Overview
This message highlights the evolving role of Public Financial Management (PFM) in India's governance framework, emphasizing transparency, accountability, and inclusive growth aligned with Viksit Bharat 2047. It outlines ICAI’s key initiatives, including Information Systems Auditing Standards (ISAS), support for the Income-tax Act, 2025, capacity-building programs, and collaborations with institutions and regulators. The note underscores the importance of
strong financial systems at grassroots and urban levels while reinforcing ICAI's commitment to strengthening governance, audit quality, and professional excellence in a rapidly digitizing economy.
Official copy of the message delivered by ICAI President
Dear Professional Colleagues,
The preamble to our Constitution lays the foundation of a policy framework rooted in egalitarian principles, reinforced by Directive Principles of State Policy, which underscore the role of a state as a welfare entity. In this context, sound governance and credible public financial management (PFM) assume critical importance in enabling effective policy delivery, fostering inclusion and ensuring socio-economic equity in alignment with prudent fiscal management, sustainability and transparency.
Far beyond traditional revenue management and budgetary allocation, the PFM, as a concept, has evolved into a strategic instrument for articulating a nation’s development priorities, promoting inclusivity. The Independent Evaluation Group of the World Bank recognises sound PFM as a key pillar for advancing shared prosperity through effective use of public resources. In a country as vast and diverse as India, robust public finance systems are essential to translate policy intent into tangible outcomes and ensure that benefits reach the intended beneficiaries.
Public finance is no longer confined to traditional budgets; it now reflects intent, efficiency in implementation, and the credibility of institutions. Government accounting plays a distinct, but indispensable, role in this larger framework. The shift towards accrual-based accounting, outcome-focused budgets, and digital financial management is not only transforming the procedures, but also reshaping governance standards towards greater accountability, transparency and result-oriented outcomes.
The relevance of sound public finance at the grassroots level is significant in India, where rural development programs, welfare schemes, and infrastructure projects primarily rely on efficient fund flows and effective monitoring. The importance of 2.68 lacs Panchayati Raj Institutions (PRIs) as the last-mile delivery institutions for inclusive development cannot be overstated. The ways in which PRIs account and utilise public funds directly impact on-the-ground outcomes; therefore, strengthening financial management and accountability is critical for equitable and sustainable growth.
At the same time, the pace of urbanisation, in alignment with the sustainability agenda, presents both challenges and opportunities before policymakers as well as institutions implementing the same. Rapidly expanding cities require adequate infrastructure, sustainable planning, and robust financial capacity. More than 6000 Urban Local Bodies (ULBs) must strengthen accounting frameworks and explore diversified avenues of financing. Transparent and credible financial management enables ULBs to build stakeholders’ confidence and improve the overall management capacity of the resources.
The United Nations Sustainable Development Goals (SDGs) have broadened the scope of public finance, requiring governments to align fiscal policies with broader developmental objectives such as poverty alleviation, quality education, gender equality, climate action and sustainable cities.
In this context, the Institute, as a Partner in Nation building, continues to play a meaningful role through focused initiatives through its Public and Government Financial Management Committee. With regular capacity building programs, technical guidance, contribution to policy discussions, and association with policy makers, think tanks and Institutions, the profession remains closely connected with the larger goal of strengthening public financial management in the country.
The Institute’s contribution to the field of public finance management includes supporting the government and its constituents in the formulation of accounting standards. As of now, 31 Accounting Standards for Local Bodies (ASLBs) have been issued, including a cash- based standard to facilitate the transition from cash to accrual accounting aligned with international standards. Further, the Institute is supporting organisations such as Indian Railways and select local municipalities in shifting towards accrual-based accounting. The Institute also contributes to capacity building exercises by strengthening institutional competencies through structured training programmes. So far, more than 3,000 government officials have been trained, including those from O/o C&AG, ICoAS, and various state Governments such as Gujarat, Tamil Nadu, Maharashtra, Uttarakhand, Nagaland, Tripura, Bihar and Punjab.
Further, in support of Panchayati Raj Institutions (PRIs) and Urban Local Bodies (ULBs), the Institute, in collaboration with O/o C&AG, has been conducting Certificate Courses for Accountants of Panchayats and Municipal Bodies since 2023. These initiatives aim to strengthen accounting practices and record maintenance by ensuring the availability of trained accountants at the grassroots level, including in remote areas. Several Urban Development and Panchayati Raj Departments across states are now mandating these courses for accounts staff of local bodies, marking a significant step towards greater uniformity, accountability, and financial discipline.
As we move towards the vision of Viksit Bharat 2047 - Sabka Saath, Sabka Vikas, Public Finance Management will continue to play a central role in the nation’s planning and development journey. It will shape how we prioritise resources, execute programs and measure outcomes. More than ever before, there is a need to re-orient our public financial management systems to be responsive, transparent and largely aligned with long-term national goals of inclusion, sustainability, efficiency and accountability.
