Financial Daily from THE HINDU group of publications
Wednesday, Dec 25, 2002
Financial Daily from THE HINDU group of publications Wednesday, Dec 25, 2002 |
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Corporate
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Accounting Standards ICAI council may discuss Naresh Chandra proposals K.R. Srivats
NEW DELHI, Dec. 24 THE 30-member central council of the Institute of Chartered Accountants of India (ICAI) is likely to discuss the recommendations of the Naresh Chandra Committee report on Corporate Audit and Governance at its meeting beginning on December 26 at Nagpur. Sources pointed out that the Naresh Chandra Committee report, which was submitted to the Finance Minister on Monday, had significant ramifications for the future of the profession of chartered accountancy. The committee came up with certain contentious recommendations including the need for mandatory rotation of audit partners and not a statutory audit firm rotation — a move that has not found favour with some of the "corporate governance activists" of the country. Issues such as the proposed changes in disciplinary mechanism and the new appellate procedures might come up for discussion, sources said. In their three-day meeting, the council will take up four auditing and assurance standards for discussion and approval. These are 1) terms of audit engagement; 2) communication of audit matters to those charged with governance 3) auditor's report on financial statements and 4) auditing in a computerised info-systems environment. Sources said that the draft guidance note on accounting for mineral oil and natural gas producing activities was likely to be taken up for discussions and approval. The Naresh Chandra Committee has also suggested that ICAI should propose to the Government a regime and regulatory framework that encourages the consolidation and growth of Indian firms, in view of the international competition they face, especially with regard to non-audit services. It has also asked the Government to consider amending the Partnership Act to provide for partnerships with limited liability, especially for professions that do not allow their members to provide services as a corporate body.
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