Year: 2026

These questions accompany seven articles in this Annual Issue of BCAJ on the Globalisation of Indian Accounting Firms. They are intended to provoke honest reflection, serve as a mirror, and surface gaps that domestic incumbency may be concealing. We hope that the user will answer them with evidence rather than intention — and that the distance between the two will tell you something useful.

HOW TO USE THIS QUESTIONNAIRE

•  Work through every section with your full partnership leadership team.
• Answer with evidence, not aspiration. Where you cannot point to a concrete fact, name, decision, or number — record it as a gap.
• Each question leads to an action. Use the right-hand column to commit to a specific action, owner, and date.
• Rate each section GREEN (answered with evidence) / AMBER (answered aspirationally) / RED (cannot answer honestly) in the Readiness Summary at the end.
• Answer the Diagnostic Question last. It is the single most important question in this document.

After completing all nine sections, classify each section into one of three categories:

BCAJ Admin

Indian accounting firms struggle to compete with global giants due to deep fragmentation and lack of scale. To survive and grow, they must learn from the Big Four by prioritizing institutionalization over individual ownership, investing heavily in technology and AI, and developing deep industry and domain specializations. Furthermore, Indian practices need robust governance, talent management, and quality control systems. However, instead of mimicking the rigid silos of global networks, Indian firms can carve a competitive edge by offering highly integrated, personalized services and dedicated relationship management, particularly to mid-sized clients.

INTRODUCTION

The Indian accounting sector is highly fragmented, with over 72% of 1,00,000+ firms operating as sole proprietorships. With only 13 firms having more than 50 partners, these small firms lack the scale to invest in technology and talent and thus lose significant market share to large global giants.

GLOBAL FIRMS – A PERSPECTIVE

This article is about learning from global firms, and whilst there are many global firms other than the Big Four (such as BDO and Grant Thornton), for the purpose of this article, some statistics regarding the Big Four have been highlighted just as a reference point, especially to understand the difference in scale, and to keep in mind the big picture.

The global revenue and employment generation of the Big Four firms for the year 2025 is given in the table below.

Each of these “firms” (actually networks) have been built, on an average, over a hundred years and it is important to recognize that these are not firms which are, so to speak, majority owned by a handful of people; they are not. First of all, in most countries, the individual firms are part of a network and it is not that one country “owns” the entities in the other countries. It is often wrongly thought that USA would own, say, the Indian counterpart; local firms are owned by local partners, and the branding is the result of, say to speak, a franchise. There are, of course, some exceptions, such as that the US firm may have a joint venture with the Indian firm for some parts of the business, such as a back office or a global capability center, but that is not the same as saying that there is a holding company which owns all other entities. Also, this is not the same as consulting firms like, say, McKinsey or BCG or Accenture, where it is not a confederation or a network, but like a multinational MNC; it is very important to bear this distinction in mind to understand how these firms function and what could be the learnings therefrom.

BIG FOUR IN INDIA

The Big Four in India are a minuscule part of the global operations, although obviously, India being the fifth largest economy in the world, it is very important to these firms. One of the reasons for this importance is not the revenue, but a gap in the ability to service MNCs across the world is a major issue; also, India often also has back office capabilities which are often leveraged by larger global firms, either as joint ventures or otherwise.

The 2025 March India revenues and employees of the Big 4 was estimated as under:

SOME CHARACTERISTICS OF GLOBAL FIRMS

The single biggest characteristic of Global firms is institutionalization; as mentioned above, these are not individual partner owned and even the chairman of the firm at the global level (he is chairman of a network as such), or let’s say the chairman of an Indian Big Four firm does not “own” the firm, and therefore is not the “promoter/founder”. Majority of the people at the Chairman/CEO level (and there are some exceptions), are usually there for 8 to 10 years, and, in a sense, it’s like a rotating position; in a sense, this is like being the first amongst equals.

There are several other characteristics of a big global firm that are important to understand for aspiring large Indian firms in terms of learnings and aspirations and also what to avoid; some of these are elaborated below:

1. Big global firms have significant specialization, both domain and industry. In a sense, it’s a matrix organization; usually, the Global firms are divided into three broad service lines:

– Audit (or what is called “assurance”)

– Advisory/consulting

– Tax and regulatory services

Very often, internal audit is a part of the advisory practice and not the assurance practice.

2. The advisory practice has a large number of specializations in terms of domain, such as the following:

– Technology consulting, which is usually the biggest

– Cyber consulting

– Financial advisory

– HR/people consulting

– Strategy consulting

– Operations consulting

– Government advisory practice

The above list is not exhaustive and indeed may differ somewhat across firms, but it would possibly be substantially representative of most of them. It is important to understand that even within the above, there are several subdivisions; so for example, in financial advisory services, one would have corporate finance/investment banking, due diligence and valuations, each of which is a significant size practice in its own right.

The key thing is that there is a very vast range of services with significant specialization, which gives Global firms tremendous muscle power, in the sense that it gives it the ability to service clients across a spectrum of needs. Of course, it also has the disadvantage of being too “siloed” in some sense, which is a drawback that Indian firms can leverage on.

Another characteristic of a Big Four is industry specialization; for example, financial services in most Big Four firms as a part of the tax and regulatory practice is a separate SBU. So while direct tax, indirect tax, transfer pricing, expatriate taxation and transaction tax could be separate SBUs, none of which is industry specialized, very often, financial services is a separate specialization because it has its own peculiarities. Indeed, even within that, there are sub segments such as asset management, FIIs, private equity and others, recognizing the completely different nature of the respective animals. Obviously, that means that the professionals who work in these are specially trained for that purpose and obviously develop that knowledge over a period. Indeed, even within the assurance/audit practice, partners are often identified based on domain specialization, such as financial services, power sector, FMCG, pharma, etc., and that is one of the considerations that clients often use in deciding which firm to use even for audit.

WHAT ONE CAN LEARN FROM GLOBAL FIRMS

There are three pillars to a professional services firm: clients, people, and infrastructure. However, if one thinks deeply, it is essentially people, people, and people because with the right talent, the clients will come and the infrastructure will be built. Of course, this in one sense is an oversimplification, but it is important to bear in mind that global firms lay a lot of emphasis on people.

There are a variety of dimensions that one can learn from global firms and some of these are as follows.

– Institutionalisation is a critical aspect and institutionalise comes with size and also the other way around i.e. once you grow in size, you require the firm to be institutionalised; in simple terms, it means that the ownership mentality has to give way and if the founder or the owner has, let’s say, 60% equity and 20 or 30 other partners have 40% equity, it’s a model which will at some point face a challenge, although there are a large number of firms, (including law firms), which do have this model. However, if the talent is really top class, at some point, this model will face challenges; accordingly, a model needs to be thought upfront, or at least may need to be evolved once the firm acquires a critical mass as to what is the model in terms of institutionalisation versus non-institutionalisation. In the latter situation, there are likely to be challenges to growth and also to the attraction and retention of top talent. Of course, if it is a small boutique firm, the non-institutionalised model can work well.

– Governance is another major dimension, and it becomes complex because most global firms (and especially the Big Four) are networks and as such, not one unified firm. As such, the global governance involves a global Chairman who represents the network and the network entity which is not a service entity lays down standards, brand rules, independence rules, risk issues, etc, the enforcement being through membership service agreements. It’s important to recognize that each service line will also have a global service leader, such as an assurance global leader, a tax global leader, and an advisory global leader; the respective local entity service leaders do not report to them directly, but may have something like a dotted line relationship, but there is no direct enforceability by the network except through the membership agreements. This obviously creates its own complexities and tensions, which is unavoidable, given the overarching architecture . Most of the individual firms have an executive committee or an India leadership team, and there is usually also a “partner oversight committee” (or some similar body) which deals with partner related issues. It’s overall a very complex ecosystem which emerges out of the need for significant institutionalization and the checks and balances.

– Quality standards and reviews is again a major issue and it partly emerges out of what is stated in the point above; as such, there are quality control reviews and of course, this becomes even more important in the assurance practice, which gets further complicated by regulatory issues such as PCOAB and NAFRA; most network firms, in any case, have their own quality departments not only for the assurance practice, but even for other service lines such as tax and advisory. In relation to tax, for example, there are reviews in relation to the quality of communication, technical positions, etc.

– Independence and conflict of interest management are also extremely important; as such, client acceptance is usually a long and sometimes painful process because it requires checks by an independence team. There is also often a conflict between different service lines, including on client ownership and, in relation to assurance clients, this becomes even more complex and of course has also significant regulatory constraints. The assurance practice has obviously got much more stringent independence requirements but even otherwise, overall, the independence and conflict of interest ecosystem is very elaborate and quite complex.

– Partner compensation is often a very sensitive topic and while the general principle is “eat what you kill” and it’s like a modified lockstep, this issue is always sensitive; some firms have a “grid”, and others have points, but the bottom line is that it is usually a combination of firm performance, service line performance, responsibilities assumed and individual performance. It is overseen by the executive committee and leadership team at an overall level, but in certain cases by specific remuneration committees somewhat on the lines of an NRC of a limited company. Very often, the issue of management responsibility vis a vis the delivery responsibility and the compensation becomes a complex issue and has inbuilt tensions.

– Global firms normally have robust structures and with structures, there is specialization. If one sees also from the perspective of knowledge/content, for a professional to say that “I do audit and I do tax and I do internal audit and I do cybersecurity”, does not sound credible, and in these days of deep knowledge and specialization, it will definitely not give comfort to a client. In other words, while some people at the top may be able to do work across different domains, more operating teams will need to have specialization. Obviously that means one needs structures; in practical terms, this means clearly defined service lines and SBUs within service lines; for example, even in a 50-people tax firm, one could have a Direct tax SBU, Indirect tax SBU and a transfer pricing SBU, each with, say, 15 to 20 people, so that the client gets comfort of specialisation.

– As mentioned elsewhere in this article above, industry specialisation is becoming crucial. In some sense, it could be a matrix of domain + industry. Usually, the industries where one may need to specialize is financial services, infrastructure, real estate, and, of course, the larger the firm, the larger the number of industries in which one could specialize. This industry specialization, along with domain specialization, is often seen as a critical differentiator of global firms; for example, if one is doing work for a NBFC, then a direct tax professional, an indirect tax professional, and a transfer pricing professional all of whom are specializing in financial services would create a better impact on the NBFC client than generalists who may not understand the special aspects involved in an NBFC.

