My dear professional colleagues,
On 15th August 1947, India’s first Prime Minister Shri Jawaharlal Nehru had proclaimed that our endeavours must aim to bring freedom and opportunity to the common man, fight and end poverty and ignorance, and build up a prosperous, democratic and progressive nation. Recently at BRICS conference in Xiamen, India’s present Prime Minister Shri Narendra Modi has reiterated that proclamation when he said that the bedrock of our development agenda is in the idea of Sabka Saath, Sabka Vikas. India still has about 35 crore youth and adults, who need to be brought within the ambit of literacy, education and empowerment.
International Literacy Day, celebrated on 8th September, reminds us to reflect on the existing challenges of our education sector. UN’s 2030 Agenda for Sustainable Development asks us to ensure inclusive and equitable quality education and promote lifelong learning opportunities for all. As you may be aware, India has committed to implement the UN’s 2030 Agenda for Sustainable Development. Both IFAC (International Federation of Accountants) and CAW (Chartered Accountants Worldwide) are promoting the UN Sustainable Development agenda. According to IFAC, accountancy is the basis of strong and sustainable organizations, financial markets, and economies, while CAW has discussed the role of accountancy profession is tackling the global goals for sustainable development.
Since its inception, ICAI has taken possible measures to make the CA education affordable and accessible to all economic strata of our country. Being a gender- and disability- sensitive institution, ICAI has been empowering the youth of our nation, producing almost fifteen to twenty thousand premier, competent and global accounting professionals a year and thereby contributing to both national as well as world economy.
Let me bring before you some of the significant developments in accountancy profession that have taken place in the last one month:
New Appointments in Union Ministries of Finance and Corporate Affairs
While Hon’ble Shri Arun Jaitley continues to be the Union Minister of Finance and Corporate Affairs, Shri Radhakrishnan P. and Shri Shiv Pratap Shukla are the new Union Ministers of State for Finance, and Shri P. P. Chaudhary the new Union Minister of State for Corporate Affairs. On behalf of the Institute, I take pleasure to welcome them. I also wish to acknowledge that our senior members at the helm of affairs in Indian polity, CA. Suresh Prabhu and CA. Piyush Goyal, have become Cabinet Ministers for the Ministry of Commerce and Industry and the Ministries of Coal and Railways, respectively. We wish all of them a very successful tenure ahead. I am sure, ICAI will continue to receive guidance and support from them in our professional endeavours. We will keep acting efficaciously to cooperate and provide all possible technical and other assistance on both voluntary and solicitation basis, whichever, wherever and whenever applicable.
Recently we had an opportunity to welcome and meet the Hon’ble Union Minister of State for Corporate Affairs Shri P. P. Chaudhary. We made a detailed presentation to the Hon’ble Minister on various activities of the ICAI.
ICAI Exchanges MoU with ICA Nepal in Presence of Indian and Nepal PMs
To boost the bilateral ties and cooperation between India and Nepal, ICAI recently signed an MoU with ICAN (The Institute of Chartered Accountants of Nepal). On behalf of ICAI, I had the privilege to exchange the MoU with the ICAN President CA. Prakash Jung Thapa in the august presence of Prime Minister of India Shri Narendra Modi and Prime Minister of Nepal Shri Sher Bahadur Deuba in New Delhi. This MoU, a milestone in more than two-decade old mutual cooperation, aims to mutually benefit the accounting profession in both the countries. As you may be aware, in 1997, ICAI had played a key role in overall establishment of ICAN. It is significant that ICAI today has a strong membership base of over 1000 members in Nepal qualified from ICAI. Before this exchange, ICAN delegation also made a visit to ICAI, where we discussed professional issues of mutual concerns.
Edinburgh Group and IFAC Board Meetings in New York
I along with ICA past President and IFAC Board member CA. K. Raghu, attended the Edinburgh Group meeting on 6th September 2017 held in New York. Then, we attended the IFAC Board meeting there on 7th-8th September 2017, which dwelled upon various issues relating to accountancy profession at large.
ICAI-CAW Members Event and CAW Board Meeting in Mumbai
Being a member of CAW, we organised an ICAI-CAW Members Event on the theme, Chartered Accountants: Gearing up for New Era on 29th-30th August 2017, which had two sessions of Digital Transformation and Relevance to Accountancy Profession and Working Globally- A CAW Forum Perspective. ICAI also hosted the Board Meeting of CAW, where CEOs of Ireland, ICAEW, Singapore, Bangladesh and Indonesia discussed networking, promotion of CAW brand and revival of membership of professional bodies.
