Dear Professional Colleagues,
“When you have exhausted all possibilities, remember this: you haven’t.” – said Thomas A. Edison. With the chequered past sprawling over more than seven decades, ICAI has consistently overcome all the challenges and is playing a leading role in Indian growth story. Undeterred by the present challenges being faced globally due to pandemic, ICAI has been taking different steps to safeguard the business world. ICAI firmly believes that life does not alter its predesigned course to become simpler; it expects us to change our attitude and inculcate strength and resilience in our disposition in order to attain success. The same is true for the business processes, activities and manner in which transaction takes place which keep on changing with the time. ICAI has always encouraged its members and stakeholders to be resilient and take obstacles in their stride as challenges are an invariable and inevitable consequence of life. Maintaining resilience in times of adversity and looking at challenges in the eye with indomitable strength pushes people to emerge as admirably indestructible, akin to how carbon turns into diamond under extreme pressure. Under the current pressures of the pandemic, the accounting profession and all its stakeholders must take utmost care in its conduct and actions. After all, it is an active choice to be identified in misery and not be brought down by it.
Resilience allows one to wholesomely embrace the vast realm of human experience by building implicit and undying faith in oneself to overcome the unexpected. Helen Keller once remarked, “Character cannot be developed in ease and quiet. Only through experience of trial and suffering can the soul be strengthened, vision cleared, ambition inspired, and success achieved.” In these times, the skills that the accountancy professional develops and applies are fundamental to build a better world with resilience in business. A resilient business understands that it was created to pursue and achieve certain objectives by taking risks and deliver results in form of returns to stakeholders and thereby contribute to the economic development. The business needs to be aware that while risk cannot to be eliminated, it can be managed and mitigated by careful planning. The business needs to understand that future is uncertain and it is not possible to plan all the actions and activities that are yet to take place with certainty as the business has no idea how future will shape up.
Professional accountants, with their deeper understanding of the processes, procedures and systems, can help business to build early warning structures within the organisations to forewarn about the threats and mitigate the risk. Unforeseen challenges such as the ongoing pandemic present unpredictable circumstances, yet a resilient organisation must possess enough resources and financial strength to withstand these hard times, the strengths that will give sufficient time to the organisation to recoup and react before the effects become insurmountable. Professional accountants may not possibly manage each and every risk as they also have their own human limitations, they can certainly bring adaptability in the business and make it more agile and responsive. They can help business to minimise the harmful effects of hostile environment and more importantly, take advantage of the situation, as it changes. Things may be difficult but certainly not impossible to manage.
Opening of ICAI Representative office in Leh
As a true partner in nation building, the Institute opened a representative office of the ICAI at Eliezer Joldan Memorial College, Leh, Capital of Union Territory of Ladakh. The initiative will contribute to the development of the newly formed Union Territory and act as a support to Government initiatives, besides spreading knowledge in the field of accountancy and facilitating services to the upcoming and existing members and students. Shri Jamyang Tsering Namgyal, Hon’ble Member of Parliament, Ladakh Parliamentary Constituency inaugurated the ICAI Representative Office on November 17, 2020. With the opening of the representative office, the CA course, one among the most economical courses, will be accessible to the interested candidates at their doorstep and thus empower the youth through skill development and will also equip them to be a part of the mainstream economy. Towards the cause of development of accountancy profession in the area, there will be 75% waiver in the registration fee for the students pursuing Chartered Accountancy course from the Union Territory of Ladakh.
ICAI Awards, 2020 – The Legacy Continues
While many Chartered Accountants choose to take up practising the profession, majority of young members are moving to industry to take up jobs. With multiple skills, financial expertise, ability to deal with an array of problems and take quick decisions, our members are preferred professionals in the business. With the skills possessed by them, they are easily absorbed by business organisations and quickly rise in the corporate ladder. The Committee for Members in Industry & Business, instituted ICAI Awards to recognise the professionals who possess excellent skills, dedication, enthusiasm, leadership, and the ability to deliver towards the objectives of business in a sustainable manner. ICAI, continuing this legacy to honour exemplary performance of stellar individuals, is organising 14th ICAI Awards in January, 2021. Members may visit https://awards.icai.org/ for nominations forms and other details.
Pre-Budget Memorandum-2021 – ICAI Participates in the Process
Over the years, the Finance Ministry has been holding pre-budget and postbudget consultations with the ICAI and other industry associations, trade bodies and experts to seek ideas for the annual budgets. The forthcoming Union Budget – 2021 is special in the sense that it is the first budget after the challenges of pandemic have impacted the Indian economy. The budget will surely seek to reverse the negative impacts on the otherwise burgeoning Indian economy that has been achieving high growth rates, one of the best in the emerging markets. To tap the knowledge and skills of members emanating out of their rich experience, the Direct Taxes Committee, GST & Indirect Taxes Committee and Committee on International Taxation of ICAI had invited suggestions from the fraternity that can form part of Pre-Budget Memoranda - 2021 for submission to the Ministry of Finance or respective State Ministries. These suggestions were considered by the committees, finalised with their own experience and submitted to the Government for appropriate consideration.
Futuristic Programmes for Skill Building and Development
Global Management Development Program: On the occasion of the World Accountant’s Day, ICAI launched a Global Management Development Programme: Leadership Beyond Boundaries from its Centre of Excellence Hyderabad in line with the continuous thrust of ICAI towards knowledge upgradation and professional enrichment even during these pandemic times. The program received immense response and 75 participants from all over the world including Australia, Singapore and Middle East countries, besides all parts of India joined for this programme. The course is intended to inculcate the competencies and skill sets that are considered as essential to success in the current environment. This pandemic has affected the businesses and economic activities throughout the world in a manner that was not seen or heard in the last hundred years. These challenges have taught the industry leaders to think out of the box, innovate and prepare for any kind of disruption. The programme would go a long way in inculcating desired skill sets to face hard times to bring resiliency.