– One other aspect of global firms is the quality of presentation and packaging; there is a lot of stress on communication, both oral and written, and there are detailed guidelines on fonts, formatting, presentation formats, etc. It would be helpful for Indian firms to also create certain templates so that there is a standardization; also, it’s important to have focus on oral communications and softer skills, so that the overall “packaging” is professional and creates a good impression. This is particularly relevant in situations where there is interaction with the C-suite.

– Linked with the issue of quality, as also with the issue of packaging, is the ability of big global firms to charge larger fees. Of course, their costs are also higher, but the combined effect of quality, domain specialization, industry specialization, and packaging is integrated into the ability to charge larger fees. Without getting over-commercial, it is important to recognize that earning good fees will also enable people to be paid well, and this creates a vicious cycle of talent and quality, which Indian firms could do well to emulate to the extent possible.

– Coming again to talent, there is a huge amount of training that would need to go in; this could be a combination of seminars, in-house trainings, international trainings, etc. This updation is critical because at the end of the day, one is in a knowledge profession and knowledge updation is a crucial dimension. Large global firms have significant budgets in this regard and it may be worth considering for Indian firms, (at least those who are 50 to 75 people or more), to actually have a formal budget for this aspect (equivalent of an R&D budget for manufacturing companies).

– As an elaboration of the above, Knowledge access is a critical part of large firms; some of them have knowledge centers or a Knowledge and solutions team, technical teams for audit, etc. Given that developments in regulations, specific industry related developments and judicial precedents are all making it a huge challenge to keep up to date, it is very important for Indian firms to have a knowledge updation architecture, and unless that engine fires and fires effectively, on an ongoing basis, the ability to make a difference qua clients will be impacted.

– Big global firms often tend to come up with publications on a variety of aspects; as an example, this could encompass developments on Ind AS/NFRA (both of which are very relevant for assurance practice) or changes in tax laws or changes in SEBI or RBI regulations, developments on Artificial Intelligence, Cyber Security related etc. These publications are usually significantly researched and very well presented. Indian firms may first of all not be engaged in many of these areas, but in relation to services they are engaged in, it would be a
good idea to think of periodical publications where there is some trigger; for example, Income Tax Act coming into force or a monthly newsletter would demonstrate pro-active capability and helps to build branding also.

– We are in a world where technology is becoming crucial and investment in technology is very crucial. Now, of course, there is a new dimension of technology which is artificial intelligence and hence, training in AI is becoming crucial and, of course, subscribing to AI tools like ChatGPT and Claude across the firm would be crucial because there is obviously going to increase productivity and quality, including in knowledge and drafting.

– Large global firms tend to have robust evaluation processes and HR practices and that is another aspect that Indian firms need to invest in. This obviously means that one may need to recruit an HR head, once the firm acquires a critical mass; HR is a very specialised function and the ability to have a proper professional people focus will come with an organized HR department headed by an HR professional. This obviously would include evaluations, trainings, surveys, proper recruitment processes, exit interviews, etc. This focus on talent is an extremely crucial learning from large firms.

One of the key items of focus for a big four firm or for a global firm is risk management. This manifests itself in various forms beginning from client acceptance to quality control checks and in many other ways. In audit/assurance practice, of course, the level of rigor is extremely high given the oversight also by NFRA as well as extreme focus by boards, proxy advisory firms, analysts and the press; this focus on risk management is an important learning for Indian firms although, of course, constraints of size both of the firm and of the clients, and often the inefficiency built into large firms, can be appropriately cut down in what would obviously be relatively small Indian firms, but the concept of risk management is extremely crucial to acknowledge and put into practice.

While the above and many more could be the learnings from large firms, it is important to recognize that the sheer scale and size of the big firms, the depth of the talent, the geographical spread and indeed, quite often, the compensation levels, is a significant issue in relation to the ability to compare. The compensation part is often a serious constraint in attracting talent, where the ground reality is that the growth of the Indian economy has led to quite a few average people being promoted to senior levels in global firms, at least in India; what is actually happening is that the “banding” concept in global firms is leading to people being in bands and being promoted. This is not to say that high quality talent does not exist in large firms in India; it does, but the practical reality which one has seen from experience is that very often the top 15% or 20% take completely disproportionate load, and very often average professionals tend to get overcompensated and this becomes a huge constraint for Indian firms to attract talent.

THE BRANDING IMPERATIVE … AND RELATIONSHIPS

Branding is another significant advantage that the large firms have and whilst one there are often risks associated with branding in the sense that something going wrong, it can seriously damage the brand, as a broad concept, the brand is a major attraction for clients because larger clients (and decision makers within those clients) usually want the “shelter” of going with a brand name, rather than sticking their neck out for relatively unbranded names. As such, global firms often tend to have the “pull factor” of a brand and a network, whereas an Indian firm may not have that brand or at least, not a level anywhere comparable to global firms, and therefore, the ability to build relationships and connects is crucial for Indian firms.

One of the issues that Indian firms face is that they rely primarily on individual contacts, and that is, of course, important, but global firms, including the Indian counterparts of these large firms, have a significant institutional connect more so with MNCs, but increasingly, also with large Indian corporates. The important thing to recognize is that when one is dealing with large clients, the size of the firm which deals with large clients becomes important, and in a sense, as one senior professional one put it, the institutional connect like “a building talking to a building, as opposed to the normal model in India of a person talking to a person”. As seen, both are important i.e. individual relations are extremely important, but institutional branding and networking is very crucial and a large advantage for global firms.

In this context, one has to recognize that the ICAI regulations have also lagged behind contemporary reality, and the ethical framework rooted in Clause 6 of Part 1 of the first schedule to the Chartered Accountants Act has traditionally been very restrictive. However, the professional services landscape has evolved significantly, and recognizing this, important revisions to the ethical framework has been announced with effect from 1st April 2026, signalling a glide path to what may be described as enabling professional visibility, at least to some extent. While one need not get into details in this article, (and much of this has been brought out in a very useful article in the BCA Journal of April 2026), suffice it to say that Indian firms can do a lot more in terms of institutional branding; here are some examples.

– A strong, robust and updated website

– Writing articles in professional/business journals/newspapers.

– A good social media presence, particularly on LinkedIn.

– Hosting webinars and/or podcasts.

– Holding roundtables for clients (this can be extremely effective if targeted properly; for example, separately for independent directors, separately for CFOs, separately for some specific industry, etc).

– Sponsoring some events.

Obviously, larger Indian firms can do this on a meaningful scale, but mid-size firms can also do this, although at a much smaller scale. One of the issues that will arise is funding, but that’s a “chicken or the egg” situation and that is indeed also one of the reasons why Indian firms are now looking at collaborating or merging, which obviously means that the mind set will have to change in terms of big a fish (maybe a big one) in a pond, as opposed to being the pond itself.

WHAT ASPIRING INDIAN FIRMS COULD DO ….. AND AVOID

Having discussed quite a few aspects of big firms and the constraints of relatively much smaller Indian firms, there are aspects of big global firms which Indian firms can avoid, and, in fact, do the converse in some sense. This is very important keeping in mind that the client landscape can also be segmented and different clients have different needs and also have need for different approaches.

Before one gets into that, as a broad concept, one of the temptations that Indian firms must avoid is getting into all kinds of work and accepting clients without understanding risks or cultural fit. Of course, in the last decade or so, both from a regulatory standpoint, the ability to raise funds and the market cap imperative, the overall quality of governance has gone up significantly and yet, Indian firms would do well to be careful and accepting clients only where the cultural fit is good and the governance levels are high.

One important dimension that has to be recognized is that a professional practice will need to architecture its path. Is it to be a full service firm, in which case size will become critical, or will it be a boutique firm? For example, a boutique firm which does only audit or only internal audit or only specialized tax work or only litigation. In fact, there could be many other examples, such as doing only structuring work, or only forensic work or only back office work. One important question to ask, in order to go down the niche path, “is there a niche in the market” and more importantly, “is there a market in the niche”? If the answer to both is yes, then that could be the model, but it is critical to recognize that if one is going the niche/boutique path, there has to be clearly demonstrated differentiation and skill. It’s like saying that “this is not a multi-cuisine restaurant, it’s a specialized Mexican food restaurant, but our Mexican food is the best”.

Global firms derive significant advantage from cross-border referral networks. Indian firms, especially those aspiring to serve inbound FDI clients or outbound Indian MNCs could seek to become part of formal networks or “best friend” alliances in order to create a larger catchment area in relation to cross border work.

Given that AI is fundamentally reshaping the audit, tax and advisory landscape, Indian firms can learn from the global firms as to how they are embedding AI in audit workflows, the risks of AI-driven commoditization of some services, and how Indian firms can use AI as a leveller against larger firms.

One critical aspect that Indian firms should do even if it is not fully institutionalised is regarding succession planning; that gives both team and clients, greater comfort.

Some further aspects which Indian firms would do well to keep in mind.

– Large firms often tend to work in silos due to the specialization and the structural imperatives Indian firms would also need structures, but have the ability often to provide a more “integrated” face to the clients and that becomes very important; for example, if one is doing tax work, an integrated approach between a direct tax partner, an indirect tax partner and a transfer pricing partner to present a coordinated face to the client is often very important. This does not mean that large firms are not doing it, but the sheer size and structure makes it more difficult for them to do so and that is where Indian firms can do better.

– In a Big Four, relationships are usually is normally institutional and that becomes sometimes a put-off for mid-sized companies, especially those which are promoter driven; what Indian firms can do is to have a more personalized, less commercial approach.

– Big firms will obviously have a large number of service lines and significant geographical spread; Indian firms may not be able to match up to this and should therefore avoid the temptation to spread too thin, both in terms of number of services as well as geography, but try and focus on quality and personalized service as their USP.

