At the outset,
let me take this opportunity to wish you a Happy New Year 2019. 2018 is a year
which will be remembered in the history of accountants and finance
professionals for a variety of reasons – both good and not so good.
The year started
with the unravelling of a massive scam of unsubstantiated LOUs issued by the
Punjab National Bank. Though it is traditionally an off balance sheet exposure,
the role of the auditors was widely discussed and criticised. This, followed by
the recent ILFS episode, brought to forefront various systemic issues and to
some extent the inefficacy of the audit process. While the ICAI has acted fast
on such issues, one thing which is evident is that the profession of chartered
accountancy has taken a turn which needs immediate course correction.
expansion plans and / or systemic diversion of funds by corporates coupled with
bad lending decisions by banks resulted in an alarming ratio of NPAs, which to
some extent were window dressed. However, recent trends suggest a good recovery
ratio of such NPAs. It appears that the new Insolvency and Bankruptcy Code is
now deriving the desired results. Despite the same, there are lots of issues
surrounding the banking sector resulting in a virtual liquidity crisis with major
public sector banks being under the prompt corrective action plan of the
Reserve Bank of India.
The tiff between
the Reserve Bank of India and the Government apparently on issues ranging from
PCA and liquidity crisis to the withdrawal of reserves took an ugly turn. This
was immediately followed by a change in guard at the helm of RBI.
The year also did
not augur too well in terms of growth in the economy. Unemployment continues to
remain an issue. Farm debt and waivers became an election issue. Coupled with
many other factors, it resulted in change in Governments in a few States.
Perhaps such incidents made the Government rethink on some of the policies
surrounding GST. The GST Council in its 31st Meeting brought in a
slew of measures to simplify the burden of the businesses and also reduced the
rate of GST on many goods and services.
The results of
the Central and Regional Councils of the ICAI have been announced. Our
congratulations to all the winners. The task before the winners is clearly cut
out. The Regional Council members will have to strive hard to improve
administrative efficiencies and provide better member services including
disseminating knowledge to the members. The Central Council members have a much
onerous duty to perform – to provide thought leadership, ensure effective
representation and also take concrete efforts for the overall development of
the profession. The Society is always available to provide constructive
suggestions in this regard and work hand in hand with the Institute.
The year ended
with a series of high profile weddings – be it Bollywood or industry tycoons.
Each of these weddings entailed a lavish display of wealth. While such
expenditure is a personal choice and is also helpful in generating domestic
employment to some extent, one wonders at the disparity in the wealth which
becomes so apparent and visible and is further fuelled by social media.
As we proceed
towards 2019, all eyes will be on the General Elections. Will it be a contest
fought on the agenda of development and growth or will caste, religion and
populism take priority? It is for the nation to decide. We as professionals can
initiate an informed debate and convince our circles of influence to cast their
professional season, this period is relatively relaxed in terms of professional
work. It is perhaps time to ponder on some larger issues facing the profession.
It is also time to sharpen the knowledge base. The Society has lined up a
series of events which are relevant for the membership at large. I trust the
members will take the benefit of the same.