Centre for Audit Quality of ICAI - Launch of Virtual Executive Master Program: The future of the profession lies in its ability to change, evolve, and adapt to the changing environment, which is a central element of the various reforms. To make available conducive environment for research and develop a systematic audit quality framework, ICAI recently established Centre for Audit Quality (‘CAQ’) as a Special Purpose Directorate. Audit quality is the hallmark of the audit profession. The Directorate endeavours to help consistent improvement in audit quality and boost position of Indian profession in the world economic map. To be future ready, professional accountants need to learn and equip themselves in new age technology skills, acquire strategic managerial skills besides continuing their prowess in accountancy, finance, taxation and business laws. Auditors today need to reinvent themselves. Keeping these aspects in mind, ICAI launched 1st batch of the “Virtual Executive Master Program – New Age” at CAQ. Such programs would help the members to remain updated and equip themselves with the skillsets required in the global environment for organization sustainability and learn new age professional practices. The CAQ can play an important role that would further build Investor’s confidence and develop public trust, at large
MCA-21 E-Governance Portal – Opportunity to Provide Suggestions
The Ministry of Corporate Affairs (MCA) has taken up to build a new MCA21 v3 system – upgraded version of MCA- 21 portal to enable easy and secure access of MCA services. The new portal is expected to be equipped with latest features and technology. The core objectives of MCA21 v3 system are promoting automation, integration with external regulatory, and to aid ‘ease of doing business’. In this regard, the Corporate Laws & Corporate Governance Committee of ICAI invited members to provide suggestions out of their experiences to capture the issues that are being faced by the stakeholders pertaining to MCA 21. The issues will be forwarded to MCA to be looked into while developing the new version-3 of MCA-21 E-Governance Portal. Further details in this regard are available on ICAI website.
Moving Ahead in a Borderless World – Developments on Account of Changes in IBOR
In the year 1957, CA. S.P. Chopra, the then President, ICAI, observed at the 8th International Congress of Accountants held in 1957 in Amsterdam – “Of late the element of uncertainty in forecasting has become more complex, for the bank rates in certain European countries have been rising unexpectedly. It almost looks as if the bank rate is losing its sanctity. A large number of contracts were based on the prevailing English bank rate but as a result of the sudden rise in the bank rate, the cost of supply from Britain and some other countries went up unexpectedly.” The challenge of benchmark rates continues to be mind boggling and tricky. In India, the banks have been using different benchmarks and RBI has been continuously evolving the systems for overall benefit. Today, in this backdrop, the world is facing a critical challenge – imminent fall of LIBOR. LIBOR which is widely used internationally is not guaranteed to continue to remain available after 2021 end.
Typically, the financial world uses some or other Interbank offered rates (IBORs) as benchmarks. Today, as a result of recommendations of Financial Stability Board, many jurisdictions are taking steps for replacing existing IBORs with some alternate benchmark rates. In this regard, International Accounting Standards Board has identified two groups of accounting issues that could affect financial reporting due to these reforms. These groups relate to pre-replacement issues and replacement issues with effects on different IFRSs and IASs. In tandem, Accounting Standards Board of ICAI is also moving ahead, identifying relevant changes in Indian Standards. Recently, ASB released an Exposure Draft on Interest Rate Benchmark Reform – Phase 2 (Amendments to Ind AS 109, Ind AS 107 and Ind AS 116) which is available on ICAI website.
MCA Extends Last Date for Filing Document
Considering the difficulties faced by the corporates and professionals and to provide greater ease of doing business, a request was submitted to extend the timelines for the stakeholders who are struggling with their day to day activities of completing their books of accounts appropriately. In this regard, we are glad that the Ministry of Corporate Affairs has considered the request of the Institute and issued General Circular, wherein the timeline for filing belated documents has been extended from 31st August, 2020 to 30th November, 2020. Accordingly, extension is also available for furnishing of financial statements for the F.Y. 2019-20. Further, the statement of account and solvency for the financial year 2019-2020 which has been signed beyond the period of six months from the end of financial year but not later than 30thNovember, 2020, will not be deemed as noncompliance.
The year 2020 has been an unprecedented and unpredictable year strewn with numerous ebbs and flows, yet the lessons we learnt from it are far greater in degree of significance and magnitude than the curveballs it threw. After all, every night is inevitably followed by a bright sunrise. This year taught us that no obstacle is bigger than us as long as we are equipped with positivity and faith as our armour. A consistent belief in the best helps us defy the trying tests of time and align the odds in our favour. Positive thoughts manifest into a positive reality; thus, by deploying the invincible strength and robust prowess of our mind, we can actualise our goals and ambitions. The entire humanity has cheered the news of successful trials of various vaccines. Every dark cloud has a silver lining and every disaster has an opportunity. But the opportunities come wearing the overalls of hard work. As the economies emerge from hibernation, the accounting community should strive to find innovative solutions to combat the aftermath of the things that have taken place this year. To quote Martin Luther King Jr, “If you can’t fly then run, if you can’t run then walk, if you can’t walk then crawl, but whatever you do, you have to keep moving forward.”
Stay safe and healthy.
Jai Hind, Jai ICAI,
CA. Atul Kumar Gupta
New Delhi, 28th November, 2020