– Big firms have several internal constraints in partners accepting Board memberships (usually not permitted at all), whereas in Indian firms, that constraint may not be there; while one has to be careful in getting onto boards given the risks involved, it is worth considering joining high-quality boards because it leads to a lot of learning, creates stature and also enables creating a business and professional network that can be of benefit to the firm.

– Becoming a member of committees of professional organizations (and preferably business chambers of commerce) is often very helpful and Indian firms should have a framework to enable their partners to do so.

– Big firms normally have relationship partners for large accounts and that becomes a very important aspect for the clients; however, the relationship partner concept is usually for very large clients and the definition of what is “large” will obviously be very different from Indian firms and therefore, Indian firms which service mid-sized clients that can provide them with a relationship partner, especially where the firm is rendering different kinds of services, would be an important attraction for such clients as opposed to going for a global firm.

CONCLUSION

There is a lot to learn from global firms and Indian firms have a long way to go in that respect. Some key issues are that institutionalisation is a very important aspect of growth and talent retention. Also, that size does matter because investing in people, investing in technology, investing in knowledge is very difficult for a firm of smaller sizes. Also, alternatively of course, one can go the niche path, but then very specialized knowledge and clear differentiation is necessary.

As such, adapting the learning of big global firms to an Indian context, particularly in terms of structure, knowledge, updation, technology and focus on talent will enable Indian firms to get to the next level and reinvent themselves; it is however, important to bear in mind that the need to reinvent is not a one-time exercise, but needs to be revisited every few years in an incredibly fast changing world.

However, as mentioned above, there are a large number of things that large Indian firms that Indian firms can do in terms of personalized service, relationship building, providing work-life balance, and indeed, within the constraints of the size of the firm, also create visibility. At the end of the day, however, content and technical skill is also extremely important, and providing that content with personalised relationship and an integrated approach are very important dimensions where Indian firms can do better, particularly with mid-sized clients, and sometimes even with large ones.

BCAJ Admin

As Indian businesses globalise, Indian accounting firms must evolve from founder-centric, domestic practices into scalable global institutions. This transformation demands significant capital investment in enterprise technology, brand building, and top-tier talent, which traditional partnership economics can no longer sustain. Consequently, Private Equity (PE) is increasingly financing professional service firms, drawn by their high client stickiness and predictable revenues. However, attracting private capital requires adopting alternative practice structures to maintain strict statutory audit independence. Ultimately, firms seeking PE funding must professionalize governance, establish strong second-line leadership, and rigorously balance aggressive growth targets with uncompromising professional integrity.

Financing global growth is very critical for accounting firms — and, for that matter, for all types of professional service firms that are looking to grow. When it comes to capital requirements, private equity, and business economics, there are a few things I think are worth saying plainly, from the vantage point of someone who has lived this transition from the inside.

For decades, Indian accounting firms operated within a stable and predictable professional ecosystem. Growth was relationship-led, partner-driven, and largely domestic in orientation. Capital requirements were modest. Expansion was linear. International presence, if any, was through correspondent relationships or selective referrals. That world has fundamentally changed.

Today, Indian accounting firms operate in an environment shaped by cross-border transactions, global regulatory frameworks, multinational clients, digital delivery models, private capital flows, and rising client expectations around quality, responsiveness, and scalability. As Indian businesses globalise and international investors deepen their presence in India, professional firms are being compelled to evolve from founder-centric practices into scalable institutions. That transformation requires capital — more capital than traditional partnership firms and their underlying economics can comfortably generate.

I. CAPITAL REQUIREMENTS: WHAT IT ACTUALLY TAKES

Capital requirements fall into two broad categories: expenditure on the firm’s foundational assets, and expenditure on the people and activities that sustain and grow it. Both demand explicit planning and committed allocation. Neither can be treated as discretionary.

A. TECHNOLOGY

Every accounting firm today has to think about a reasonable but fair allocation to technology — and must do so without inhibition. Technology here means technology infrastructure, software, tools for automation, custom development tools, and specific aspects of AI that will help execute faster and in a much more efficient way than today.

What this means in practice is that firms need dedicated IT teams, or outsourced vendors, who can provide an honest estimate of technology spend on an annual basis. The subscription stack alone is longer than most managing partners appreciate: Microsoft 365 or equivalent, AI tools, audit tools, practice management platforms, HRMS, performance evaluation tools, timesheet and attendance systems, high-quality accounting and ERP software, CRM — each carrying annual licence costs that compound with headcount growth.

Firms need to provide for technology and technology-related spend constantly and without inhibition. For a typical mid-sized firm with INR revenues of around ₹50 crore, I would expect technology spend to be anywhere between 5 and 10% annually — so up to ₹5 crore per year. I would ideally like to go more, but I am careful about the relative size of the firm: a ₹50 crore practice would mean anywhere between 100 and 200 people, and all of them are using infrastructure, laptops, and service tools every day. All of that needs technology spend. None of it is optional. The example of ₹50 crores is merely an illustration — the 5 to 10% spend can be higher or lower depending on what is the priority for a particular firm. None of these percentages or numbers are cast in stone, so readers will need to consult their IT specialists and technology firms which specialise in servicing professional services firms, and then budget this aligned to their individual requirements.

B. STRATEGIC INVESTMENTS: BRAND BUILDING

All views expressed in this section must be read in conjunction with the specific rules and advertising guidelines of the Institute of Chartered Accountants of India (ICAI) in respect of brand building, and the nuances thereof. Nothing herein should be construed as suggesting any practice or ideas which fall outside of ICAI’s regulations and ambit.

It is very important that accounting firms think about brand building in a manner that is recognised and appreciated. That means marketing and PR, a thought-through branding strategy, podcasts with well-known personalities and with partners and individual brilliant technical people who disseminate knowledge. For me, branding in a professional services firm is really about knowledge marketing. It is participation in events, conferences, seminars, and workshops. It is knowledge partnerships and sponsorships where the brand becomes visible.

But the most important thing in a professional services firm — especially an accounting firm — when it comes to branding, is clear technical speakers who talk about what is happening in the world of accounting, tax, M&A, valuation, and all the service areas in a consistent, crisp manner that shows expertise. Public speaking in study circles, seminars, workshops, global and national events — that, to my mind, is the finest form of branding one can do. Because when a professional is heard in a public forum of peers, and when those peers accept and respect that professional — there is no substitute to that kind of branding. No marketing budget can replicate it.

For both of the above, it is important that the budget for expenditure on brand building and on events is well thought through and planned in advance, such that capital raise discussions or investor conversations become easier and sharper — given the express and articulated need for funds.

C. OPERATING EXPENDITURE: TALENT

When it comes to operating expenses, the key lever for a professional services firm to grow is talent. It is really the people — good-quality, high-performing individuals — who are not only qualified as Chartered Accountants or Certified Public Accountants, but who have the right experience at every level. A firm can expect to grow positively only and only if the people are growing themselves.

That means real investment in two things: attracting high-quality people, and retaining them. Retention means learning and development programs, motivating people constantly, taking care of what they really need, having off-sites, dinners, and coffee chats — taking interest in their L&D and their growth at an individual level, as opposed to only the group level. A senior employee who is technically brilliant may need some help in soft skills and social skills. Somebody who is a great communicator may not have the best technical skills. Each individual is different in their thought process and in their work approach. The talent that one needs for running a professional service firm must take into account diversity of thought process, diversity of skill sets, and diversity of experience. Therefore, accounting firms must align on the right expenditure to be incurred for the right talent, and this should be very much part of the budgeting process.

D. OPERATING EXPENDITURE: GLOBAL EXPANSION AND COMPLIANCE

Global expansion is really about globalisation. Can a firm in India think about setting up licensed practices in locations like Dubai, Abu Dhabi, Singapore, Japan, Australia, London, and other English-speaking countries? I think it is about licensing, about having a vision, about ensuring that the plans are ambitious enough and have global aspirations — and that the firm can be the firm of choice for the global growth of its clients.

But global expansion comes with compliance obligations that are complex and non-negotiable.

A firm growing internationally has to ensure that all the laws of the overseas country, as well as India, are always fully complied with. There is transfer pricing. There is permanent establishment.There are tax withholding rules. There is documentation for each of these. And therefore, it is very important that a professional services firm — an accounting firm above all — thinks about the full level of compliance before thinking about growth. In this profession, a compliance failure overseas should be best avoided.

II. REVENUE ECONOMICS: SCALABILITY, MARGIN PROFILES, AND CROSS-BORDER PRICING

For an accounting firm, revenue has to sustainably grow at 15 to 20% year on year. Some service lines will grow faster — 25 to 30%. For high-growth firms, even 25 to 30% aggregate growth is not unachievable and is very much within the range of what disciplined firms have demonstrated.

For that to happen, the firm has to have a strong vision of scalability. It needs to invest in partners, directors, senior managers, and managers — and invest in their growth. It needs to identify the next-generation leaders from within the ecosystem of interns, associates, and assistant managers who are becoming managers, then directors, then partners. And for that, the firm has to have a high-quality culture of performance — which means merit-based promotions, not just general year-end conversations. High-quality processes, practice management, and policies that encourage and inspire growth, such that the firm scales both organically and inorganically. It is also important to cap the growth aspirations with a reasonable degree of focus. One cannot be generating revenues without direction — growth that is stunted or scattered is not what investors or the partnership expects. Focus on key core domain areas. In those focused areas, scalable growth at reasonable margins is possible and sustainable.

Investors evaluating revenue forecasts want to see achievable numbers — a trend that clearly demonstrates the firm’s growth trajectory without overpromising. Revenue projections, growth assumptions, and the partnership’s collective thinking on scale must be in alignment. When in doubt, err on the side of being conservative; a forecast that is met or exceeded builds far more investor confidence than one that is missed.

MARGIN PROFILES AND CHARGE-OUT RATE ARCHITECTURE

When we are talking about growth and global growth, one of the most important aspects that private equity investors — and investors in general — look at is the firm’s ability to scale at good margins. There is no value in revenue increase with losses or sustained cash burn. Scale has to happen at decent margin profiles.

