Work–Life Balance & SA 600
There is a famous quote by Dolly Parton: “Never get so busy making a living that you forget to make a life.”
The age-old debate on work–life balance is back at the centre of discussion, with the deaths of a young chartered accountant and a banker on account of alleged work-related stress.
It is well known that work-related stress is at an all-time high in modern times across every segment of society in India, be it industry, profession, government departments, or even homemakers. One assessing officer confided years ago that after every assessment season, many officers develop a variety of diseases, such as hypertension, diabetes, etc., due to sheer work pressure.
Some professions or occupations are more exposed to pressures and stress, whereas at some places we find toxic work culture due to aggressive work atmosphere.
There are multiple factors leading to toxic or work-related stress. Unrealistic expectations and targets, tight deadlines, intense competition, peer pressure, etc., are some of the factors leading to stress. These factors are man-made and, therefore, can easily be controlled with proper planning and orientation.
Unfortunately, “work from home” has its own set of problems, such as extended working hours, depression, posture problems, loneliness, emotional imbalances and so on.
Whole Life Balance
The problem of balancing “work” and “life” aggravates as we consider them apart and separate from one another. Work is an integral part of our life and therefore, it is not a separate thing. To quote Sadhguru: “There is no such thing as work–life balance. It is all life. The balance has to be within you.”
Unfortunately, our education system teaches us how to make a living but not how to live a life. Systematic training / teaching is required on how to handle pressures and failures in life and live a balanced life.
People who have no work face different kinds of problems, stress and trauma. Work keeps our minds occupied and healthy. Therefore, work, per se, is not bad; it is how we do it that matters. If one has a congenial work atmosphere, with good camaraderie with colleagues, one does not feel the pressures of long hours of work. Here, we also carry the responsibility of making our workplaces healthy, productive and better without too much of pressure. India, being a developing country, needs to put in extra hours of work to catch up with the rest of the world. As Swami Vivekananda said, “There is no substitute for hard work.”
However, when we don’t like our work, situation, people or environment, we feel more stressed. More than physical exertion, mental stress kills a person. If we love our work, then we don’t get stressed even by working for long hours and work itself rejuvenates us. Many of us spend more of our awake time at the office than at our homes, and therefore, everything and anything that happens at the workplace does shape our lives or is part of our lives. We should, therefore, be more careful of how we spend time at our workplaces.
Having said that, we must remember that anything in excess is bad. Therefore, we need to achieve a life balance by a proper mix of official work and personal work.
Proposed revision of Standard of Auditing (SA) 600
Another talk of the profession is about the proposed revision of SA 600 by the National Financial Reporting Authority (NFRA). The existing SA 600 on “Using the Work of Another Auditor” essentially deals with guidance on group audits. Its objective is to establish standards in situations where an auditor (referred to herein as the ‘principal auditor’), reporting on the financial information of an entity, uses the work of another auditor (referred to herein as the ‘component auditor’) with respect to the financial information of one or more components included in the financial statements of the entity. “Component” means a division, branch, subsidiary, joint venture, associated enterprise or other entity whose financial information is included in the financial information audited by the principal auditor.
Paragraph 24 of the SA 600 deals with “Division of Responsibility”, whereby it provides that “the principal auditor would not be responsible in respect of the work entrusted to the other auditors, except in circumstances which should have aroused his suspicion about the reliability of the work performed by the other auditors.”
Corresponding to SA 600, the International Standard on Auditing 600 (revised) (ISA 600) addresses issues related to group audits. ISA 600 states that “the group engagement partner remains ultimately responsible, and therefore accountable, for compliance with the requirements of this ISA”.
It may be noted that SA 600 was issued by the ICAI in 1995 and revised in September 2002. The revised version is stated to be generally consistent with the ISA 600 in all material respects but with a significant difference with respect to the degree of responsibility of the Principal Auditor vis-à-vis the Component Auditor. Thus, fundamentally, SA 600 provides for shared responsibility between a principal auditor and component auditors, whereas ISA 600 provides for singular responsibility of the principal auditor for the quality of audit, including the work of component auditors.
NFRA proposed the revision of SA 600 on the lines of ISA 600, primarily with respect to the degree of responsibility and has issued the draft of the proposed SA 600 (Revised) for public consultation and comments by 30th October, 2024. The revisions proposed are to be applied to audits of Public Interest Entities (PIEs)1 except Public Sector Enterprises, Public Sector Banks, Public Sector Insurance Entities and their respective branches.
1 Only those PIEs which fall under Rule 3 of NFRA Rules 2018
As per newspaper reports, the ICAI has raised concerns and requested to put the proposal on hold2. ICAI has a detailed procedure to set or revise any auditing standard, and therefore its opinion does matter. We hope that NFRA will address various concerns raised by the ICAI, and both will work in tandem to improve the quality of audit.
2 The Economic Times, dated 20th September, 2024
The consultation paper on the proposed SA 600 (Revised) by NFRA gives detailed reasoning of the necessity for change and explanations to some of the apprehensions pertaining to the concentration of audits, impact on small and medium accounting and auditing firms, etc. Readers are well advised to go through this paper and give their valuable suggestions to NFRA / ICAI on the proposed revision.
One thing is certain: auditing, per se, has become sophisticated and demanding, and the proposed change will cast a huge responsibility on the Principal Auditor, who needs to be well-equipped to handle such risks. Component auditors can also benefit by adopting best practices and by participating actively from the planning to closing of audits of the entire group.
A day is not far when the Principal Auditor and Component Auditors may require additional qualifications to do audits of large groups, as is prevalent in some countries. ICAI can play a pivotal role in training and upgrading the skills of its members who wish to do audits of large groups / conglomerates.
Well, to sum up on the work–life balance, we need to put more life in our work than work in our life. Take regular breaks and vacations, find out our de-stress buttons and press them often to relax and rejuvenate.
Let the upcoming Deepawali fill your life with brightness and joy.
