The Ethical Standards Board of ICAI has given answers to some of the ethical issues raised by our members. These are published on pages 1634- 1636 of CA Journal for May, 2012. Some of these issues are as under.
(i) Issue: Whether a member in practice is permitted to undertake the management of NRI funds? A member is not permitted to undertake such assignment because the same is not covered under ‘Management Consultancy and other Services’ permitted to be rendered by the practising members of the Institute.
(ii) Issue: Can a Chartered Accountant provide ‘Portfolio Management Services’ (PMS) as part of CA practice? Explanation to Clause (xix) of the definition of ‘Management Consultancy and other Services’ expressly bars the activities of broking, underwriting and Portfolio Management.
(iii) Issue: Whether a Chartered Accountant in practice is required to obtain any trade licence for practising? A Chartered Accountant in practice is not required to obtain any trade licence for practising as a professional. The certificate of practice issued by the Institute is the only requirement to practise as a Chartered Accountant.
(iv) Issue: Can a Chartered Accountant in practice work as a ‘Collection Agent/Recovery Agent’? A Chartered Accountant in practice cannot work as a Collection Agent. However, he can act as a Recovery Consultant as provided in clause (xxv) of the definition of ‘Management Consultancy and other Services’.
(v) Issue: Whether a practising Chartered Accountant can agree to select and recruit personnel, conduct training programmes and P. N. Shah H. N. Motiwalla Chartered Accountants icai and its members work studies for and on behalf of a client? The expression ‘Management Consultancy and other Services’ defined by the Council includes both personnel recruitment and selection and conducting training programmes and workstudies. Therefore, a Chartered Accountant in practice shall not commit any professional misconduct by rendering such services for and on behalf of the client.
(vi) Issue: Can a member in practice have a branch office/additional office/temporary office?
A member can have a branch office. In terms of section 27 of the Act, if a Chartered Accountant in practice or a firm of Chartered Accountants has more than one office in India, each one of such offices should be in the separate charge of a member of the Institute. Failure on the part of a member or a firm to have a member in charge of its branch and a separate member, in case of each of the branches, where there is more than one, would constitute professional misconduct. However, exemption has been given to members practising in hilly areas, subject to certain conditions.
It is to be noted that the requirement of section 27 with regard to a member being in charge of an office of a Chartered Accountant in practice or a firm of such Chartered Accountants shall be satisfied only if the member is actively associated with such office. Such association shall be deemed to exist if the member resides in the place where the office is situated for a period of not less than 182 days in a year, or if he attends the said office for a period of not less than 182 days in a year, or in such other circumstances as, in the opinion of the Executive Committee, establish such active association. It is necessary to mention that the Chartered Accountant in charge of the branch of another firm should be associated with him or with the firm either as a partner or as a paid assistant. If he is a paid assistant, he must be in whole-time employment with him. However, a member can be in charge of two offices if they are located in one and the same accommodation.
