Brief description of chartered accountancy

A member of one of the institutes of accountants granted a royal charter.

Chartered Accountant (CA) is the title of members of a certain professional accountancy associations in the Commonwealth countries and Ireland. The term chartered refers to the charter under which these bodies were incorporated. Subjects examined include financial accounting, management accounting, auditing, taxation and company law.

Chartered Accountants work in all fields of business and finance. Some are engaged in public practice work, others work in the private sector and some are employed by government bodies.

Professional designation for British accountant. To be one, a candidate must pass rigorous examinations, as CPAs must do in the United States.

Recognition given by the chartered institutes in present and former British Commonwealth countries including Australia, Canada, India, New Zealand, Nigeria, Pakistan, South Africa, and the United Kingdom to individuals meeting examination and practical experience requirements. The chartered accountant is authorized to render an audit opinion on a company's financial statements.

History :

In India, the profession of chartered accountancy is regulated by the Institute of Chartered Accountants of India which was set up under the Chartered Accountants Act of 1949. The ICAI is self-regulatory and is both, an examining as well as a licensing body.

Members are awarded the ACA(Associate Chartered Accountant) or FCA (Fellow Chartered Accountant) designations. A member will be called a FCA after 5 years of practice.

The Chartered Accountants Act, 1949 was passed on 1st May. The term Chartered Accountant came to be used in place of Indian Registered Accountants. So the term "Chartered" does not relate to Royal Charter as in case in UK or Australia as there is no Royal Charter in Republic of India.

A person shall be admitted as a member of the ICAI after completion of 3 and a half years of articleship training (apprenticeship) and the passing of the CPT (Common Proficiency Test), PCE and Final examinations along with Computer Training and IT Certification Course.

Statutory Audit under the Companies Act, 1956 and Tax Audit under the Income-Tax Act, 1961 can be carried out only by Chartered Accountants holding a Certificate of Practice.

The ICAI has also entered into Mutual Recognition Agreements with several overseas accounting bodies. e.g. the CECA with Singapore. The institute is in process for opening up with various other countries and governments.

Chartered Accountancy is a much sought after course in India and is considered to be quite prestigious.

Chartered Accountancy course holds high social and professional repute in India and is usually the First Choice for students from the commerce field and hence attracts the best of the talent in the country.

The examinations are very rigorous with very low pass rates. The course involves a blend of theoretical education and practical training which run concurrently for a period of three years and equips a student with knowledge, ability, skills and other qualities required of a professional accountant.

The three and a half years training is the longest in any professional course and it also gives the student a choice of opting Industrial Training in the last year of the training.

The craze for CA Profession is also fuelled by the fact that a fresh Chartered Accountant in India, earns at least three times then an average MBA or other professional course on finance & accounts.

With Regards

CA Ravi Sisodia