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Companies can access all services of CA-CS-CMA from one source soon

Posted Date : 25-Mar-2015 , 08:48:42 am | Posted By CASANSAAR print Print
In a move that could significantly alter the road map of corporate compliance, audit and consulting, three professional bodies (ICAI, ICSI,)are preparing a regulatory framework to allow a single entity to provide all such services to a company as early as this year. 

The Institute of Chartered Accountants of India, the Institute of Company Secretaries of India and the Institute of Cost Accountants of India are finalising guidelines to make multi-disciplinary partnerships (MDPs) operational in India so that audit, accounting, tax, legal and business consulting services could become available under one roof. 

The proposed regulations will allow MDP professional firms to be registered as limited liability partnerships. 

"We are sorting out administrative issues such as form listing, regulatory framework and other arrangements. MDPs will become operational within this year itself. Our coordination committee is working towards it," ICAI President Manoj Fadnis told ET. The creation of MDPs, which is provided for in the Companies Act 2013, will be a boost to the Big Four - Deloitte, PricewaterhouseCoopers, EY and KPMG, the largest firms that offer tax advice and management services globally. 

The argument in favour of MDPs is that getting compliance services from a single firm - as opposed to multiple firms - can reduce costs and save time. 

Experts say international experience can be useful in setting up these processes so that concerns over conflict of interest, especially if consultancy is bundled in, are addressed. Several countries have created safeguards to avoid the risks associated with combining accounting and consultancy under one umbrella. 

"As per the law, there's a Chinese wall to prevent such risks. Enough safeguards have already been put in place, such as requiring auditor partner approval if the consultancy work has to be done by the same firm for the audit client," said Harinderjit Singh, a partner at PwC. "The code of conduct set Chiby the chartered accountants institute is a safeguard in itself. And the professional bodies can put together strict rules, as done globally," said Sai Venkateshwaran, partner, accounting advisory services at KPMG in India.

Companies can access all professional services from one source soon 

This concept is popular in countries including the UK, Germany, Italy, the Netherlands, Slovak Republic, Spain, France and Belgium. "All the needs of a client such as getting a licence and launching a venture or project, mobilising funds in the market, restructuring, mergers, acquisitions and the task of complying with requirements prescribed under various statutes can all be effectively handled by the MDP," said Singh. Transfer of data and information about a client from one division to another within the same firm would be much easier and faster. 

"Business structures are so complex that companies now need holistic advice. MDPs will be better placed to provide that in an expeditious manner. A lot of information was lost in the cracks between single-discipline firms," said Sai Venkateshwaran. Experts say the concept could also help globally competitive professional firms in the country. 

"For firms, an MDP helps with branding, growth across geographies, scale of economy and specialisation. MDPs can enable the emergence of global professional firms out of India," PwC's Singh added. (Economic Times)
 
 
 
 

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