From what I am seeing currently and basis my experience, typical charge-out rates for senior partners in India across mid-sized firms with specific expertise in say Tax or Valuation or Advisory would be between USD 500 and 800 per hour. For mid-level and junior partners, USD 300 to 500. For directors, USD 200 to 400. For senior managers, USD 150 to 300. For anybody below senior manager level, up to USD 150. These are the benchmarks of a firm that is competitive at an international level, and they should serve as directional targets even for firms that are earlier in the journey. Again these are perhaps averages and there will always be exceptions to these for a few firms.

Whilst the above is the way to think about high-quality margin profiles and charge-out rates, this is again not cast in stone. Individual firms may have higher charge-out rates or a different value-based pricing methodology, and there could be smaller or mid-sized firms charging lower. It all depends on the market being served, the customer value proposition being offered, and the way a particular firm — its partners and its services — is perceived in the market. The above is guidance, and one of several ways to think about this. It is by no means the only way to think.

CROSS-BORDER PRICING: A CALIBRATED APPROACH

When it comes to cross-border engagements, pricing must be well thought through at cross-border rates. Cross-border rates will carry a premium over Indian rates — but how much depends entirely on what type of work is being done. For high-end work — high-end tax advisory, complex M&A structuring, specialised assurance — one can even go to two, three, or four times Indian rates. For routine work — accounting, auditing, routine compliance taxation — one must be cognizant and not overcharge.

Cross-border pricing must therefore be approached thoughtfully and within a defined range: 10 to 15% for routine services, going to 30, 40, or 50% depending on the actual complexity and value of the work being done, and up to 2 to 4 times for genuinely high-end advisory. Price to the value delivered, not to the location of delivery.

III. PRIVATE EQUITY TRENDS IN ACCOUNTING FIRMS

Private equity is, of course, one of several financing levers available to a professional services firm, and it is worth briefly placing it in that context before going further. Firms across the globe have long used, and continue to use, discounting of outstanding receivables to manage working capital, lease financing for office infrastructure and equipment, and working capital facilities from banks for shorter-term needs. These tools remain valid and, for many firms, sufficient. What has changed is that for firms with genuinely global ambitions — multi-country expansion, large technology investment, and scaled talent acquisition — these traditional levers are often not enough on their own, and that is where private equity has entered the conversation.

Over the last five to six years, specifically in the United States, we have seen high and increasing interest from private equity in financing — through equity capital, convertible debt, and sometimes straight debt — of professional services firms, and especially accounting firms. This is not speculation. The transactions are on the record, and they tell a very clear story.

Table 1: Major PE Investments in Global Accounting Firms (2021–2025)

Sources: Journal of Accountancy, Accounting Today, Financial Times, CFO Brew, Transacted (2024–25)

Limitation: Data shared to the extent publicly available from reliable sources.

Five of the top 26 US accounting firms received private equity backing in less than three years. Three of the top four fastest-growing US accounting firms — EisnerAmper, Citrin Cooperman, and Cherry Bekaert — were PE-backed, with year-on-year topline growth of between 38 and 100%, against an industry average of 18%. And in 2025, Citrin Cooperman completed the first-ever PE-to-PE transfer in the profession, with Blackstone acquiring the stake from New Mountain Capital. This flip is validation of why PEs got interested in the first place.

Private equity looks at accounting firms as businesses with annuity growth backed by strong partners, strong clients, and very high client stickiness. In an accounting firm, growth is directly proportionate to and corresponds with how the professional services firm has built its client base over years. Accountants by nature do not splurge. They do not spend too much money, which means most of the profits are retained in the business. Partners withdraw money as and when there is cash, but that is limited to their needs. The balance is typically reinvested. That frugality, i.e. a natural tendency toward cash accumulation, is a green tick in private equity investments. These are businesses that can effectively declare a dividend every month or every quarter, and do so reliably.

Even in an AI-driven environment and across all market climates — whether markets are up or down — accounting firms continue to play an essential role. Their value is increasingly recognised when greater assurance is required on the quality of earnings and the quality of numbers. When tax laws change and tax becomes complex, good accounting firms are needed. An M&A transaction or a funding transaction cannot happen without accounting firms conducting due diligence exercises, their audits, their M&A tax structuring. Private equity understands this well.

THE INDIA PICTURE: A MARKET AT THE BEGINNING OF ITS PE JOURNEY

India is at an early but accelerating stage of the same transition. The transactions completed so far are small by global standards, but highly significant as signals of direction.

NAVIGATING THE REGULATORY FRAMEWORK

This Indian picture must be read against the regulatory framework that governs it. ICAI does not, at present, permit external or private equity capital to be infused directly into a firm holding audit practice. Some of the transactions referenced above have been structured using an Alternate Practice Structure model (“APS”) in international firms that house the advisory, valuation, tax, and other non-audit lines of business, kept entirely separate from the audit practice, which continues to be owned and controlled exclusively by its partners in the manner the local regulations require. This is not a workaround; it is the operative model for any firm seeking external capital today, and it has direct implications for how a firm structures itself, its governance, and its independence safeguards. The AICPA has provided guidance on APS which then has been adopted by various regulators worldwide. ICAI regulated firms need to tread cautiously and seek appropriate advice before proceeding on these lines.

Table 2: PE and Institutional Investments in Indian Professional Services Firms (2022–2026)

Sources: Accounting Today, Uniqus Consultech, Economic Times, Tracxn, The Finance Story, Ryan LLC / Dhruva Advisors press release, BusinessWire (2024–26).

Limitation: Data shared to the extent publicly available from reliable sources.

The Indian accounting services market was valued at approximately USD 28.38 billion in 2025 and is expected to reach USD 65.63 billion by 2033, according to IMARC Group. PE capital will follow that growth. (Source: https://www.imarcgroup.com/india-accounting-services-market)

If a firm is generating 25% or more revenue growth over the last three to five years, and generating EBIT of 20 to 25%, that is a very strong green tick mark for any private equity investor. Capital will not be a constraint for firms that have built those foundations. The question is whether the firms are in readiness.

It is also important to note that when a firm attracts private capital, here would be expectations on accelerated growth. PE investors typically work to a five-to-seven year horizon, and within that window they expect to see growth, margin expansion, and a credible exit, whether through a secondary sale, a strategic acquisition, or in due course a public listing. That creates real pressure: pressure to grow faster than may be organically comfortable, to professionalise governance on a compressed timeline, and to demonstrate the kind of consistent reporting and forecasting discipline that an institutional investor expects. Firms that take private capital without a clear-eyed view of this pressure, and without the governance maturity to manage it, will find the relationship harder than they anticipated. This is precisely why readiness or willingness to adapt, is perhaps the way to evaluate the decision.

IV. VALUATION TRENDS AND VALUE DRIVERS

Typical valuations observed in PE transactions involving accounting firms have ranged from four and five times to mid-teens EBITDA as a broad range. Firms that have shown consistent growth in revenue and profitability and have great, diversified client relationships will typically end up on the right side of that equation. Firms which have not grown as fast, which are looking to exit, which have founder challenges or partner disputes, will be at the lower end of that range.

The drivers of premium valuation are really questions of firm quality. How strong is the brand in the market? How solid is the advice the firm delivers — is it the firm of choice for a certain type of problem? What are people saying when they come in as clients, and what are they saying when they leave? Has there ever been a partner dispute in the firm? How partner-dependent is it — could the firm have delivered the same outcome differently if key individuals had left? These are the questions that will come up in any due diligence. The answers will impact the valuation offered.

Leadership depth and succession planning deserve particular emphasis. A firm where client relationships and technical authority are concentrated in one or two founding partners faces a structural valuation discount, because the investor is effectively acquiring individuals rather than an institution. Building a genuine second line of leadership — ensuring that clients have relationships with multiple partners and senior managers, and that institutional knowledge is documented rather than residing in individual heads — takes years to execute but is among the highest-return investments a firm can make in its own future valuation.

V. GOVERNANCE CONSIDERATIONS: INDEPENDENCE, TRANSPARENCY, AND FIDUCIARY DISCIPLINE

INDEPENDENCE

Whenever there is an investor on the cap table, independence rules and conflict of interest rules become paramount. If investor has invested in an accounting firm, then the firm cannot accept audit mandates of the investor group. Even for investor’s portfolio companies, anything, if at all, will need proper conflict waivers and independence checks and the right governance approvals, without which the firm cannot accept engagements.

To be precise, this is not a single rule with an exception, but two distinct scenarios.

Audit services: largely, not possible. If an investor has invested in the firm, the firm cannot accept audit mandates for that investor or its portfolio companies.

Non-audit services: largely, possible, but only with fiduciary discipline. If the investor instructs the firm to handle a portfolio company’s financial planning, tax matters, MIS reporting, or similar advisory tasks, this may be structured as a non-audit engagement that does not create the same independence conflict — but only after the firm has reviewed independence pro-actively.

GOVERNANCE QUALITY: CAPITAL DEPLOYMENT AND TRANSPARENCY

One would also tend to look at governance from a broader perspective as well. Is the firm able to take the right decisions on deploying capital, on allocating capital, on using capital wisely? Is there proper transparency in decision-making – in the monthly and quarterly MIS meetings? Are the plans well shared and articulated? Is decision- making done through clearly defined processes and SOPs, so that there is no ambiguity about how divisions are driving growth and how resources are being allocated?

These are not bureaucratic requirements. They are the substance of what makes a PE-backed professional services firm actually work. Investors investing in an accounting firm are not investing in a project; they are investing in the firm’s leadership and in the firm’s processes. The governance processes of the firm, demonstrated through consistent investor reporting, credible and process driven performance reviews and clear strategic execution are what help in maintaining and growing investor relationship over the full investment cycle.

VI. STRATEGIC CONSIDERATIONS: BALANCING GROWTH, FUNDING, AND PROFESSIONAL INTEGRITY

It is very, very important for firm leaders to recognise that whilst funding will come, funding is a fiduciary responsibility that the partners — the CEO and the partners collectively — are assuming. Every single dollar, every single rupee raised from an investor has to be treated with the highest level of integrity and as a fiduciary obligation.

What this means is that no partner or leader can decide to spend money in isolation. Whether it is events and conferences, branding initiatives, or technology investments, every rupee of investor capital must flow through approved budgets and well-defined processes. The fiduciary standard demands discipline, structure, and accountability in every spending decision.

