The Institute of Company Secretaries of India (ICSI) — the apex body to regulate company secretaries — would soon allow networks among company secretary (CS) firms by using collective resources like infrastructure, manpower, and location for execution of professional services of one or more types.
Both, CS firms and individuals practicing as company secretaries can make networks by pooling their resources to serve their clients. “This type of inter se arrangement makes a lot of business sense, as the number of CS firms in the country is less; therefore, establishing networks in terms of resources would help in reaching out,” said N K Jain, CEO and secretary of ICSI.
A network would need to be registered with ICSI and there would be a set of guidelines and code of conduct to be followed by such networks. The network only acts as a facilitator for its members/constituent member firms to perform their professional assignments.
The guidelines are being finalised by the Institute. However, for taxes, the firms would be assessed separately in the inter se arrangement. At present, there are about 3,200 practising CS in the country, while the number of CS firms is 1,430.
The other two professional bodies, the Institute of Chartered Accountants of India (ICAI) and the Institute of Cost and Works Accountants of India (ICWAI), which regulate the profession of chartered accountants and cost accountants, respectively, had made such network provisions available for their members earlier.
It’s been four-five years since ICAI allowed networks among CA and CA firms. However, it hasn’t been successful and hasn’t really caught on, said an ICAI member. There are regulatory issues that need to be cleared, he added. Registering with ICAI is optional for CA networks.
Likewise, ICWAI’s council had approved this kind of arrangement about three years earlier, but it is done at an individual level. “It is a new concept and we are waiting for the limited liability partnership (LLP) model to be picked up, under which CAs, CS and cost accountants can create multidisciplinary firms”, said Chandra Wadhwa, past president, ICWAI.