Accountants, auditors told to update themselves to keep up with the current accounting scenario

PR Ramesh, veteran chartered accountant and chairman of Deloitte India on Saturday urged the accountants and auditors to update themselves to combat the fast changing accounting scenario in the country. “The changes that have taken place have made things very complicated for auditors and accountants and unless they train themselves the profession would be taken over by someone else,” he maintained.

He was speaking at the Annual Conference – 2016 on the theme “Peeling Inner layers of Legislative Changes” organised by ACAE Chartered Accountants’ Study Circle – ERIC at a hotel on Saturday morning. He said lots of changes had come up in accounting and auditing arena because of the Income Disclosure Scheme, Real Estate (Regulation and Development ) Act, 2016, Companies Amendment Bill, 2016, Goods and Service Tax (GST).

In the past, changes in so many laws did not occur at the same time. As a result, the accountants are confused and the only way to combat the situation is to update themselves.

There are numerous disclosures, sensitivity analysis, leases, accounting for business combination etc have made the accounting system very complicated. With this backdrop the nature of clients has been changing fast. Earlier, the clients used to depend on the chartered accountants blindly but now most of them are tech-savvy and their relations with the accountants are changing.

The business profile of the clients has undergone changes over the years. Integrated accounting is coming to India in near future and so “Knowledge beyond debit and credit will be required to do accounting.”

Himanshu V Kishnawala said major changes have taken place in Corporate Laws in the past few years and auditors and accountants should be extra cautious.

The National Company Law Tribunal (NCLT) has come up to hear cases that were under the Company law Board. The National Finance Reporting Authority (NFRA) will come up soon and the authority will have the power to probe into the auditing done by a firm to see whether proper legal methods have been followed.

The authority will have three committees to do the investigation. The chartered accountants have objected to the proposal “But whether we like it or not it is going to come soon,” he remarked.

Kamal Nayan Jain, chairman of the conference committee said understanding legislative changes required great amount of analytical skill. Clear cut methodology is required to assess the impact and for their implementation.