Concept Paper. Concept Paper. Indian Chartered Accountants in Public Service Approach for Global Brand Building Exercise in the Knowledge Based World

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1 Concept Paper On Indian Chartered Accountants in Public Service Approach for Global Brand Building Exercise in the Knowledge Based World Those who are willing to contribute to the endeavours of the Committee for Members in Industry of ICAI, Kindly get in touch with us at The Institute of Chartered Accountants of India (Set up an Act of Parliament)

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3 Contents Chapter Particulars Page No. 1. Prelude 4 2. Environmental Analysis 6 3. Global Brand Building Exercise for Indian CAs Strategic Measures Operational Measures 15 A Annexures Terms of Reference of the Committee on Members in Industry 18 B CMII Organisational Structure 20

4 1 Prelude The Institute of Chartered Accountants of India (ICAI) has been established for the regulation and development of the profession of Chartered Accountancy in India. During its sixty years of existence, the Institute has achieved recognition as a premier accounting body not only in the country but also globally, for its contribution in the fields of education, professional development, maintenance of high accounting, auditing and ethical standards. ICAI now is the second largest accounting body in the world. The Institute functions through its Central Council which has constituted four Standing Committees 1 and thirty five non-standing Committees. Various endeavours of the Institute are duly supported by five Regional Councils and 117 Branches spread all over the country. The Institute has also set up 22 chapters outside India and has an office at Dubai. The developmental initiative of ICAI starts from enrolling the students for the pre professional course and continues to the level of prescribing best practices in the areas of Accounting, Auditing, Internal Audit etc. as well as publishing books to maintain core competencies of the members of the Institute as well as development of knowledge base of the members of the Institute. Currently over students are pursuing the CA course and the total membership of the Institute is about Around 47% of the members are in industry. 1 Source: ICAI At a Glance,

5 One of the non-standing committees of the Institute is the Committee on Members in Industry, which primarily, takes care of the development of the Chartered Accountants serving in industry. Over the years the Committee has become one of the most prominent subsystems in the ICAI acclaimed for its developmental role for the benefit of the members in industry and improving the overall brand image of the CAs and the ICAI. This concept paper is indented to further enhance the contribution of the CMII so that the due recognition for the CAs is realised in industry within India and abroad.

6 2 Environmental Analysis Every professional be in practice or in service - has to be responsive to the environmental challenges. Institutions that take care of the development of such professionals have to make appropriate and time bound actions so that the strengths of the profession are converted into opportunities and the weaknesses, if any, would be taken due care so that the threats would not have any notable impact on that profession. The following checklist provides a bird s eye view of the environmental challenges and the possible action plan for the CAs. Environment & Challenges to the Accounting Profession 2 Unrelenting Competitive Pressure To win business, the Indian Chartered Accountants will need to provide value added services, which would help business become more competitive. Industry specialisation and detailed understanding of clients' business will underpin the ability to add value. The strategies to progress specialisation will be required to add value to the C.A. designation. Impact of Information Technology (IT) and Communications 2 Members in industry focused. Based on Vision 2021 document of the Vision Committee of ICAI

7 Significant resources will be required to develop the following technologies which will be sought by CAs: Electronic Networking/artificial intelligence system to interpret, model and predict business trends. The systems to deal with specific audit judgements (e.g. Stock Obsolescence, Stock Option Valuation). Integrated system to direct and reconcile transactions between trading partners. Rapid Change in Business Environment The profession will need to become pro-active and agile to meet the rapidly changing needs of business. Partnering with other service providers will be necessary to deliver some of the services required by business. CA's will need to address complex accounting issues, such as, those relating to off balance sheet arrangements, derivative instruments, etc. Globalisation of Business Knowledge of international corporate law and precedents will be required. The Institute will need to support CAs and business via Education and Dissemination of the Information and advice. The profession will have the opportunity to lead the way in dropping barriers to trade in services. The Members will seek assistance from the Institute on global compliance issues.

