institute of Chartered Accountants in England and Wales (ICAEW), the Canadian Institute of CAs, the Institute of Chartered Accountants in Australia, the Institute of Chartered Accountants of New Zealand, and the HKSA. The arrangement that was struck on the sidelines of the World Congress, warns Mr Chandak, could lead to more than half a million accountants who are too mobile. What was not said was that it would now be open to the bodies that are left out of the elite club to think of forming a bloc of the `developing'. A new strain of apartheid, one might say, with an accounting twist.

A consequence of the ongoing privatisation programme, according to Mr Chandak, could be the vanishing of the audit jobs that are coordinated by the Comptroller and Auditor General of India (C&AG). Similarly, and more threateningly, there could be a vaporisation of the thousands of bank audits in the current format when banks get privatised.

But, don't lose heart, he cheered them, as is demanded when addressing an inaugural. Because, ethical values of the Indian CAs is `valued globally'.

Because accounting is a profession with a `bright future'. And because even if others could remain unemployed in the country, an accountant will `always find a job'.

If all that did not assuage fears, there was the ultimate sop from Mr Chandak: that the results of peer review would not be considered as `information' by the ICAI for the purpose of disciplinary proceedings.

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