History And Significant Events of ICAI

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1888 - The Institute of Chartered Accountants in Ireland (ICAI), founded in 1888, looks after the interests of chartered accountants in Northern Ireland and the Republic of Ireland, and its qualification. is accepted worldwide. About 40 per cent of the membership work in public practice, while the remainder are employed in finance, industry and commerce.

1857 - The first ever Companies Act in India legislated.

1866 - Law relating to maintenance of accounts and audit thereof introduced. Formal qualification as auditor now required.

1913 - New Companies Act enacted. Books of accounts to be maintained specified. Formal qualification to act as auditor named. A Certificate from the local government to be held in order to act as auditor. An unrestricted Certificate entitled a person to act as auditor throughout British India. A Restricted Certificate entitled him to act as auditor only within the Province concerned and in the languages specified in the certificate.

1918 - Government Diploma in Accounting (GDA) launched in Bombay. On completion of articleship of three years under an approved accountant and passing the Qualifying Examination the candidate would become eligible for the grant of an Unrestricted Certificate.

1920 - The issue of Restricted Certificates discontinued.

1927 - Society of Auditors founded in Madras.

1930 - Register of Accountants (RA) to be maintained by the Government of India to exercise control over the members in practice. Those whose names found entry here were called Registered Accountants (RA).

1930 - The Governor General in Council replaced the local government as the statutory authority to grant certificates to persons entitling them to act as auditors.
Auditors allowed to practice throughout India

1932 - First Accountancy Board formed. The Board was to advise the Governor General in Council on matters relating to accountancy and to assist him in maintaining standards of qualification and conduct required of auditors.

1933 - First examination held by the Indian Accountancy Board. GDAs exempted from taking the test.

1935 - The first Final Examination was held. GDAs exempted from taking the test.

1943 - GDA abolished.

1948 - Expert Committee formed to examine the scheme of an autonomous association of accountants in India.

Jul 1, 1949 -The Institute of Chartered Accountants of India ( ICAI) was setup by the Parliament of India on 1st July 1949. The main purpose of ICAI is to regulate the profession of Chartered Accountancy and impart education. Activities of the ICAI extend to research in varied financial fields and setting standards of accounting and auditing to be followed by Industry. The profession of Chartered Accountancy is recognized world over not only in fields of accountancy and auditing but in taxation, financial management, business consultancy, system development and so on. ICAI provides quality education and finest practical exposure to its students through its study modules, competitive examination and rigorous training programs maintaining the old Guru – Shishya Parampara. It is the only self financing professional education course, therefore, within reach of rich and poor.

Jul 1, 1949 - In Indian context, the Institute of Chartered Accountants of India (ICAI) constituted an Accounting Standards Board on 21st April, 1977

2001 - THE Accounting Standards Board of the Institute of Chartered Accountants of India (ICAI) has issued an exposure draft of the proposed accounting standard on `Accounting for investments in associates in consolidated financial statements'.

The objective of this proposed accounting standard is to set out principles and procedures for recognising, in the consolidated financial statements, the effects of investments in associates on the financial position and operating results of a group.

A statement issued by ICAI said that an `associate' has been defined in the exposure draft as an enterprise in which the investor has significant influence and which is neither a subsidiary nor a joint venture of the investor.

The exposure draft also proposes that an investment in an associate should be accounted for in consolidated financial statements under the equity method subject to certain exceptions.

THE Central Council of the Institute of Chartered Accountants of India (ICAI) has cleared a new accounting standard on `accounting for taxes on income'.

"This accounting standard will be mandatory in nature and will come into effect in respect of accounting periods commencing from April 1, 2001," Mr N.D.Gupta, ICAI President, told Business Line.

The objective of the accounting standard is to prescribe the accounting treatment for taxes on income. Taxes on income are one of the significant items in a statement of profit and loss of an enterprise.

Mr Gupta also said that the Council, which met during April 27-30, has finalised a guidance note on `Corporate Governance'.

"The listing agreement with the stock exchanges requires chartered accountants to certify compliance of corporate governance practices. We have now finalised a guidance note for our members in this regard", he said.

