From the Viewsroom

Dealing with accounting excesses

KR Srivats | Updated on January 13, 2018 Published on February 19, 2017

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Temporary suspension of CAs is wrong in principle

Proving misconduct of professionals and bringing them to book, be it a doctor, a lawyer or an accountant, is not an easy task. The labyrinthine legal system can frustrate the best efforts to punish wrongdoers.

The ball is clearly in the court of the Institute of Chartered Accountants of India (ICAI). Its image had taken a beating after the slew of corporate wrongdoings over the last two decades, prompting the Government to consider setting up a separate regulator. To its credit, it has — with government intervention — overhauled its disciplinary mechanism post 2007. However, much more needs to be done if the public perception of the CA Institute being a “club” that protects the interest of its members is to be changed.

But newly elected CA institute president Nilesh Vikamsey’s remarks that the institute is toying with the idea of “temporary suspension” are not encouraging. Temporary suspension is a power that is open to misuse. Proceedings against professionals are “quasi-criminal” in nature. Hence, it is imperative that the accused entity gets the chance to be heard before the institute suo moto resorts to temporary suspension. Allegations must be substantiated.

What happens if a chartered accountant is suspended temporarily and the courts rule ‘not guilty’? The stigma will remain with the professional all through his or her life.

The institute would become judge, jury and executioner all in one if it were to hear the case of an individual or entity it has temporarily suspended. It would like to see its suspension order quashed.

The best approach, if at all the CA institute wants to introduce ‘temporary suspension’, is to derive the power from the Government to move the High Court. Let the High Court take the call on the matter.

Deputy Editor

Published on February 19, 2017
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