8 Movement towards Global Manufacturing Alternatives and Opportunities The CAs qualification will need to be internationally recognised and reciprocally accepted. The Institute will be presented with opportunity to hold and assist business and the Members down the globalisation path. The Institute of Chartered Accountants of India may be called to address human resources issues affecting Members working for global enterprises. Focus on Value: Increasing and Changing Accountability The profession will need to develop the thinking and methodology for the measurement of value to reflect growth and intangibles. The Institute has the opportunity to lead the introduction of performance reporting via education and dissemination of information. The Institute will need to incorporate advanced corporate finance in the professional training undertaken of CAs. International Measurements To compete for global capital in the global market, Indian CAs will need to adopt international best practices. The Members will look to the Institute to lead in the adoption of international best practices. Pressure to Enhance Shareholder Value The Profession will need to promote shareholder value (e.g. scenario planning, options etc.) as a core Chartered Accountants competency.

9 The Institute will need to enhance the support of the Members' role in shareholder value by: Researching the needs of business and members. Developing appropriate education programmes. Positioning the profession as the premier supplier of new assurance and non-traditional value measurement services. The Future Business Professional The role of Chartered Accountants will be changed from the past historical focus to a more pro-active role. Finance professionals, strategic thinkers and `value adders' will succeed. In recognition of the changing nature of the competition, professionals must move towards risk management and corporate Governance. The Institute will need to address the changing educational requirements of Members particularly in following areas: o Corporate finance. o Capital and Financial Markets. o Strategic Planning. Specializations The CAs will have the opportunities to compete against and/or to form alliances with specialist organisations. Specialisation will replace the service vs. public practice Membership dichotomy. To maintain relevance, the Institute's Member services will need to reflect the increasing and diverse specialisation among the Membership.

10 Promotion of Chartered Accountants designation will need to emphasize both the traditional Chartered Accountants strengths/core values and the CA specialisations. New Business Management Methods New Management skill will be needed to run knowledge based organisations. Outsourcing and Contracting Process and skill sets will replace organisational structures based on function. CAs will work in the virtual market place rather than big organisations. Consequences for the Institute The Institute will need to define its role with respect to outsourcing and the impact of outsourcing on the independence of CAs. Demand for New Knowledge and Skills: Information Management Skills CAs will source and present specialist information. CAs will need to partner with experts in communications. The Institute will need to operate as a knowledge based organisation by adopting the appropriate structures and delivery mechanisms for its educational and other products. Qualifications International recognition of Chartered Accountant designation will need to be extended so that CAs can successfully compete in all major markets.

11 Existing Membership reciprocity agreements will need to be maintained and extended. Te Institute will need to be more flexible with respect to pre-requisite qualifications for entering into its professional programme. Education programmes will need to deliver two types of knowledge - Industry specific and generalist. To ensure a quality premium for Indian graduates, the Institute will need to: Identify what is based on practice and influence University curriculum. Interface with Government and Business. Place pressure on Government to lift education standards. The Institute will have the opportunity to create a learning environment that integrates financial and non-financial performance models. Education programmes will need to accommodate training on nonfinancial measurement. Globalisation of Business Community CAs will require detailed knowledge of international accounting and tax systems. Globalisation and liberalisation will impact on accounting firms in the same manner as business. The profession will be segmented into two groups - Those who are involved internationally and those who are not. The Institute will operate with the challenge of meeting the needs of disparate Membership group. Unless the Institute addresses the globalisation issues, it will remain relevant only to those Members who operate locally. Globalisation of Chartered Accountant programme will be essential for Members who provide services to transnational clients/employees.

12 Changing Attitudes to Work/Family Issue and Changing Work Environment Demand for Knowledge based Workers Challenges to Indian CA will include: o Management of Information Technology. o Change Management Career in Intra (Cross Function) and Inter Organisational Success The Institute has the opportunity to develop strategic alliances to facilitate Members' career progress and thus, to maintain Member loyalty.

13 Global Brand Building Exercise for 3 Indian CAs The Indian Chartered Accountancy course has successfully got the image as Complete Business Solutions Provider. Course curriculum, training and the examination methods adopted by ICAI has been acclaimed as the best in the world in grooming accounting professionals. With due and integrated methodology, the expertise of Indian CAs could be marketed throughout the World leading to appreciable level of opportunities for Indian CAs in the earliest possible time. The integrated methodology envisaged in this concept paper covers strategic measures and operational measures. While the strategic measures focus on a five year timeframe, the operational measures focus on the annual work plan of the CMII with due integration of those measures into strategic measures.