May 16, 2007 - There was a bar by the ICAI - the apex Indian body for Chartered Accountancy from pursuing or joining INDIAN CFA of Icfai university, After nearly two decades, the ICFAI (Institute of Chartered Financial Analysts of India) has won the 'chartered' row against the ICAI (Institute of Chartered Accountants of India). In a decision dated May 16, 2007, the court ruled in favour of ICFAI, by setting aside an earlier verdict of the Andhra Pradesh High Court, which had allowed the ICAI to prohibit its members from using the descripttion 'Chartered Financial Analyst' or its abbreviation CFA.

November 2008 - The Institute of Chartered Accountants of India (ICAI) and CPA Australia Ltd. have signed a Mutual Recognition Agreement (MRA) to recognize the qualification, training of each other and admit the members in good standing by prescribing a bridging mechanism.

President of ICAI, Mr. Ved Jain, said "The instant MRA with CPA Australia by ICAI is a step forward in increased mobility to professionals at either end and would herald a new dimension for businesses globally."

Mr. Jain further said, "It also puts the two accountancy professions from India and Australia on global radar to play the leadership role in addressing new challenges before profession."

"A landmark agreement between CPA Australia and ICAI highlights the increasingly global nature of the accounting profession", said Alex Malley, President of CPA Australia Ltd.

As per the MRA, members of ICAI who are graduates will be eligible for CPA Australia membership on passing one paper on Business Strategy and Leadership.

On the other hand, members of CPA Australia will be eligible for ICAI membership subject to passing two papers on Corporate & Allied Laws and Taxation and two more papers on Advanced Auditing & Professional Ethics and Financial Reporting, if they have not already passed them as a part of the CPA Australia programme.

The papers in respect of bridging mechanism as above would be administered locally by the two institutes. MRA is likely to herald an increased mobility of the professionals in either country.

"The MRA will open professional opportunities to our members in Australia and this will bring the two countries, India and Australia, closer", Jain added.

This MRA comes closer on the heels of an arrangement entered by ICAI with the Institute of Chartered Accountants of England and Wales in November 2008.

November 20, 2008 - ICAI signed a MOU with ICAEW, UK and terms of agreements are more favourable to ICAEW, UK. The entry requirement for ICAI members are more stringent and expensive ( £1,990 to start with). ICAEW, UK member has an easier route to become a member of ICAI and start practice in India.

Mar 31, 2009 - National Advisory Committee on Accounting Standards (NACAS) may have favoured suspension of mark-to-market accounting norms on foreign exchange transactions for corporate sector for two years, but Institute of Chartered Accountants of India (ICAI) is in no mood to suspend the accounting standards (AS) 11 provision. ICAI president Uttam Prakash said here that he was not in favour of suspending the provision of AS 11 for the benefit of a few companies.

Agrawal told TOI that big companies failed to implement crisis management that could have saved them from current problems related toforeign exchange rate fluctuations. Several big companies and industrial associations have approached ICAI to suspend the AS 11 provision that requires recognisingforeign exchange losses in the profit and loss (P&L) accounts every year.

Mar 2, 2010 - Accounting regulator Icai is considering making names of tainted auditors public information, in an effort to enhance transparency and repose public faith in the auditing community.

This community came under criticism in the aftermath of the accounting scandal at software firm Satyam, where auditors helped the management to fudge and inflate revenues and cash figures.

Icai’s attempt at improving transparency is somewhat similar to Cibil (Credit Information Bureau of India Limited), which has information on credit history of borrowers.

Talking to reporters in Chennai on Tuesday, Icai president Amarjit Chopra said, “We will take it up in the council to host names of members who have been held guilty of professional misconduct on our website. We might take it up in the April or May meeting. The council will not hesitate in doing this because it will improve the public perception about the institute.”

Icai’s disciplinary committee had earlier found the two Satyam auditors- Srinivas Talluri and S Gopalakrishnan guilty of professional misconduct but could not take any action since they were in jail since January last year.

“Delays are inevitable in certain cases. Our hands were tied because they were in jail. But, if the two are available for a period of 2-3 months, we would like to finish it off in that period,” Mr Chopra said.

Mr Chopra further said that the disciplinary committee would issue notices to Srinivas Talluri, who got out of jail on bail last month. While Icai has powers to take action against an individual, it is not empowered to do the same against a particular firm. But it is pushing for some change in this aspect.

“Our high-power committee report presented to the government recommends the need for power to against firms. We require certain powers if there are repeated failures on the part of a firm,” Mr Chopra said.