The Institute envisions itself as a committed partner in this mission, dedicated to mentoring and developing professionals who can navigate the complexities, ethical dimensions and technical intricacies of public finance. When the path ahead is challenging, it also offers immense possibilities. With strong intent, capable institutions and a shared sense of responsibility, public finance can be transformed into a powerful instrument for building trust and contributing to a more resilient and prosperous India
Let’s have a look at some of the important developments at the Institute level
Advancing the Profession through Knowledge and Insight
Information Systems Auditing Standards - Strengthening the Trust Framework in the Digital Era
In a significant step towards strengthening assurance in a technology-driven environment, the ICAI has developed the Information Systems Auditing Standards (ISASs). ISASs are expected to significantly enhance the role of Chartered Accountants in digital assurance by equipping them with a comprehensive framework to evaluate complex technological environments.
With business processes, financial reporting and governance systems increasingly dependent on information technology, ISAS provides a structured, principle-based framework for conducting Information Systems Audit engagements in a consistent and reliable manner. The Institute has recently released a compendium of ISAS comprising 11 standards. These standards will complement traditional financial audit by providing a structured framework to enable professionals to evaluate the integrity, confidentiality, availability, reliability and security of information systems that support financial and operational processes.
As India moves towards becoming a digital economy, ISAS will play an important role in enhancing trust and accountability. With this pioneering initiative, the ICAI continues to lead standard-setting efforts aligned with global practices.
ICAI Publications on the Income-tax Act, 2025 and Rules, 2026
The Income-Tax Act, 2025, which came into force on 1st April, 2026, marks a defining moment in India’s direct tax regime. With the notification of the Income- tax Rules, 2026 and prescribed forms in March 2026, the foundational framework of the new law now stands complete. The Institute has played a pivotal role in this journey, working closely with the Government at every stage in shaping this landmark legislation.
In line with its commitment to capacity building, ICAI had earlier released the first edition of its publication on the new law in September 2025. The encouraging response from members has led to the release of an updated edition incorporating amendments brought in by the Finance Act, 2026. Further, with the notification of the new Rules and forms, the Institute has also introduced a comprehensive publication covering the Income-tax Rules, 2026. A distinguishing feature of both these publications is the tabular mapping of sections, rules and forms, with those under the earlier law, providing clear linkages and aiding understanding. This will help members quickly identify corresponding provisions, reduce interpretational gaps, and handle assignments with greater clarity.
Memorandum of Understanding (MoU) with the Andhra Pradesh Police Department
The Institute, through its Public and Government Financial Management Committee, has entered into a Memorandum of Understanding (MoU) with the Andhra Pradesh Police Department (Training Wing) to impart training and strengthen their knowledge and practical understanding of economic offences, financial frauds and related investigation techniques. The MoU was exchanged in the presence of CA. Hans Raj Chugh, Central Council Member, ICAI and senior IPS officers from Andhra Pradesh Police Department (Training Wing).
Under the framework of this MoU, ICAI will provide its technical expertise, experienced faculty, and structured learning resources to conduct training programmes. This MoU emphasises ICAI’s commitment to strengthening the governance ecosystem and combating financial crimes.
Engaging with Stakeholders - Promoting Professional Developments
Representation before the Parliamentary Standing Committee on Finance
The Institute continues to play a meaningful role in shaping the country’s financial and regulatory ecosystem. In this regard, ICAI had the privilege of presenting its views before the Parliamentary Standing Committee on Finance on the proposed Securities Markets Bill, 2025. The Institute’s suggestions reflected a forward-looking approach, focusing on strengthening governance, enhancing transparency, and building institutional capacity through professional expertise. The recommendations focused on practical areas such as capacity building, greater transparency, timely adjudication, and the integration of technology in regulatory processes. Further, suggestions for the inclusion of professionals are made to make institutions more robust and responsive, while adding value to the policy formulation.
Meeting with RBI
With a focus on strengthening the audit framework in Public Sector Banks, I, along with CA. Mangesh Kinare, Vice President, ICAI and Central Council members had a meeting with Smt. Usha Janakiraman, Executive Director, Reserve Bank of India. Discussions in the meeting were held on key areas such as enhancing transparency in auditor appointments, expanding branch audit coverage, and promoting the adoption of Internal Audit Standards. The discussions also highlighted the growing role of technology in financial reporting and assurance, alongside the evolving competencies of Chartered Accountants in information systems audit, forensic accounting, cybersecurity, and digital assurance. Further, the Institute also proposed recognition of its certifications by the RBI for banking sector assignments.
Ind AS Implementation in the Insurance Sector
The implementation of Ind AS in the insurance sector marks a significant step towards greater transparency, comparability, and global alignment in financial reporting. Recognising the need for a smooth transition to Ind AS and sector-specific nuances involved, ICAI has been playing a proactive and leadership-driven role in supporting this transition. Through its Accounting Standards Board, the Institute has been closely engaging with key stakeholders, including IRDAI and the Institute of Actuaries of India, to address practical challenges and provide implementation support and guidance. ICAI’s participation in the Joint Expert Group constituted by the IRDAI further reflects the profession’s critical role in shaping workable solutions. Alongside this, the Institute continues to drive capacity building through various initiatives, including research on global practices under IFRS 17, specialised initiatives such as the deep dive course on Ind AS 117, development of e-learning and educational material, to equip members to confidently navigate and lead this significant transformation.
