CA panel tastes blood, wants more

The Chartered Accountants' Action Committee (CAAC) is asking the Institute of Chartered Accountants of India (ICAI) for more.

Upping the ante on multinational accounting firms (MAFs) and their practices in India, the CAAC is now asking the ICAI to address issues related to surrogate advertising and performing attest functions without proper authority being vested in them to do so.

The new move comes less than a week after the ICAI's central council decision restricting Indian audit firms from tying up with foreign management consultants which offer audit services abroad under the same brand. These practices were termed as "illegitimate and unethical" by the CAAC.

S Gurumurthy, convenor of CAAC, has also requested the Department of Company Affairs and the government to take serious note of the Central Council's suggestions and recommendations.

Welcoming the recent decision taken by ICAI, S Gurumurthy, convenor of CAAC, said, "However, CAAC is of the strong view that transgressions by the MAFs that have already taken place should also be addressed by ICAI. These transgressions include surrogate advertising, performing attest functions without authority and activities of MAFs which were called as 'circumvention of the law of land' by the ICAI itself more than a year ago.

In his message to the media Gurumurthy said, "CAAC records its particular appreciation of the Council for its decisions a) to request the authorities to review the operations of MAFs engaged in the accountancy services, b) to reinforce regulatory restrictions on surrogate advertising in regard to certain management consultancy firms having familiar names to accountancy firms c) to recommend to the government to take re-look at the opening up of these sectors prematurely and d) to recommend a curb on non-CAs/MAFs to perform attest functions."

"These decisions are in consonance with the demands made by CAAC in its white paper and in the memorandum to ICAI and hence CAAC justifiably feels vindicated," he added.