R. Sivakumar on the proposed changes to CA education
THE Institute of Chartered Accountants of India (ICAI) has proposed a new scheme of education. Under this scheme, a student will be able to enrol for the Common Proficiency Test (CPT) any time after passing the Class X examination. However, one will be allowed to take the CPT only after appearing for the 10+2 examination. On qualifying, the student will have to undergo practical training for three-and-a-half years. During the training, the student will have to qualify for two examinations the Professional Competence Examination (PCE) after 18 months, and the final Examination during the last six months. The proposed scheme also requires the student to have a minimum of 100 hours of training in information technology (IT) and attended a General Management and Communication Skills (GMCS) course during the period of practical training. The increase in the term for practical training from three years to three-and-a half is in accordance with international standards. The thrust on IT training and the GMCS course are intended to produce a well-rounded professional.
With the new scheme, the total duration in becoming a CA will be around four years and not five years and and three months as it is at present.
Members and students will surely welcome the above recommendations of the ICAI council, since the present system has led to a lot of uncertainties for students with regard to articleship, time lag in writing the examination and also practical training.
However, it has overlooked some of the basic issues, detailed below.
Maturity level: This issue has been debated in almost all review committees on education. Up to 1992, except for a few years in the 1980s, the entry level was open only to graduates with over 50-55 per cent marks. In line with the new education policy, the entry level was opened to the students who passed the foundation examination of the ICAI. It was thought at that time that the subjects constituting the foundation syllabus were sufficient for admission to the articleship. However, it was felt that the maturity level of students was not up to the mark; hence it was decided, in the 1998 report, to allow only those students who passed the PE II exam to register for articleship. This change was carried out from October 01, 2001, in spite of the majority of students and members preferring that the articleship be subsequent to passing the foundation examination.
The proposed scheme envisages the entry level at a relatively younger age, that is, registration of articleship after passing the CPT. The ICAI has thus overlooked the point of maturity. However, if the intention is to equip the student with more practice so that he can take up the PCE better, it may be acceptable to some extent. In that situation a change in the pattern of examination at the CPT level is called for.
Time gap and the load: In allowing a student to register for the CPT after passing Class X, the fundamental question is whether the student will be able to take on the CPT along with the +2 examination since the subjects as well as the nature of the examination has not been clearly spelt out. If the pattern were to differ substantially, it would be too much of a burden on the student. Hence, it is necessary that the ICAI clearly spell out the pattern of examination, the nature of the question paper and the evaluation procedures.
It is on the assumption that he or she will be able to complete the CPT, that the student enters articleship. And he then has to wait for at least 18 months before taking up PCE. Assuming a student registers for CPT in June 2006, he will be eligible to take up the PCE only in May 2010, subject to his passing the CPT in the first attempt. Hence the time period between the CPT and PCE will be two years. During that time, the student will be undergoing the graduation course and the practical training simultaneously. Not having a professional examination in-between and having practical training during the two years is bound to affect the student's concentration.
Under the earlier system (the one prior to October 1, 2001) a student took the foundation examination simultaneously with the first year of graduation. This had a great advantage since the subjects for the foundation examination and that of the graduate one coincided, with not too much difference in the standard of questions and the pattern. This enabled the student to gain a little professional competence before registering for articleship, thereby enhancing his or her maturity level.
The student was allowed to take up the intermediate examination after completing one year of articleship. The time between the +2 and passing the intermediate was roughly two-and-a-half years. As far as the final examination is concerned, the student was allowed to take it up one year after passing the intermediate examination. Hence, the overall duration was four years.
The earlier system was very effective and smooth and also helped students comprehend the curriculum much better.
In comparison with other professional courses, which require a duration of four years, the ICAI is now contemplating reducing the CA course to three-and-a half years. The fundamental issue here is whether the CA course can be equated to a post- graduate one since all the other professional courses have a duration of four years. Hence it is prudent to revert back to the earlier system, that is, foundation plus three years of articleship.
The real problem: The real problem is the examination itself. Be it the earlier system or the present, or the proposed, there has been no significant improvement in the results. One of the major reasons why students fail the exam is his/her inability to comprehend the volume of the syllabus and pattern of examination. This is because the trend in almost all the professional examinations now is the semester system. Though the present pattern has its advantages, it has an inherent weakness since at all levels of the ICAI examination, the question paper is restricted to a few topics of the syllabus. Hence, there is no comprehensive coverage of the syllabus.
A major limitation: In all professional courses, such as medicine or engineering, evaluation of the practical is an integral part. Even university examinations are based on the semester pattern and include evaluation of practicals in some subjects. One of the major limitations of the CA course is that no attempt has ever been made by the ICAI to evaluate the practical ability of the student. It is time for a change in the pattern of examination and the evaluation procedures. The proposed scheme is silent on the restriction on the number of attempts. It is also not clear on the registration of articleship in case of a student completing the PE I in the existing system, the direct entry for graduates, and about the fate of so many students who were not successful under the present scheme within the limited attempts. One hopes that the ICAI will be able to convince the government on this aspect.
Considering all these facts, the earlier system seems to be an ideal choice. With the necessary change in the examination pattern and evaluation procedures, and giving due credit to the practical side, the ICAI can command a better image globally.