CPA Canada Visits ICAI
CPA Canada Senior Vice-President Ms. Tashia Batstone visited ICAI recently on 15th September 2017 to discuss the status of MoU to be signed between ICAI and CPA Canada. During the discussion, the Senior Vice-President informed that there were opportunities for members interested in settling in Canada. It was also informed that there were opportunities for one level below professional accountants like accounting technicians, or other commerce graduates or postgraduates if they complete the CPA Canada’s Advanced Certificate in Accounting and Finance.
SAFA Events in Kathmandu
I along with my Council colleagues CA. Atul Gupta, CA. Mangesh Kinare, CA. Mukesh Kushwah, CA. Ranjeet Agarwal, CA. Sanjay Agarwal, CA. Rajesh Sharma and CA. Kemisha Soni attended the 48th SAFA Board meeting and other Committee meetings of SAFA held in Kathmandu on 27th-29th August 2017. There, some of us also attended a well-attended SAFA International Conference organised on the theme Role of Professional Accountants in Economic Development and Sustainability, which was inaugurated by the Deputy Prime Minister and Minister of Education of Nepal Shri Gopal Man Shreshtha. ICAI Central Council member CA. Atul Kumar Gupta was one of the panellists in the session on Role of Professional Accountants in Economic Development.
JAM Revolution to End Financial Exclusion
It is highly commendable that India is within the reach of 1 billion-1billion-1 billion vision of financial inclusion involving the ambitious government initiative of JAM (Jan Dhan, Aadhaar and Mobile) - just achieving maximum - maximum value for every rupee spent, maximum empowerment for the poor, and maximum technology for the masses. According to Union Finance Minister Shri Arun Jaitley, India will soon have one billion unique Aadhaar numbers linked to one billion bank accounts and one billion mobile phones. This important milestone will go a long way in ending the financial, economic, digital and social exclusion faced by the India’s poor.
ICAI’s Contribution to GST Implementation - An Update
Despite teething and procedural issues and system glitches in the GST implementation, the biggest economic reform is having an impact in business. The Government is having a liberal approach so as to allow the assessees to understand the procedures under GST for its effective execution, which is evident from the fact that due dates for filing of GST returns especially for the month of July have been relaxed and extended up to 10th October, 31st October and 10th November 2017 for filing GSTR 1, 2 and 3 respectively. Also, GST Council at its 21st meeting held on 9th September 2017, extended the time limit for registration under composition scheme up to 30th September 2017, provided additional exemptions, relaxed registration norms and reduced GST rates on certain goods and services, among others.
Being a facilitator of GST implementation, ICAI is undertaking many steps to support the Government and stakeholders. Recently, we submitted the implementation issues being faced under GST along with possible suggestions to the Government. Benefitting more than two lakh participants, ICAI has conducted more than 2,600 programmes, seminars, workshops, etc., on GST so far, to empower its members and other stakeholders.
Let me also inform here that UAE is implementing VAT (similar to GST in India) with effect from 1st January 2018 and ICAI through its strong presence of its Chapters in Dubai and Abu Dhabi, is coming out to support the VAT implementation by developing a background material on UAE VAT and is planning courses, seminars, etc., to help the members as well as other stakeholders in UAE.
Support Operation Clean Money for Building a Tax-Compliant Nation
In the context of demonetisation, the Income Tax Department had initiated the Operation Clean Money (OCM) or Swachh Dhan Abhiyan on 31st January 2017 with the objective to create a tax compliant society through a fair, transparent and non-intrusive tax administration. In this regard, Union Finance Minister had launched an OCM portal (i.e. https://www.cleanmoney.gov.in/), wherein a section on citizen engagement has been included. Refer to Clean Money Participants section.
We at ICAI have committed our support to this mission. I urge my esteemed fraternity to actively participate in the Operation by extending their support and filling up their credentials (i.e. membership no. and date of birth) by clicking at Operation Clean Money - Take a Pledge! under the Most Important section of ICAI Website. For details, you may visit www.cleanmoney.gov.in, and email at firstname.lastname@example.org for queries and feedback.
