ETHICS AND U

Arjun (A) — Hey Shrikrishna, all these years I believed that YOU make sure that there is rule of justice in the world! But…….

Shrikrishna (S) — Yes, Arjun. ‘But’ what?

A —    Now, I have grave doubts about it! You had said everybody gets the fruits of his deeds – his karmas.

S —    Yes. That’s right.

A —    And you also said that a person is himself responsible for his own progress or downfall.

S —    Correct.

A —    And further; I also remember you saying – a person is his own friend and his own foe! Right?

S —    Absolutely! Hundred per cent marks to your memory!

A —    But then, I find that our CA friends are suffering due to misdeeds of others.

S —    Why? What happened?

A —    See, my friend is practicing for the past 20 years. Totally unblemished track record!

S —    This is a bold statement. It only means that his lapses have not been exposed so far!

A —    Whatever you may say. But so far he never had any problem.

S —    Good.

A —    He signed one company’s audit for one year in good faith.

S —    What do you mean by good faith? One should never certify any accounts merely on faith; unless one verifies it.

A —    Actually, his friend said, he has exhausted the limit of number of companies that one can audit. He said, this was a group company and he had seen everything.

S —    Oh!

A —    Now, the directors of that company misused his signature. No doubt, he signed for one year; but directors uploaded the balance sheets of 3 or 4 subsequent years to ROC as if my friend had signed them.

S —    Strange!

A — And later on it was revealed that the management was totally fraudulent. They had formed many companies, got them listed on stock exchanges and did a lot of financial irregularities. All documents were fabricated!

S —    So, what happened to your friend?

A — Somebody made a complaint to our Institute saying that he relied on these balance sheets and was duped!

S —    Naturally. Anybody would do that if he has suffered.

A —    No. The funny part is that the complainant also turned out to be a fraudulent person. Both the complainant as well as the chairman of the company were behind bars!

S —    Good. I told you that everybody gets the fruits of his karma. Each one of them became the enemy of himself. So, what I told you in Mahabharata was true!

A —    Yes.  But why should my friend suffer? He was unnecessarily dragged into the disciplinary case. He did not even receive his fees!

S —    How do you say ‘unnecessarily’?

A —    Of course! Both the parties were criminal. How is auditor answerable? What is his mistake?

S —    Arjun, just think for a while. Is it not a fact that he signed the audit papers?

A —    Yes. But only for one year.

S —    OK. But for that year, had he checked the books and records properly?

A —    But it was fraud!

S —    So what? Did he write to the previous auditor? Did he check up validity of his appointment? Did he upload necessary forms like form ADT 1 to ROC? Did he obtain management representation letter? Clause 7 of Second Schedule clearly covers both – gross negligence and lack of due diligence.

A —    No.

S —    Then! See my dear, God helps the diligent.

A — That means he was duped by his friend. I believe, that friend is also facing complaints.

S —  I told you many times. Your Council is concerned with your conduct; not anybody else’s. Have you acted diligently as a professional? What prevented you from refusing to sign?

A —  Temptation! And also the faith in the friend!

S —   That is very common among all professionals. Rather, it is human instinct.

A — Actually, the management promised to help him in the proceedings. They said they would take care. But now they backed out. They are themselves in difficulty! It had come in the press also.

S —    That’s what I am saying. Your friend may not be involved in the fraud. But did he inform police about forgery or all these happenings?

A —    He was so afraid! He said both the parties are criminal.

S —    Whatever it is. But he has to face the music. It will be better if he pleads guilty. At least, his case may be considered sympathetically. Confession often helps.

A —    Can he be absolved?

S —    Difficult. He may be held guilty of misconduct; but punishment may be soft if he comes out clean.

A —  Yes, Lord! I take back my words. This is a good lesson to all of us. We cannot claim to be totally innocent. It is a breach of duty as a CA. There is no point blaming others.

S —    So then, I am sure, you will take care.

A —    Yes Lord! Please protect me.

S —    Tathastu.

Om Shanti.

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