At the same time, professional integrity must be preserved not only in how capital is spent, but in how growth is pursued. The pressure to demonstrate returns to investors within a defined time horizon is real. It can, if left unmanaged, create incentives to prioritise revenue growth over quality, or to accept clients and mandates that compromise the firm’s independence or professional standards. Firm leaders must be explicit — with themselves and with their investors — about what growth the firm will and will not pursue. A reputation for integrity, once damaged, is not easily or quickly rebuilt. In a profession where reputation is the primary asset, protecting it is of paramount importance. It cannot be called a constraint.

The firms that will succeed in balancing growth, funding, and professional integrity are those whose leadership has thought carefully about all three before signing a term sheet. They will have a strategic plan that is ambitious, a governance framework that is robust, and a culture that holds the fiduciary standard as an extension of their core values. Those are the firms that will build enduring global institutions — and that will be remembered, decades from now.

CONCLUSION

The globalisation of Indian accounting firms is no longer aspirational. Clients, talent, regulation and capital are all globalising. Professional firms must adapt and evolve with this trend.

This evolution requires capital — for technology, for talent, for brand, for global presence. It requires a revenue model built for scale: growing at double-digit rates, priced appropriately for the value delivered, and structured to improve margins as the firm grows. It requires an understanding of what private equity investors see in this sector — and the governance discipline to manage their capital with the fiduciary responsibility. And it requires the strategic clarity to pursue growth in a way that preserves, rather than compromises, the professional integrity that makes accounting firms worth investing in at all.

Indian accounting firms have the talent, the reputation and the ambition to become genuine global institutions. What remains is the resolve to invest accordingly; and all this with the wisdom to do so in a manner worthy of our noble profession.

The views expressed are personal.

BCAJ Admin

For Indian accounting firms aiming for global scale, technology is no longer a mere support function; it is the core infrastructure driving growth. To seamlessly deliver services across borders, firms must invest strategically in cloud computing, artificial intelligence, and integrated collaboration platforms. This technological foundation enables standardized workflows, centralized knowledge management, and robust professional governance. However, successful adoption requires navigating significant challenges, particularly change management, cybersecurity threats, and stringent data privacy regulations. Ultimately, technology should not replace professional judgment but rather amplify human expertise, ensuring firms maintain the unwavering quality and trust demanded in a complex global marketplace.

As leaders of professional services firms, we are witnessing a defining shift in how accounting firms must prepare for growth. India’s accounting firms today operate in an increasingly global, connected, and demanding marketplace, where ambition is no longer limited by geography, but enabled by capability.

In this environment, technology must be understood not as a support function, but as core infrastructure. It is the foundation that allows firms to scale consistently, serve clients across jurisdictions, navigate regulatory complexity, and maintain the standards of quality and trust on which the profession is built. The firms that will lead in the years ahead will be those that deliberately embed technology into how they operate, collaborate, and deliver value. The firms should empower partners and practitioners to choose their technology roadmap that aligns with the firm’s purpose, ethics, quality standards while staying compliant with the laws of the land.

This article breaks down why technology is the very infrastructure that keeps modern global service delivery running. We’ll look at how to build scalable models, where to invest your capital, how to manage the risks, and how to tackle the practical challenges that come with it.

I. TECHNOLOGY IN GLOBAL DELIVERY

Global delivery is the beating heart of a modern accountancy practice, and technology is the circulatory system that keeps it running smoothly. Where the focus used to be simply on labor arbitrage – offshoring work and providing round-the-clock service coverage – today’s real value lies in a unified experience built on cloud, analytics and artificial intelligence.

The cloud completely dissolves physical boundaries. Clients expect information on demand, not just when their partner finishes travelling between meetings. At the same time, businesses are squeezing margins to the limit, forcing service providers to focus their energy on genuine value creation rather than back-office housekeeping. The friction of moving data across physical offices disappears when teams log onto a common platform.

The global delivery model powered by technology is often called a process-driven model. Standardized workflows are defined once and carried out synchronously across geographies.

These workflows can move from the UK to India to Australia without interruption, with quality checkpoints embedded into the daily routine so that consistency is built into the process. Technology also makes each stage of work transparent and traceable, replacing the older approach in which senior partners often reviewed only the final output.

EXAMPLE – BORDERLESS COLLABORATION

Client onboarding can be made much simpler through digital workflows. Instead of exchanging scanned forms over email, firms can use secure cloud-based portals where clients submit their information directly. A client entering data in New Delhi can have it instantly available to teams in Mumbai, while automated checks can identify potential issues early and partners in Dubai can review exceptions in real time. Processes that once depended on people working in the same office can now connect teams across cities and countries, making collaboration faster, smoother, and more efficient.

Today, firms can operate seamlessly across time zones, turning global teams into a round-the-clock delivery model. As one team finishes its day, another can pick up the work, helping projects move forward continuously. By using tools such as Microsoft SharePoint for document management, OneDrive for file sharing, and Teams for collaboration, firms can reduce version-control issues and improve visibility across locations. A deliverable can be prepared in one country, reviewed in another, and checked for compliance elsewhere—all while working from the same set of documents and maintaining clear audit trails. The real opportunity is not simply working across geographies but creating an infrastructure that enables teams to collaborate as if they were in the same office.

A. CLOUD

Cloud infrastructure is the baseline of global delivery. Data and applications live in secure remote data centers maintained by specialists, accessible from anywhere with a safe login. This eliminates upfront server costs, removes local installation headaches, and unlocks serious computing power right when you need it most – like during quarter-end reporting or heavy year-end reviews. Typically, mid-sized professional services firms invest between 5–10% of their revenue into overall technology, with the lion’s share going into storage, compute power, and integration layers. Larger firms push that figure toward 10–15% or more to support thousands of simultaneous users¹.

1 Gartner Nasscom

From a technical standpoint, the big wins are centralized identity management, common APIs and built-in redundancy. These enable secure access to sensitive client data, seamless integration across tax, audit, and accounting systems, and uninterrupted service delivery. From a business perspective, the pay-as-you-go model ties your cost directly to consumption, aligning your expenses with the client engagements that bring in revenue.

EXAMPLE – SCALABILITY POWERED THROUGH CLOUD

Business demands can change quickly, especially during peak periods such as year-end financial closes when workloads increase significantly. With cloud platforms like Microsoft Azure, firms can scale their computing capacity up or down as needed, often within hours rather than weeks. Additional resources can be deployed securely and in line with regulatory and compliance requirements, helping teams manage higher workloads without investing in permanent infrastructure. Once demand returns to normal, those resources can be scaled back, ensuring organizations pay only for what they use. For finance and BPO firms, this flexibility helps ensure that technology capacity supports business needs, even during the busiest periods.

B. ARTIFICIAL INTELLIGENCE AND ANALYTICS

AI is no longer a futuristic concept. It sits right alongside a practitioner’s desk, embedded directly into core platforms. Machine learning models classify account balances, flag deviations from normal patterns, draft narrative commentary, and turn complex regulatory updates into quick reminders. When you combine analytics with visualization tools, engagement managers can spot trends across hundreds of clients at once, scanning a clear heatmap instead of drilling into endless spreadsheets.

EXAMPLE – GENERATIVE AI FOR INTERNAL AUDIT FUNCTION

Generative AI can help firms review internal control documentation more efficiently by identifying potential gaps, inconsistencies, and areas that may not align with established compliance frameworks. While human expertise remains essential for validation and decision-making, AI can significantly reduce the time spent on manual reviews. This allows professionals to focus on higher-value advisory work, improve productivity, and support a growing client base without a proportional increase in headcount.

Professionals reviewing tax computations, audit observations, or compliance outputs provide feedback on AI-generated results, allowing the models to learn from corrections and improve over time. However, if the underlying training data or human inputs contain inconsistencies or biases, the system can reinforce those patterns. This makes robust model governance, periodic validation, documented audit trails, and oversight by experienced professionals essential to ensure accuracy, fairness, and regulatory compliance.

Firms must budget beyond AI platforms, account for data management, cybersecurity, model monitoring, and skilled talent. Investments often include analytics tools, RPA, predictive engines, and ongoing model refinement, making AI a continuous capability rather than a one-time expense.

C. COLLABORATION PLATFORMS

Collaboration is the glue that keeps distributed teams together. Platforms that bring together messaging, video, document editing and project tracking eliminate the constant context-switching tax that happens when practitioners are forced to juggle half a dozen disconnected tools.

A half-hearted adoption leaves email as the only common denominator and completely defeats investment.

Enterprise-grade chat and document management systems enforce retention policies, role-based access, and detailed audit logs. Because they integrate directly with the cloud backend, clicking a link opens the correct version of a spreadsheet instantly without forcing you to download it to your desktop. The business benefit is highly measurable: teams report 40–60% less time wasted chasing status updates, leaving more room to focus on client insights.

EXAMPLE – COLLABORATION TOOLS

Microsoft Teams enables multiple teams to communicate seamlessly through chats, virtual meetings, and shared workspaces, while SharePoint serves as a centralized repository for engagement files, standard templates, and knowledge resources with robust version control. Project management tools such as Asana help track assignments, statutory deadlines, and team responsibilities. Meanwhile, DocuSign streamlines client interactions by enabling secure digital execution of engagement letters, approvals, and other critical documents. Together, these tools foster better collaboration, governance, and operational efficiency across the firm.

EXAMPLE – SMART BOARD FOR GLOBAL TASK MANAGEMENT

Digital collaboration platforms can help firms manage work more efficiently across teams and locations. Tasks can be assigned, tracked, and reviewed through a shared workspace, giving everyone real-time visibility into progress and responsibilities. AI-powered tools can further support teams by summarizing key updates, highlighting outstanding items, and facilitating smoother handoffs between team members. By reducing the need for frequent status meetings and manual follow-ups, firms can free up more time for focused, value-added work while improving overall productivity.

II. STRATEGIC ROLE OF TECHNOLOGY

Technology is a strategic asset, not a commodity. Too often firms treat IT spend as a line-item cost center to be minimized. They adopt a bare minimum of tools, piece them together in an ad hoc way, and then wonder why workflows fall apart across engagement teams.

