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ICAI to help small units get audit services

The Institute of Charted Accountant of India (ICAI) President Subodh Kumar Agrawal on Tuesday unveiled ICAI’s action plan for the current financial year (2013-2014).

Addressing a press conference in the capital on Tuesday, he said that one of the priorities of the institute would be to  collaborate  with government ministries  to draw  synergy and analogy in enhancing accountability and transparency, including public service delivery mechanisms, in the national and public interest. At the same time, ICAI would  play an increased role in various government initiatives.

Some of the suggestions made by ICAI to Finance Minister P Chidambaram were incorporated  in the Finance Bill 2013. The institute has given  representation to the Ministry of Corporate Affairs  (MoCA) and expressed its concerns over  certain issues in the Companies Bill, 2012.

There are some  key matters in the bill like the constitution of a National Financial Reporting  Authority(NFRA ), reporting of fraud by auditors,  revision  of annual audited and adopted accounts, ceiling on audit assignments, and, finally, the harsh  penalty provisions introduced in the Bill. The (ICAI) president expressed concern that that  such  provision   may have an adverse impact on the profession.

To fulfill its social responsibilities, ICAI has decide to be a part of Ministry of Corporate Affairs (MCA) initiative and seek volunteers  from its members  for offering  audit services to at least 100  auditable entities.

The target beneficiaries would be selected from those engaged in micro and small enterprises  located in remote areas  belonging to the underprivileged sections.

Agrawal has supported the cause and would  encourage more members to a be part it. The modalities for putting this into effect would soon be  discussed with the Ministry, the ICAI president informed.

The government has considered several suggestions made by ICAI and incorporated some of them were in the Finance Bill, 2013. The institute had suggested an increase in the amount of deduction in respect of interest on housing loan.

This was considered and an additional deduction of Rs 1 lakh has been proposed in respect of interest on loan taken for purchase of the first house. ICAI will seek clarification and submit further suggestions through its post- budget memorandum on certain issues arising out of this proposal.

Considering the difficulties being faced by ICAI members with regard to valuation under Section 50C, it was submitted that the section should require adoption of stamp-duty value as on the date of agreement and not on the date of registration of such a transfer.

This proposal was appreciated and incorporated in Sections 56(2)(vii) and 43CA of the Bill. In order to dissuade cash payments, ICAI had recommended a threshold limit for deduction under Sections 80GGB and 80GGC in respect of donations made in cash. This was accepted in principle.
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