Accounting Standards Day
ICAI celebrated Accounting Standards Day on 25 April 2026, at multiple locations, including Delhi NCR- Gurugram, WIRC-Mumbai & Pune, EIRC -Kolkata, and SIRC-Chennai. The occasion was graced by distinguished speakers and regulators, including Sh. Anand Mohan Bajaj, Deputy C&AG, Shri P. Daniel, Full-time Member NFRA, Sh. Rajay Kumar Sinha, Member (F&I) IRDAI, Ms. Preeti Chandrashekhar, President, Institute of Actuaries of India (IAI), Ms. Asha Murali, Secretary and Council Member, IAI. This celebration highlighted the important role that robust accounting standards play in promoting transparency, consistency, and credibility in financial reporting. Strong and globally aligned standards not only build investor confidence but also enhance the attractiveness of India as a preferred investment destination. It is through this standard-driven reporting framework that the profession continues to support confidence in markets and contribute meaningfully to the nation’s growth journey.
UDIN: Enhancing Credibility and Accountability for Regulators, Banks and Stakeholders
Since its inception, UDIN has evolved into an important tool for strengthening the credibility and reliability of documents certified by professionals. Over time, it has traversed a long path and achieved significant scale, with more than 10.57 Crores UDIN generated, emerging as a reliable instrument for regulators, banks, and government authorities, supporting informed decision-making through enhanced transparency and authenticity. The Institute will be supporting the Ministry of Home Affairs in its Project FCRA 2.0 through the integration of UDIN verification, thereby reinforcing real-time validation and minimising the risk of fraudulent certifications.
Simultaneously, member-centric reforms such as the introduction of field-level validations and a ceiling on UDIN generation for tax audits reflect a strong commitment to professional discipline and regulatory compliance. The incorporation of Form 146 in line with the Income-Tax Act, 2025, further demonstrates responsiveness to the evolving legislative framework.
With widespread adoption and increasing usage across stakeholders, UDIN today stands as a strong pillar supporting trust, accountability, and credibility in the profession.
Expert Panel: Strengthening Audit Quality and Professional Support
With advancements in the business environment, marked by increased complexity in regulatory and reporting frameworks. In such a dynamic setting, expectations from auditors continue to grow with greater emphasis on consistency, clarity, and quality in audit practices. Recognising these emerging needs, the Institute has taken a proactive step by constituting an Online Expert Panel to support practising members in enhancing audit quality, particularly in the statutory audit of entities. The focus will be on addressing key auditing challenges and providing timely, practical guidance on critical aspects of audit engagements.
I am sure that the panel will serve as a valuable platform for knowledge sharing and professional guidance, supporting members in navigating the evolving professional landscape.
All India MSME Associations Meet 2026
The ICAI recognises the significance of MSMEs in the growth of the Nation, especially in terms of employment generation in realising the vision of a self-reliant India. ICAI continuously endeavours through various initiatives to empower the MSME ecosystem for value creation. Recently, the Institute successfully organised the All-India MSME Associations Meet 2026 in virtual mode, which was graced by the esteemed presence of Smt. Smriti Irani Ji, Former Union Minister, who lauded the commendable initiatives undertaken by the Institute to support MSME’s and startups. These initiatives demonstrate ICAI’s active role in facilitating the growth and development of MSMEs at the grassroots level.
The high-level virtual meet was attended by more than 100 delegates, and deliberations focused on promoting financial and digital inclusion, enhancing access to finance, encouraging the formalisation of businesses, and creating a robust platform for knowledge sharing and future joint initiatives.
Conclusion
As the adage goes, Rome was not built in a day . Our vision of national development extends beyond a growth narrative; it is driven by structural and regulatory reforms, technological advancements and effective execution supported by enabling policies that promote inclusion. Our progress is not merely reflective of the growth rate; rather, its true measure lies in improving ease of living and ensuring inclusive, holistic development that reaches the grassroots level.
India’s canvas is huge with multiple stakeholders of varying economic backgrounds, and rightly, our aspirations and the journey towards Viksit Bharat @ 2047 - Sabka Saath, Sabka Vikas has to build upon the domestic resilience and innovation continually to promote inclusion and capacity building. To realise our dream in its truest form, we must work with collective resolve, perseverance and a clear vision of transforming our aspirations into actions and meaningful reforms to bring results.
As the country surges forward on its path to progress, becoming a globally respected economy, our profession carries a larger responsibility of upholding trust and continually meeting the expectations and aspirations of stakeholders; ensuring that growth is not only inclusive but also synonymous with integrity, transparency and accountability.
I am sure that the esteemed members of the profession will continue this steadfast journey with purpose, remain committed to excellence with ethics and integrity, and play a pivotal role in realising the vision of Viksit Bharat.
CA Prasanna Kumar D
President, ICAI
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