Indian Institute of Accounting: What is it? Whats my future now?

Stating it simply, IIA will be similar to Indian Insitute of Management or Indian Institute of Technology which will be set up in different parts of the country. Students will be required to appear for an Entrance Test (Like CAT for IIM) & after passing the same, students can take admission in IIA and after completion of the Course, students will have an Undergraduate Degree. Qualified candidates can then apply for License to Practice (similar to Certificate of Practice for CAs) with relevant Licensing Authority (like NFRA or others not currently decided). The License holders will be called Certified Professional Accountants.

Definitely Not. The motto of setting up IIA is to eliminate monopoly of ICAI & create competition for chartered accountants. In future students will have the choice to either become Chartered Accountants by pursuing CA through ICAI or become Certified Professional Accountants through IAA.

Currently it is only presented as a suggestion in 45th report of standing committee on finance. Law for setting up such entity & then its formation will take time (just in case the proposal gets aprroved by parliament)

There will be internships definitely but currently there is no such points mentioned as to what will be duration and other terms of same.

CPAs will be given a license to practice similar to CAs. But what will be their role in governement bodies, what exactly they can do as CAs do etc all these points will be planned later on as there is no specific mention of it in proposal.

In any industry competition is always good. The only difference now is earlier we were competing with our own people of same institute that is ICAI but in future we will have to compete with members of other body who are from IIA. Quality always overpowers quantity. There is so much to unfold. But a competent passionate professional always finds his/her place irrespective of the crowd who claims they are same as you (But they are not).

Sure. Here you go.

During the course of evidence, the representative of Ministry of Corporate Affairs stated as under:
“In the US, for taking a license, you have to go to State Board of Accountancy. For public listed companies, there is Public Company Accounting Oversight Board (PCAOB). It has to be independent from the profession. The American Institute of Certified Public Accountants (AICPA) is a voluntary organisation but they cannot give license to practice. In fact, they are conducting seminars. May be, they are also suggesting syllabus through which the CPAs should appear in exam. Exam is conducted by National Association of State Boards of Accountancy(NASBA) and State Board of Accountancy.

In the US, there are 56 State Boards of Accountancy.. In California, there are 15 members — seven professionals and eight lay members. In Alabama, it is one lay member and six professionals. But all are appointed by the Government. They are not getting appointed by the Council. There would be the State Chartered Accountant bodies but they are not regulating themselves. Here, ICAI is giving license and conducting exam. That is why, we have said it is statutory monopoly.

It is doing everything unlike USA where awarding of license is with the Government, cancellation of license is with the GoVernment. It is completely regulated knowing the sensitivity and importance of the profession. Who will be appointing the Members of Board of Accountancy? They are appointed by Governor, Senate or Speaker. The AICPA is only becoming an organisation where if you want to get benefit out of something and you become a member. That is a major difference.

To practice in USA, you need not become a Member of AICPA. I may not be obliged to take the membership of AICPA to practice, can take a license from the Government and practice.
Here, you have to take a license from ICAI, certificate of practice. Without obtaining a certificate of practice, you cannot practice. That means it is completely controlled by one Institute. There is no competition also to develop the profession unlike in other countries where there are multiple bodies competing with each other and developing the profession.”

3.34 The Ministry also provided the following information regarding
Qualification and licensing in various countries:
USA
Activities are performed by multiple bodies:
Examination for CPAs is conducted by American institute of Certified Public
Accountants – AICPA (a voluntary professional organization of CPAs at

National Level). National Association of State Boards of Accountancy-
NASBA (a Not For Profit Organization) gets the scores from AiCPA and transmits to the State Boards of Accountancy (SBAs – Govt. Bodies), which make scores available to the candidates
License to practice/ revocation of license by SBAs (not by AICPA or State Societies of CPAs)
CPAs need not be members of AICPA
UK, South Africa and Australia

Activities are combined but performed through multiple bodies — SROs, which are Non-Governmental Bodies
Canada
Activities are combined but performed through multiple Statutory Provincial Bodies — Statutory SROs

3.35 On the above issue, an independent witness submitted the following suggestion: “Establishment of Indian Institutes of Accounting. This proposal is for establishing a string of Indian Institute of Accounting (IIA) that will raise the standards of accounting education and offer competition to the Institute of Chartered Accountants of India.

Here’s an outline of what the IIAs would be like:
The IIAs will be statutory bodies established by a Central law similar to IITs and IIMs.

They will be set up in different parts of India.

Each IIA will have a board of governors consisting of experts, lay persons, and government officers drawn, among others, from the Ministry of Finance, the Ministry of Education, and the Ministry of Corporate Affairs. The board size will be ten.

The board will have full functional, financial and administrative autonomy for its efficient functioning.

The chairman and the members will be eminent persons from business, public administration, accountancy, finance, academia, and so on.
The board will appoint the chairman and the members and they must be free from conflict of interest of any kind i.e. professional, financial, or personal.

The chairman and the members will serve part-time and will have a term of three years. They shall not be eligible for reappointment or extension in order to avoid entrenchment and to bring in new talent regularly.

The board will appoint a Director (CEO) for a term of five years. The Director shall not be eligible for reappointment or extension in order to avoid entrenchment. This is particularly important because the board is part-time and the Director could develop deep roots.

Each IIA will have an Academic Council that will develop the curriculum. The undergraduate curriculum will have financial and cost accounting, auditing, tax,law, business strategy,organisational behaviour, management, governance and public administration, technology, data science, psychology and other fields relevant to the wide role that accountants play.

IIAs will start with a five-year undergraduate programme in accounting. Overtime, they will develop post-graduate programmes in specialized areas such as forensic accounting, buSiness analytics, cyber security, valuation, international tax, and other relevant ‘fields. Once these programmes stabilise, they will develop PhD programmes.

Admission will be through a national entrance test after secondary schooling under the National Educational Policy 2020.

IIAs will be research-driven. They will support research and publications efforts by their faculty generously.

IIAs will work closely with national and regional educational institutions such as the Indian Institutes of Management, the Indian Institutes of Technology, the National Law Universities, and other universities and institutions.

From the beginning IIAs will have an international outlook. They should have students from all over the world including from developing countries. They should aim to get the best faculty from around the world. They should price their education reasonably and provide liberal financial aid to needy students. Access, equity, inclusion, diversity, and fairness are important. They should work to raise endowments from industry.

Those who qualify in the undergraduate programme will be given two degrees, a Bachelor of Accounting and a Bachelor of Business. This will
give them a choice of the stream they want to go into.

They will be given a licence to practise similar to CAs. The licence-holders will be called Certified Professional Accountants (CPAs) They will be required to register themselves with a Central Licensing Authority (such as NFRA) which will handle their disciplinary matters.

The proposal visualizes the lIAs as academic institutions that educate licensed professionals similar to AIIMS, PGI, JIPMER, National Law Schools, and so on. In contrast, the Institute of Chartered Accountants of India will be a professional certification agency, much the same way it is now.”

3.36 During the course of examination of the Bill and scrutinizing global practices with regard to the profession of accountants, it has been observed that the qualification and licensing of accountants in advanced countries like US, UK and Canada is done by multiple bodies unlike in India where one Institute has statutory monopoly over the whole profession. As such, the scope for improving the quality and competency of the profession remains limited.

The Committee during their deliberations feel that multiple bodies on the lines of advanced countries is required in order to promote healthy competition, raise the standard and quality of auditing and accounting and improve the credibility of financial reporting. The Committee desire that the Government should consider setting up of Institutes of Accounting CIA) akin to IITs and liMs for further development of the accounting and finance profession in the country.

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