Knowledge Sharing Arrangement with ICAEW for IIIPI’s Insolvency Professionals
To enhance the skills of its insolvency professionals, Indian Institute of Insolvency Professionals of ICAI (IIIPI) has entered into an arrangement with ICAEW (The Institute of Chartered Accountants of England and Wales), which is a leading professional accountancy organisation worldwide. Having 30-year experience in insolvency, ICAEW is the largest regulator of insolvency professionals in the United Kingdom.
As per the arrangement, ICAEW will be a knowledge partner with IIIPI with regard to the insolvency regulation. Insolvency professionals of IIIPI who will subscribe to ICAEW’s online Insolvency and Restructuring Group will be provided an access to live and pre-recorded webinars, e-Newsletters, help sheets meant on specialised areas of insolvency practice, access to ICAEW’s online insolvency community, discounted fee for ICAEW’s annual insolvency conference, and other knowledge sharing facilities.
ICAI Brings out Two New Ind AS Publications
Committed to play a pivotal role in the effective and smooth implementation of IFRS- converged Ind AS in India, ICAI is undertaking various initiatives including the training of accounting professionals and spreading of awareness and providing guidance on Indian Accounting Standards. I take pleasure to inform that ICAI has revised Educational Material on Ind AS 18, Revenue (Revised 2017) and Indian Accounting Standards (Ind AS): An Overview (Revised 2017), published earlier, capturing the recent amendments made in the Ind AS. I am sure, these publications will empower all our stakeholders further, enhancing their understanding of Ind AS.
Need for Enhanced Professional Scepticism
The importance of professional scepticism is underscored by the increasing complexity of business and financial reporting, including the greater use of estimates and management judgment, business model changes due to technological developments, and the fundamental reliance of the public on dependable financial reporting.
It lies at the heart of a quality audit. In view of fastpaced changes on regulatory and economic front in the country, combined with ever-rising expectations from accounting professionals, it is high time that we increased application of professional scepticism while discharging our professional duties in a creative way. The issue is being given a renewed emphasis by the IFAC too, which has recently published Toward Enhanced Professional Skepticism that is worth a careful reading.
Representations Submitted to CBDT
ICAI has represented to CBDT that the Office Memorandum dated 31st July 2017 should be applicable with effect from 1st August 2017, i.e. in respect of stay of demand orders passed on or after 1st August 2017 and the earlier stay orders passed following the instruction dated 29th February 2016 will not be revisited. CBDT has favourably considered the matter and clarified that the modifications laid down in CBDT's office memorandum are prospective in nature and matters already decided before the issue of memorandum dated 31st July 2017 shall not be reviewed merely on the grounds of the modifications laid down in the said memorandum.
In response to ICAI’s representation to CBDT that due to GST implementation and other issues the due date of filing income-tax returns for assessees mentioned under clause (a) of Explanation 2 to Section 139(1) and tax audit reports for the AY 2017-18 should be extended from 30th September 2017 to 30th November 2017, CBDT extended the due date for filing of tax audit as well as tax-returns from 30th September to 31st October 2017. Members are facing problems in view of the GST implementation challenges and the time consumed in comprehending new enactment and various compliances required to be made in August- October under GST Act, Income-tax Act, 1961 and Companies Act, 2013. We extend our thanks to CBDT for extending the deadline proactively one month in advance.
Further, pursuant to the amendments as made by Finance Act, 2016 in the Section 44AD of Income-tax Act, 1961, a representation was submitted to CBDT. The representation was regarding issuance of a clarification whether eligible assessees carrying an eligible business shall be required to get the books of accounts audited and furnish a report of such audit as required under Section 44AB of the Income-tax Act, 1961. This is when if they have not declared profits in any previous year in accordance with the provisions of Section 44AD. This is, provided, they have a total income exceeding the maximum amount that is not chargeable to incometax and a turnover less than the limits prescribed under Section 44AB. and they claim the profits from the eligible business to be less than 8% (or 6% as the case may be) of total turnover or gross receipts. Further clarification has been sought if an assessee, who opts for presumptive provisions under Section 44AD in the AY 2016-17, would be hit by the provisions of Sections 44AD(4) and 44AD(5), if she/he does not opt for presumptive tax provisions under Section 44AD in the AY 2017-18.