A more enlightened view positions technology alongside people and capital as one of the three core pillars of the business. When technology is consciously backed by investment – and aligned with professional judgment, it becomes a powerful engine for scalability, consistency, and continuous improvement.

A. SCALABILITY AND STANDARDIZATION

Firms that scale responsibly are the ones that standardize their work. The invisible scaffolding of reliable templates, defined roles and prebuilt workflows allows partners to redeploy talent from one client to another without endless retraining. Standardization makes the intangible tangible: Standardization helps firms maintain consistent quality and deal with exceptions in a structured and efficient manner.

Technically, this means using common APIs across systems, standardized file naming conventions, and centralized repositories indexed by task rather than office location. The core business logic is simple: when an associate in Pune produces work measured in the same units as one in New York, there’s zero translation cost for the partner overseeing both.

EXAMPLE – STANDARDIZING ACROSS OFFICES

As professional services firms grow, they often develop different ways of working across teams and locations. Standardizing processes and moving from scattered spreadsheets to a unified system with built-in controls, workflows, and templates can help create greater consistency in service delivery. With a common approach, teams can complete work more efficiently, reduce variations in output quality across offices. Quality reviews can then focus less on identifying routine errors and more on applying professional judgement.

B. KNOWLEDGE MANAGEMENT

Knowledge is the core currency of any professional services firm. Technology unlocks it from the closed circuits of individual minds and puts it into a shared communal vault. By centralizing precedents, templates, rationales, regulatory interpretations, and benchmarks in easily searchable hubs, firms can help everyone reach top-level performance.

The technical building blocks here include knowledge graphs, tagging schemas, version-controlled wikis, and QMS systems integrated with engagement workflows. Business rules drive mandatory usage: a partner literally cannot proceed until the appropriate checklist is ticked or a required commentary is entered. Meanwhile, confidentiality is woven into the fabric of the platform, meaning any unexpected exposure of client data immediately triggers alerts and audit actions.

EXAMPLE – CENTRALIZED KYC REPOSITORY

Knowledge retention and easy access to information are increasingly important challenges for growing organizations. As teams expand and expertise becomes distributed across locations, firms need effective ways to capture, organize, and share institutional knowledge. Interactive learning and development platforms can help address this by digitizing training materials, best practices, and subject-matter expertise, making them easily accessible whenever employees need them.

C. PROFESSIONAL GOVERNANCE

Professional firms are strictly bound by codes of conduct, ethical obligations and rigid quality standards. Without technology that encodes those expectations into the daily workflow, governance simply lives in unread manuals and on whiteboards – inert and quickly forgotten.

A modern professional governance platform ties compliance directly to daily actions. The digital signature itself records who signed to what and when.

For instance, to sign off on a piece of work, a partner must confirm that the conflict check passed, peer review was completed, and no open issues remain. Behind the scenes, the system simply ensures that each required step is completed and verified before work can move to the next stage. This turns broad ethical and quality requirements into clear day-to-day actions that everyone follows consistently. Over time, the information collected helps identify where additional training is needed, where delays occurring, and where existing processes need to be updated.

D. SUSTAINING AND GROWING THE BUSINESS

Clients now demand the same accuracy and speed from professional services firms, that they would expect in their day-to-day life. With technology in everyday use, firms that fail to provide digital touchpoints will lose business to more tech-forward firms as these firms will be able to provide better outcomes at cheaper price. Embracing technology has become inevitable for the firms to remain in business.

Firms who have embraced technology will also be able to launch new-age services, increase global reach and build efficient processes thereby leading to business growth.

III. TECHNOLOGY STRATEGY IN ACTION

Technology delivers the greatest value when it is aligned with an organization’s operational needs and long-term business goals. However, many firms struggle with where to begin their transformation journey and how to prioritize investments. As organizations grow and expand across geographies, success often depends on a combination of standardized processes, integrated systems, and strong governance. While challenges are a natural part of any transformation effort, a phased and practical approach can help firms manage change effectively, build momentum, and achieve sustainable results.

A. FIRM SIZE AND TECHNOLOGY MATURITY

Technology maturity does not necessarily correlate with firm size. While larger firms often have greater resources to invest in technology, smaller firms can also achieve high levels of digital maturity through focused investments and cloud-native platforms. A firm’s position on the maturity curve is shaped by factors such as leadership priorities, legacy systems, client expectations, operational complexity, and investment strategy rather than headcount alone.

A straightforward maturity framework helps a firm decide exactly where to invest next:

• Level 1 (Emergent): Technology barely touches the core process.
• Level 2 (Established): common tools are adopted and basic integration begins.
• Level 3 (Optimized): the tech stack is unified, intelligent and continuously improved.

Smaller firms often begin at Level 1 and progressively adopt integrated platforms as they grow, while many mid-sized and larger firms aim for Level 2 or Level 3. However, these are broad tendencies rather than fixed rules, and firms of any size may operate at any maturity level depending on their strategic priorities and technology investments.

EXAMPLE – A FIRM’S JOURNEY THROUGH MATURITY LEVELS

Technology transformation journey is a series of incremental improvements rather than a single transformation project. As firms grow, manual processes, spreadsheets, and disconnected systems often become difficult to manage, prompting the move from Level 1 (Emergent) to Level 2 (Established). This transition usually involves adopting integrated practice management, collaboration, or workflow tools. Common challenges include process standardization, data migration, training, and resistance to change.

The progression from Level 2 (Established) to Level 3 (Optimized) focuses on connecting systems, improving data quality, automating routine activities, and leveraging analytics and AI to support decision-making. At this stage, firms often face challenges related to integration, governance, cybersecurity, and ensuring that technology investments generate measurable business value.

Firms may pursue this journey through either a phased implementation or a full-scale transformation. A phased approach spreads costs over time, reduces disruption, and lowers implementation risk, although benefits may take longer to materialize. A full-scale transformation can deliver faster and more comprehensive benefits but requires greater upfront investment, stronger change management, and carries higher execution risk.

The appropriate path depends on the firm’s strategic objectives, operational complexity, available resources, and readiness for change.

B. TECHNOLOGY AS A STRATEGIC INVESTMENT

Investing in technology means accepting upfront costs in exchange for serious operational agility down the line. Firms that underinvest risk being left behind by competitors who harness automation, analytics and connectivity to deliver deeper insights at a much lower marginal cost. Too many practices view their IT spend through a narrow, defensive lens. A better approach sees extra spend as purchasing optionality – giving you – more flexible infrastructure, more powerful tools, and richer data at your fingertips.

Typical benchmarks for professional services put IT spend around 4–7% of revenue for nascent firms, 5–10% for those on a clear growth trajectory, and 10–15% or more for advanced global players.

These ranges are not strict rules but benchmarks to climb. Firms calibrate them to their own strategy, risk appetite, and long-term ambition.

EXAMPLE – ROI-DRIVEN TECHNOLOGY SCALING

Allocating a small percentage of revenue to a cloud-based CRM platform can help improve client engagement, strengthen relationship management, and create opportunities for repeat business. As the firm matures, investments may expand to include integrated finance, reporting, and analytics platforms that provide deeper operational and client insights. To maximize value, technology investments should be evaluated regularly against business outcomes, ensuring they are viewed as strategic enablers of growth rather than simply operating expenses.

A balanced investment approach carefully weighs cost vs. actual value and opportunity cost. If the firm doesn’t invest today, competitors will; if it overinvests in the wrong tech, it will end up locked into rigid, unfit solutions. Smart investors balance a solid baseline of core capabilities with a small portfolio of experimental bets, listening closely to feedback from practitioners and partners alike.

C. GLOBAL SCALING & THE DELIVERY MODEL

Scaling a firm beyond a single geography means divorcing knowledge from physical location. A report might be drafted in Chennai, reviewed in Cape Town, and filed in London. Technology dissolves that distance, but only if it’s paired with absolute process discipline.

Standardized end-to-end workflows break complex assignments into segments that can be assigned. Automated reminders and real-time deadlines keep progress on track, while quality gates built directly into the workflow orchestration ensure client data stays completely current.

The journey from partner-centric to institution-centric delivery requires codifying historical knowledge. The institution now embeds smart cues right into the workflow itself, so the next person can effortlessly pick up where the last person left off.

Cloud encryption and identity management ensure that only the parties with a strict ‘need to know’ can ever see the relevant portions of a file.

EXAMPLE – FOLLOW-THE-SUN DELIVERY

Firms with multi-geography teams can benefit significantly from standardized processes and shared digital platforms. By establishing common workflows and review standards, work can move seamlessly between teams in different time zones, creating a continuous delivery model. A task initiated by one team can be reviewed, refined, and finalized by others as the workday progresses around the world. This enables firms to accelerate turnaround times, improve collaboration across locations, and respond more quickly to client needs while maintaining consistency and quality.

D. INTEGRATION & GOVERNANCE

Going beyond individual tools, integration is where the real value starts to compound. Without it, email attachments and manual reconciliations remain the norm. An integrated platform shares a single source of truth: the numbers in a client’s balance sheet appear identically across the risk dashboard, the delivery timeline, the team’s mobile app, and the partner’s briefing pack.

Integration requires a reliable backbone bus or API contract with a common language, shared endpoints, and consistent schemas. Role-based access and strong identity management enforce the principle of least privilege. Retention policies are automatically applied so that records expire or transfer to archives strictly according to local law and firm policy. Every single click and keystroke is securely recorded in audit logs.

The system prevents a partner from overlooking the firm’s obligations, and the partner ensures the system doesn’t escape unchecked scrutiny.

EXAMPLE – INTEGRATION OF SYSTEMS FOR CLIENT MANAGEMENT

A firm can capture all leads in a centralized CRM platform and integrate it with contract management, finance, and other operational systems. This enables client information to flow seamlessly across the organization, reducing manual effort, improving data accuracy, and providing a unified view of client relationships across service lines.

Approval workflows live directly within the application. A draft simply cannot be moved to “signed” until the reviewer explicitly acknowledges all open issues and the contract manager has digitally countersigned. These fine details are what build a true governance culture.

