Government intends to tighten accountants disciplinary mechanisms

The government intends to tighten the disciplinary process and streamline the operations of chartered accountants, company secretaries, and cost accountants through legislative reforms in the current session of Parliament.

Nirmala Sitharaman, Minister of Finance and Corporate Affairs, will table a bill in the Lok Sabha on Friday. The Chartered Accountants, Cost and Works Accountants, and Company Secretaries (Amendment) Bill, 2021, displayed the House’s altered business schedule.

The Chartered Accountants Act, the Cost and Works Accountants Act, and the Company Secretaries Act would all be amended by the Bill.

The modification According to a person acquainted with the development, the bill will modify the disciplinary mechanisms of the three professions and streamline the operations of the three institutes that govern the professionals. According to a person who spoke on the condition of anonymity, the Bill will improve the functioning of the Institute of Chartered Accountants of India, the Institute of Company Secretaries of India, and the Institute of Cost Accountants of India.

The move is also expected to result in faster decision-making in professional disciplinary matters.

The endeavour to overhaul the professional disciplinary system is part of an effort to strengthen corporate governance and the quality of crucial statutory document drafting and reporting.

Chartered accountants are important in the creation and audit of financial statements, whereas company secretaries are important in completing legislative requirements.

Cost auditors are essential in industries where the use of resources and energy requires regular monitoring and has an impact on the competitiveness of the organisation.

Auditors, accountants, and company secretaries are regarded as the initial corporate governance gatekeepers, on whom the legal structure relies.

The government is likewise eager to rectify the loopholes in the three institutes’ self-regulation of professionals.

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