Policy Watch
Big Four Affiliates Ignite Fierce Battle for ICAI Posts, Making Elections More Intense Than Ever!
The Institute of Chartered Accountants of India (ICAI) has officially announced the schedule for its 2024 elections to constitute the 26th Central Council and the 25th Regional Councils. This democratic exercise will be held on December 6th and 7th, 2024, aiming to shape the future leadership of the prestigious institution.
The elections feature a competitive lineup, with 81 candidates vying for 32 seats in the Central Council and 158 candidates contesting for 64 seats across the Regional Councils. These positions are crucial for driving policy decisions and overseeing the governance of the ICAI, a body established under an Act of Parliament.
The voting process will involve 925 booths strategically placed across India to facilitate seamless participation. Over 4,03,619 members of the ICAI are eligible to cast their votes in this pivotal election, reflecting the democratic ethos of the organization and its commitment to member engagement.
ICAI’s elections are significant for the accounting profession in India, providing an opportunity to elect leaders who will play an instrumental role in shaping the profession’s future. The elected representatives will focus on advancing professional standards, enhancing global recognition of Indian Chartered Accountants, and addressing challenges faced by the fraternity.
Members are urged to participate actively, as their votes will directly influence the policies and vision of ICAI for the coming term. As the tagline emphasizes, “Your vote shapes the future of the profession.”
Leading professional services firms are advocating for increased representation in the ICAI Council, believing it will amplify their influence on key issues impacting the profession.
In recent months, the Institute of Chartered Accountants of India (ICAI) has adopted a more assertive approach, particularly in response to the growing authority of the National Financial Reporting Authority (NFRA). The ICAI’s disciplinary committee has imposed stringent penalties, including bans and fines, on firms for violating the Chartered Accountants Act. These violations included activities like paying referral fees and leveraging global network names for publicity, which contravened ICAI guidelines.
The institute has also clashed with NFRA over proposed changes to auditing standards. For instance, ICAI recently requested a halt to the revision of Standard on Auditing (SA) 600, which governs group audits, a move seen as favorable to the Big Four firms. Additionally, firms have raised concerns over ICAI’s proposed international networking guidelines, which would mandate greater transparency regarding non-audit operations and global network structures.
In FY24, the combined revenue of PwC, Deloitte, EY, and KPMG surpassed Rs 39,000 crore. EY led the market with over Rs 13,500 crore in revenue, excluding GST, employee costs, and outsourced IT expenses. Audit affiliates of the Big Four alone contributed Rs 4,300 crore, with SR Batliboi, EY’s affiliate, generating Rs 1,300 crore in audit and advisory fees.
“There is a need for our perspective to be represented in the council. Recent actions against firms suggest our viewpoint has been overlooked. All Big Four affiliate firms are entirely Indian-owned, so the distinction between global and Indian operations is unclear,” said a Big Four auditor who requested anonymity.
The elections come amid heightened tensions between NFRA and ICAI, particularly over SA 600 and other regulatory measures. In a recent development, NFRA declared ICAI’s new Standards of Quality Management legally invalid, raising questions about the institute’s authority.
“The role of ICAI’s councils is increasingly uncertain as NFRA emerges as the dominant regulator for practicing members. The central and regional councils must redefine their relevance in disciplinary and regulatory matters,” remarked a partner at MGB.
Industry observers stress the need for robust leadership at ICAI as the profession faces rapid modernization, technological advancements, and growing government oversight.