EXAMPLE – ENTERPRISE IDENTITY AND TWO-FACTOR AUTHENTICATION

Implementing technologies such as multi-factor authentication, role-based access controls, and biometric verification can help validate user access before information is shared or transferred. At the same time, automated audit trails can record key access and activity events, providing greater transparency, strengthening governance, and supporting compliance requirements.

E. IMPLEMENTATION CHALLENGES & APPROACH

The journey to becoming a technology-enabled firm is full of real-world obstacles. The primary challenge is managing the change and people’s expectations. Most technology implementations fail because of change mismanagement. Integrating legacy systems, navigating interoffice politics, managing vendor divergence and fighting resistance to change can all slow progress down.

Another challenge that firms face is to get comfort on an ROI which is way in the future. As mentioned earlier, investment in technology will not just help in growing the business but also in sustaining the existing business. If this is factored in the decision making, ROI becomes much clearer and obvious. Implementation demands genuine patience; a credible program typically runs for 24–36 months and treats technology as a living art rather than a one-time sunk cost.

One of the other subtle challenges is the balance between global vs. local alignment: central policies need local context to actually resonate, otherwise they remain paper tigers. For example, technology implemented centrally for KYC compliances without taking into consideration local law requirements may not have acceptance in some regional offices.

One of the most significant decisions firms face is whether to pursue a phased implementation or a full-scale transformation. As discussed in Section III-A, the right approach often depends on the firm’s technology maturity. Firms at Level 1 (Emergent) typically benefit from a phased approach, introducing foundational systems and standardizing processes before moving to deeper integration and automation. Firms at Level 2 (Established) may be better positioned for broader transformation initiatives involving analytics, AI, and enterprise-wide integration.

While a phased approach reduces disruption and implementation risk, a full-scale transformation can deliver benefits faster but requires greater investment, stronger change management, and higher execution discipline. The appropriate path depends on the firm’s readiness, strategic priorities, and capacity to manage change.

IV. RISK AND GOVERNANCE

Firms today face a faster, more interconnected risk landscape that traditional governance models – periodic reviews, spreadsheets, siloed teams and annual audits – can no longer manage. Regulators aren’t just looking for a compliance manual gathering dust on a shelf – they want real time proof that your controls work in the real world.

The key is having an integrated Governance, Risk and Compliance (GRC) platform. Only integrated, technology-enabled GRC platforms can provide real-time visibility across risks, controls, incidents, vendors, and compliance obligations.

A. CYBERSECURITY AS A STRATEGIC PRIORITY

Cybersecurity has shifted to become one of the most critical strategic priorities for governments, businesses, and individuals alike due to the rapid evolution of threats, technologies, and global dynamics. Cyber attacks are becoming faster, more complex, and significantly harder to detect. AI has further added to the risk. AI is a double-edged sword: it powers smart, automated defences, but it also gives rise to highly sophisticated, automated attack vectors Build a Cyber-Aware and Security –First Culture, with a theme – “Do your part be Cybersmart”.

This calls organizations to Prioritize cybersecurity investments based on risk criticality and business impact. Strengthening Supply Chain and Third-Party Cyber Security are commonly referred to as Vendor Risk Management. Cyber security requires a proactive and resilience –focused approach. (Refer table for some proactive measures).

CYBERSECURITY CHECKLIST FOR CA FIRMS

√ Restrict access to client files based on roles and responsibilities.

√  Use strong passwords, multi-factor authentication, and secure login practices.

√  Ensure vendors, software providers, and outsourcing partners follow adequate security standards.

√  Clearly define data protection responsibilities in vendor and client agreements.

√  Periodically review systems for vulnerabilities and promptly fix identified issues.

√  Establish clear policies on the use of AI tools and prevent sharing confidential client information on unapproved platforms.

√  Maintain regular backups and periodically test whether critical data can be restored successfully.

√  Have a business continuity and disaster recovery plan for major disruptions.

√  Conduct regular employee awareness sessions on phishing, fraud, and data protection.

√  Encourage every team member to treat client information as confidential and report suspicious activities immediately.

B. DATA PRIVACY AND LOCALIZATION

Data privacy and localization are no longer mere footnotes: many jurisdictions strictly require client data to remain on local soil and be processed under local laws. Robust GRC means tying data sovereignty rules directly back into your access permissions and embedding them into the platform so that a file stays in the right country, even when it moves across a global screen. Local jurisdictions also need the contracts to be localized ensuring the local compliance as well as industry compliance (eg: Standard global engagement contract by client in US or UK may need localization like GST, AML obligations, professional standards issued by ICAI, for appointing Indian CA firm). Some jurisdictions may not accept DSC and will mandate wet signatures.

India’s Digital Personal Data Protection (DPDP) Act, 2023 places clear obligations on organizations to collect, use, store, and protect personal data responsibly. It requires appropriate consent mechanisms, security safeguards, and breach reporting procedures, while holding organizations accountable for protecting personal information throughout its lifecycle. For CA firms, compliance with DPDP has become a critical component of technology governance and client trust.

EXAMPLE – PRIVACY BREACH RESPONSE IN ACTION

Even with strong controls in place, firms may occasionally face situations where sensitive information is shared unintentionally. In such instances, a structured incident response process can help contain the issue, assess potential impact, notify affected stakeholders where necessary, and implement corrective actions. These experiences often highlight opportunities to strengthen privacy controls through technologies such as data loss prevention tools, access monitoring, and automated alerts that can detect unusual data-sharing patterns and help prevent future incidents.

Governance is the art of guiding emerging capabilities toward professional benefit and away from emergent harm.

Other modern risks demand the exact same discipline: AI bias (unfair or inaccurate outcomes), model poisoning (manipulation of AI training data), privacy leaks (exposure of confidential information), rogue insider access (misuse by authorized users), algorithmic opacity (difficulty in understanding how an AI system reached a conclusion), and the dangerous assumption by a partner that technology somehow absolves them of professional responsibility instead of actively amplifying it.

Firms should ensure that client engagement letters, technology vendor agreements, and data processing contracts clearly define responsibilities, liability limits, and data protection obligations. Appropriate professional indemnity and cyber insurance can provide an additional layer of protection against residual risks.

CONCLUSION

Technology is no longer a support function for accounting firms – it is the infrastructure that enables scale, consistency, collaboration, governance, and client trust. Firms that adopt cloud platforms, AI-assisted workflows, integrated collaboration tools, and strong governance frameworks will be better positioned to serve global clients and deliver higher-value services.

However, technology adoption must be purposeful. Underinvestment can leave firms inefficient and uncompetitive, while investing in disconnected tools can create unnecessary complexity. The goal is to build a coherent digital foundation aligned with the firm’s strategy, service model, and professional obligations.

For Indian accounting firms operating in a global environment, technology is now central to sustainable growth. It helps standardize processes across offices, preserve institutional knowledge, strengthen cybersecurity and data privacy, and manage risk more effectively.

EXAMPLE – TECHNOLOGY ENABLING GLOBAL CLIENT DELIVERY

Consider a client with operations across India, the UK, and the Middle East. Using a common cloud platform, standardized workflows, collaboration tools, and centralized knowledge repositories, teams across locations can work on the same engagement while maintaining consistent quality standards and complete visibility. Client queries can be routed to the appropriate specialists, documents can be accessed securely, and progress can be tracked in real time. The result is faster turnaround, greater transparency, and a seamless client experience regardless of where the work is performed.

The firms that will succeed will not be those that adopt the most software, but those that combine technology with sound professional judgement, strong governance, and a clear client-centric strategy. Technology should amplify human expertise – not replace the responsibility and trust at the heart of the profession.

BCAJ Admin

Indian professional firms have a unique opportunity to expand globally, driven by client needs and the desire to elevate professional standards rather than domestic limitations. Successful globalization requires moving beyond commoditized compliance to offer high-value, partner-led judgment. Rather than merely exporting Indian staff, firms must build diverse, local teams to establish true international credibility. Furthermore, firms must transition from personality-driven models to systemic leadership architectures. Ultimately, globalization acts as a rigorous diagnostic test, exposing structural weaknesses and demanding an internalized culture of uncompromising quality and excellence across all borders.

I have been asked many times—by younger professionals, by firm founders, by partners considering their next move—what it actually takes to build a practice that works across borders. My honest answer is always the same: less than you think on the infrastructure side, and far more than you expect on the human side.

People focus on the relatively irrelevant things. They talk about office locations, billing structures, brand guidelines, referral arrangements. All of that matters, eventually. But none of it is the hard part. The hard part is whether your institution’s thinking—not just its name, but its actual standards, instincts, and culture—can survive being transplanted into a different location, a different country, a different language, a different commercial environment, and a different set of professional norms.

Most of the time, it may not. And the reason it may not is rarely what the firm’s leaders think it is.

WHY GO GLOBAL AT ALL?

Let me start with a question that doesn’t get asked enough: why should an Indian professional firm globalise in the first place?

I ask because the answer is not as obvious as it sounds, and because firms that get the answer wrong tend to globalise badly. If the motivation is prestige—if it is about having an address in Dubai or Singapore so that the firm can describe itself as international—then the result is typically a small, under-resourced outpost that serves as a vanity project and a drain on the home practice. I have seen this happen. It is more common than it should be.

As I speak to a number of professionals including Chartered Accountants, lawyers and other advisors, the point I invariably hear is that opportunities in India are limitless. Why go elsewhere? This is very understandable. India is a high performing growth story. Others are coming to India; why should we go elsewhere? The real reasons to go global are different. They certainly are not lack of opportunity in India.

The Indian Chartered Accountant is, by any honest assessment, among the most capable professionals that any accounting and advisory practice can employ. The qualification is genuinely hard. The training is genuinely broad. When an Indian CA sits across from a client or a counterpart anywhere in the world and demonstrates what they know—across financial reporting, taxation, corporate law, regulatory frameworks—there is a recognition that this person has been through something serious. That credibility is real, and it is portable. What is not portable, historically, is the institutional framework around that individual. We produce excellent professionals. We have been slower to produce excellent firms.

That gap is the opportunity. And the pressure to close it is now coming from the market itself.