In view of certain issues brought to the notice of ICAI, regarding intimations being received by taxpayers in respect of the proposed adjustment made under Section 143(1)(a) subsequent to the filing of income-tax returns for the AY 2017-18, a representation has been submitted to CBDT. We have requested them to consider the hardships faced by members and assessees on account of the communication of proposed adjustment under Section 143(1)(a) of the Income-tax Act, 1961. A representation has also been submitted to the MAT Ind- AS Committee in response to a press release in July 2017 that had invited suggestions on retroactive amendment recommended by MAT Ind-AS Committee in the MAT provisions for Ind-AS companies.
ICAI Central Council Member Elected AOSSG Vice-Chair
I take pride to inform that my Central Council colleague and Chairman of Accounting Standards Board of ICAI, CA. Shiwaji Zaware, has been elected Vice-Chair of the Asian-Oceanian Standard-Setters Group (AOSSG), a group of 26-member countries, for the period November 2017 to November 2019. On behalf of the profession, let me extend my best wishes to him, as this will help India to contribute effectively to the development of highquality international financial reporting system.
75th NACAS Meeting in New Delhi
75th meeting of the National Advisory Committee on Accounting Standards (NACAS) was held recently in New Delhi, with its Chief Guest as MCA (Ministry of Corporate Affairs) Secretary Shri Tapan Ray, to celebrate its long and successful journey since its formation in 2001. ICAI apprised the Committee on the status of IFRS convergence in India, Ind AS impact analysis on companies covered by first phase of Ind AS implementation and status of upgradation of existing accounting standards.
Past Presidents Meet in New Delhi
Recently, a meeting of ICAI past Presidents from the Western region of ICAI was organized in Mumbai on 2nd September 2017, earlier organised in New Delhi on 12th August 2017, where the Institute looked up to their wisdom on how to strengthen its disciplinary mechanism, effectively communicate to the Government, regulators, media, members, etc., make Indian firms globallyrelevant, and enhance ethical thinking in the fraternity, among other concerns.
ICAI International Conference in Mumbai
I take pleasure to inform that ICAI is organising its annual mega International Conference on the theme of Accountancy Profession: Convergence and Sustainability in Digital Era on 8th-9th December 2017 in Mumbai, as informed before. The Conference will prove to be an apt platform for local and global accounting fraternities to expound new thought leadership in emerging areas of accounting profession, including accounting standards, integrated reporting, transparent regulatory regime, new frontiers with introduction of GST and the era of digitization, to meet the expectations of our nation’s economy. More than 1500 professionals and business leaders are likely to participate in the Conference. I would request you to block your dates and actively participate in the Conference to make it successful.
Convocations, held to promote professional camaraderie among the newly-qualified Chartered Accountants, were held on 1st-2nd September 2017 across the nation, in nine cities, viz. Ahmedabad, Mumbai, Pune, Chennai, Hyderabad, Kolkata, Kanpur, Jaipur and New Delhi, where more than 8500 Chartered Accountants participated. I wish all of them a great career ahead.
CIRC and WIRC Regional Conferences Held
37th Regional Conference of CIRC was held in Kanpur on 26th-27th August 2017, where Uttar Pradesh Deputy Chief Minister Dr. Dinesh Sharma was the Chief Guest. 32nd Regional Conference of WIRC was held in Mumbai, where Union Bank of India Chairman Shri Kewal Handa was the Chief Guest. Both the events witnessed a strong presence and participation of our professional fraternity.
October is known in India not only to recall and celebrate the ideas and ideals of Mahatma Gandhi, whose birthday falls on 2nd October, but also to strengthen and reinforce his messages of love, peace and non-violence in our society that he had given to the world in the interests of humanity. I extend my best wishes on the birthday of Mahatma Gandhi and also of Adikavi Maharishi Valmiki, i.e. 5th October, who composed the Adi Kavya, i.e. first epic, in Sanskrit, Ramayana, comprising 24,000 verses.
In the coming month, we will have many opportunities of festivity and togetherness with an exception of Dussehra that falls on 30th September-let us celebrate Karva Chauth (8th October), Deepawali (19th October), Goverdhan Puja (20th October), Bhai Dooj (21st October), and Surya Shashthi or Chhath (26th October), to celebrate human bonding and relationship, and fortify our nation with love, peace and happiness.
Take care of your health in this professionally-busy season.
CA. Nilesh S. Vikamsey