14 4 Strategic Measures 1. Involve CAs with following credentials as special invitees on the CMII CFOs of top PSUs and Private Sector Companies Serving in IIMs / Institutions of national importance Serving in Ivy League Institutions abroad Officials serving in Regulatory Authorities 2. Appoint senior level MBA (marketing) and service industry experienced officials 3. Synchoronised approach with Regional Level Committees for Members in Industry 4. Become a driver for industry focused CPE Study Circles including faculty and technical support to those study circles 5. Request Branches where industry concentration is more to constitute Branch Level CMIIs with due integration of central CMII 6. Organise Road Shows in major cities abroad to market Indian CAs amongst the local stakeholders 7. Establish Result Oriented CMII Secretariat with clearly defined Key Performance Indicators (suggested organizational structure of CMII has been given in Annexure to this Concept Paper.

15 5 Operational Measures I: Newly Qualified Members focused (i) Campus Interviews with maximum possible visibility for the process and improving the outcome of the process in each and every possible benchmarks a. Conducting the campus interviews at five star hotels and / or venues having very good ambiance b. Conducting the campus interviews with same format (dress code etc.,) in all centres c. Revising the How to face interview boards by constituting an expert study group consisting of Who is Who in the Industry d. Printing world class campus interviews brochures and distribute to all possible organisations in the country e. Go for national wise advertisement campaign for popularizing campus placements i. Industry level journals ii. Export Promotion Councils iii. Federation of Indian Export Organisations iv. ASSOCHAM / FICCI / CII v. ICWAI vi. ICSI vii. SEBI Journal viii. IRDA Journal ix. Stock Exchange Journals

16 f. Involve i. State-wise task forces ii. Regional Councils iii. Branches g. To give discounts to organisations participating in campus interviews in Career Accent h. Conducting Orientation Programmes with best faculty by paying market related charges i. To conduct musical night j. To present mementoes to i. Candidates ii. faculty and iii. participating organisations II: Members who are serving in industry focused (i) Development of Core Competencies a. Conduct of Industry Focused Programmes b. Conduct of Executive Development Programmes c. Conduct of Management Development Programmes (ii) ICAI MII Relationship development orientation a. Constitution of Industry Level CMII Subgroups (minimum 20) b. Constitution of State-wise CMII Task Forces c. To publish All India Members In Industry Directory d. Conduct of Corporate Forum Meet at New Delhi e. Conduct of Corporate Accountants Meet throughout India i. Bangalore ii. Hyderabad iii. Jaipur iv. Chennai

17 (iii) (iv) v. Kolkatta vi. Surat vii. Ahmedabad viii. New Delhi (twise) ix. Mumbai (twise) To involve in ICAI Convocation Continuing Professional Education a. Developing CPE Delivery mechanism b. Conduct of Programmes III: CMII Official Infrastructure i. Elaborate and detailed budget incorporating the anticipated activities ii. To prepare yearly calendar of activities

18 Annexure A Terms of Reference of the Committee on Members in Industry Mission To encourage and enhance close links between the Institute and the Chartered Accountants working in industries in various capacities so as to provide for them, a base of reference in terms of knowledge, expertise, skills and assistance in individual career growth through the development of extensive and intensive relationship with organizations, agencies of the Government, Departments and Ministries of the Central and State Government in such manner as to provide the maximum possible exposures to the world of trade, commerce, industry and Governance, while simultaneously persuing the goal of providing the maximum of employment opportunities. Objectives To organize campus interviews with participation of all possible employer organizations for all the fresh Chartered Accountants seeking employment through the Institute. To provide assistance to members in industry for their career growth. To consider the ways and means to enhance the participation of the members in employment in the activities of the Institute. To explore and develop fresh avenues of employment for members. To provide sector specific assistance in improvement of skills of members in employment. To develop a Data Bank Sector wise listings the leading members of the Institute.

19 Additional Objectives (Suggested) Develop good practice guidance in areas of strategic importance to members in industry Promote the value added role of members in industry Proactively identify and influence internal and external stakeholders, from organizations of all sizes, on key issues related to standards, codes, regulations and public interest expectations.

20 Annexure B CMII Organisational Structure President Committee for Members in Industry Chairman Secretary, CMII Private Secretary Officer In Charge Campus Placements Newly qualified CAs CAs with three month Management Developemnt programme participatio n Officer In Charge Placements for experienced CAs Support Staff Officer In Charge Programme s Support Staff Officer In charge Publications Support Staff Accounts in Charge Support Staff Support Staff