The Hindu Business Line : Occasional knuckle rapping

TWO auditors of the fallen Madhavpura co-operative bank have come under the wrath of the Institute of Chartered Accountants of India (ICAI). Strongest disciplinary action has been recommended in the form of "removal" — of one auditor for two years and the other for five years — since they have been found guilty of "professional misconduct".

Removal not from the country or Gujarat, but from the `register', as Section 20 of the Chartered Accountants Act would explain. Thus, the Council removes from its Register of Members, names of not only those who are dead but also fee-defaulters and those guiltyas in the case of the Madhavpura bank. Section 22 of the Chartered Accountants Act defines `professional misconduct' as any act or omission specified in any of the schedules.

For non-accountants, these schedules will make interesting reading. For instance, a practising CA is prohibited from: allowing any person other than his partner or employee to practise in his name; sharing his fee with non-CAs; securing professional business through person not qualified to be his partner or by means not open to him; soliciting clients or professional work by circular, advertisement, personal communication or interview or by any other means; accepting a position previously held by another CA without first communicating with him in writing; and mixing clients' money with his own.

Contrary to popular belief, the ICAI's regulations speak of `professional misconduct' in employment too. For example, an employee CA is prohibited from paying, allowing or agreeing to pay or allow directly or indirectly to any person any share in his emoluments; also, he is prohibited from disclosing confidential information acquired in the course of his employment except as and when required by law or except as permitted by the employer.

Professional misconduct can be spotted across professions and across the world. For example, the day's news on http://news.scotsman.com speaks of one Miller "struck off by the Scottish Solicitors' Discipline Tribunal after being found guilty of professional misconduct". Let's move on to the medical field. "Public reprimand of doctor makes history" proclaims a headline on www.globetechnology.com recounting how the Ontario College of Physicians and Surgeons conducted an open hearing and reprimanded a doctor who was found guilty of "writing prescriptions for US patients whom he had not seen". What is supposed to govern the medical profession is the Hippocrates Oath of 400 BC. "Whatever, in connection with my professional practice or not, in connection with it, I see or hear, in the life of men, which ought not to be spoken of abroad, I will not divulge, as reckoning that all such should be kept secret," is one of the translated lines on www.med.howard.edu emphasising confidentiality.

`Code of Conduct' is essentially "a set of professional ethical standards regulating the relationship of Chartered Accountants with their clients, employers, employees, fellow members of the group and the public generally", explains www.icai.org.

In an ideal world, all professionals maintain ethical standards, giving little room for any public discourse of misconduct. "However, human nature being what it is, a man may often place his personal gain above service," concedes the ICAI. "Therefore, it is necessary to keep on reinforcing the idea of keeping up and observing the highest ethical standards repeatedly," it adds, reserving the power to wield the stick, as if affirming Iago's statement in Othello: "Blood and baseness of our natures would conduct us to most preposterous conclusions: but we have reason to cool our raging motions."

AccountSpeak@TheHindu.co.in

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