Indian companies are not domestic businesses that occasionally venture abroad. They are genuinely global—acquiring overseas assets, managing cross-border supply chains, listing on international exchanges, navigating BEPS and Pillar Two and transfer pricing regimes across multiple jurisdictions simultaneously. These clients need advisors who can follow them. Not advisory networks that pass files between loosely affiliated member firms, but integrated practices with genuine multi-jurisdictional competence and a single point of accountability.

Beyond the client imperative, there is a professional one. A firm that operates only in one market tends, over time, to mistake local convention for universal best practice. It stops questioning its own assumptions because those assumptions are never tested from the outside. Global exposure—the discipline of competing in markets where your incumbency and relationships give you no advantage—forces a rigour that purely domestic practices rarely achieve. I genuinely believe that our Indian practice became better because of what we learned building our international ones. The causality runs both ways.

THE UAE: WHAT WE LEARNED BY GOING EARLY

In April 2017, we opened our office in the UAE. At the time, this was considered, by most people we spoke to, premature at best and inadvisable at worst; particularly by a firm which was doing very well in India.

VAT was being discussed, yes. But there was genuine uncertainty about whether it would actually happen. The region had positioned itself as a tax haven. VAT was thought to be counterproductive. Implementation on the announced timeline seemed, to many observers, ambitious. The advice we received, from people who knew the market well, was to wait and see.

We decided not to wait.

There was a prospective client—a well-established business in the Emirates—who told me, with some amusement, that he would call us on 1 January if the VAT actually came in. It was a polite way of saying he thought we were getting ahead of ourselves.

On 1 January 2018, VAT was introduced. He called, as promised. And because we had been on the ground for the better part of a year, we were ready in a way that firms arriving in January simply could not be. We had already built relationships, understood the local regulatory machinery, hired and trained people. When corporate tax followed some years later, the compounding effect of that early presence was substantial.

Today our UAE practice has around 150 professionals and is, by most assessments, one of the largest dedicated tax advisory practices in the country. From there, we expanded into Saudi Arabia as that market’s tax and regulatory environment developed its own complexity, and also into Singapore, where the nature of the work is somewhat different—more international structuring, more cross-border transactions, a different category of client conversation.

Each of these moves followed the same logic. Not going where the opportunity already exists, but going where the client need is forming, before it has fully formed. This requires a particular kind of institutional confidence—the belief that you can deliver something genuinely valuable in a new market, even before that market has validated you.

Getting that confidence right is the difference between conviction and recklessness. It has to rest on honest self-assessment. If you know what you can actually deliver, and why sophisticated clients will value it, then timing an entry into a developing market is a calculated bet. If you don’t know—if you’re entering because the opportunity looks large and you want a piece of it—then you are gambling with the firm’s reputation in a market that will find you out quickly.

BEING CLEAR ABOUT WHAT YOU ARE OFFERING

Every new market has the same initial dynamic: you arrive as an unknown. The clients who will eventually become your best relationships don’t know you. The referral sources are working with other firms. The market’s trust is elsewhere.

The question is what you have to offer that is distinctive enough for a client to take the initial risk of engaging you.

In tax advisory specifically—which is Dhruva’s core practice—the answer is not difficult to articulate, but it is not always honestly examined. Much of what passes for tax advice in most markets is actually tax compliance: competent, necessary, but ultimately commoditised. Any established firm can file a return, prepare a transfer pricing report, or manage standard corporate tax obligations. Clients know this, and they price it accordingly.

What is genuinely scarce—and what sophisticated clients will pay significant fees for—is judgment. The ability to read a regulatory framework and identify the position that is both legally sound and commercially intelligent. The ability to tell a client something they don’t want to hear before it becomes expensive. The experience of having seen how similar questions have been resolved across multiple jurisdictions, and applying that comparative perspective to a specific problem. That is not a commodity. It cannot be manufactured at scale. It requires partner-level involvement in every substantive engagement. We distinguished ourselves as a partner-led firm which stood apart from the competition and gave us a competitive advantage.

This is the positioning we chose, and I think it was right. But I want to be honest about something: it is also a constraint. A partner-led, judgment-intensive practice does not scale in the same way that a process-oriented compliance business does. Growth requires finding, developing, and retaining partners who are genuinely capable of that level of advisory work—not just technically competent administrators. That talent pool is smaller than it looks from the outside.

Too many Indian firms go international to look large. They end up with offices that produce neither the revenue nor the reputation that justified the investment. The firms that build something durable are those that go global to become better—and that have a clear, honest answer to the question of what they are distinctively good at. To compete effectively it is.

THE TALENT QUESTION: HARDER THAN IT LOOKS

When I think about what has actually determined the quality of our international practices, the honest answer is: the people we hired in the first eighteen months of each office.

Not the strategy. Not the brand. Not even the client relationships we brought with us. The people.

This is counterintuitive to firm leaders who are used to thinking about talent as an operational matter—important, obviously, but downstream of the strategic decisions about markets and positioning. In a global expansion, it’s the opposite. The early hires determine almost everything: the quality of the work, the relationships that develop with clients, the culture that the subsequent hires join, and ultimately whether the office becomes a real practice or an expensive holding position.

We made some decisions early that were, in retrospect, correct, though they weren’t obvious at the time. One of them was to resist the temptation to staff our international offices primarily with Indian professionals who were available. The available-people instinct is understandable—they know the firm, they’ve been trained in the firm’s methods, they’re low-risk in a certain sense. But if you staff a Dubai office with ten Indians and present yourself as an international firm, sophisticated local clients will see through it immediately. You’re not an international firm. You’re an Indian firm with a UAE phone number.

Real international credibility requires teams that genuinely reflect the market. In our UAE practice, we have professionals from India, from the Arab world, from South and Southeast Asia, and from other markets. This is not a diversity initiative. It is a practical necessity. When we are advising an Emirati family business on the implications of corporate tax for their holding structure, having team members who understand the cultural context of that conversation—not just the technical framework—is not a nice-to-have. It changes the quality of the advice.

On retention: the standard assumption is that compensation is the answer. Pay people well and they stay. In my experience, this is true up to a point—probably the point at which the person is no longer worried about the basics—and largely false beyond it. What actually retains talented professionals in a growing practice is participation. Meaningful work. Some sense that their own trajectory is connected to the firm’s trajectory, and that their input matters. Professionals who join a new office and are treated as instruments of delivery rather than co-builders of something tend to leave when they have developed enough to have options. And the ones who leave are, by definition, the best ones.

Building the talent pipeline for international markets also requires patience that many firm leaders struggle with. The best local talent will not join you in the first few months. They observe. They ask around about how the firm treats its people. They wait to see whether the promises in the recruitment conversation correspond to the reality. The reputation you build as an employer in the first year of a new office is as important as the reputation you build as an advisor—often more so, because the advisor reputation is built on a handful of client engagements, while the employer reputation propagates through the professional community at large.

LEADERSHIP AS ARCHITECTURE, NOT PERSONALITY

The professional services model in India has historically been personality-driven. There is a senior partner who has relationships, who brings in clients, who is the face of the practice. This works remarkably well at a certain scale. I have seen domestic practices built on the strength of one or two extraordinary individuals that generate revenues and client loyalty that most firms would envy.

But it does not travel. And this is one of the places where Indian firms going global most consistently underestimate the challenge.

The founding partner of an Indian firm entering a new market is unknown in that market. The relationships cannot be transferred because they are personal. The client’s trust in the senior partner’s judgment is a function of years of interaction and delivered value—you cannot replicate that by arriving in a new city with a well-designed pitch deck.

What you can do—what you must do—is build a leadership architecture that is systemic rather than personal. This means developing partners who have genuine authority within the practice and genuine accountability for outcomes. It means ensuring that client relationships are owned by the practice and not by any single individual, so that a partner’s departure does not take the relationship with it. It means creating quality frameworks that are embedded in how the work is done, not dependent on the senior partner reviewing everything personally.

I want to be direct about this because it has been one of the more difficult cultural shifts within Dhruva as we have grown. We were, in our early years, a partner-intensive practice in the sense that the senior partners were involved in almost everything. That model produced excellent work. It was also not scalable. Building the next generation of leadership—identifying individuals who have both the technical capability and the firm-building instinct, developing them, giving them real authority before they have been fully tested—requires accepting a degree of uncertainty that is uncomfortable.

The partners who succeed in global practices are a specific type. Technically strong, obviously. But also genuinely interested in building—in developing junior professionals, in creating institutional capability rather than personal leverage. And culturally resilient—able to maintain the firm’s standards and instincts in their market without constant reinforcement from the centre. If culture in your firm depends on the physical proximity of the founders, then you do not yet have a culture. You have supervision.
Succession in global practices is harder than in domestic ones, and it needs to be planned earlier. Domestic practices can sometimes sustain themselves through generational transitions on the basis of inherited client relationships—a long-standing client stays with the firm when the senior partner retires because the relationship has become institutional over time. In international offices, where relationships are newer and less deeply embedded, the systems and quality frameworks must carry more of the weight. That means they need to be built properly long before they are needed.

WHAT CULTURE ACTUALLY MEANS

Culture gets talked about constantly in professional services firms, and it is almost always described in terms of values statements or firm histories. Neither of those is culture. Culture is what happens when no one senior is in the room. What happens when no one is watching over your shoulder.

I mean that very specifically. When a junior associate is drafting an advice note at eleven at night and realises there is a complication that would require a difficult conversation with the client—does she raise it or find a way to work around it? When a partner is being pressured by a commercially important client to take a technical position that the partner privately believes is wrong—does he push back or find a way to frame the answer that gives the client what they want? When an office is having a bad quarter and a piece of work comes in that is at the margins of the firm’s standards—does the team take it or decline it?

The aggregate of those decisions, made hundreds of times a year across all the firm’s offices, is the firm’s actual culture. And the only way to build a culture that is consistent across geographies is to have those decisions be instinctive—not the result of checking whether someone senior is watching, but a reflection of genuinely internalised values.

This is why the single P&L across our practices has been important in ways that go beyond accounting. When every office is part of the same financial structure, the incentive for one office to cut corners—to take on work that the rest of the firm would decline, because the work is in that office’s market and its revenue impact is invisible to the centre—is significantly reduced. Shared economics create shared accountability. Fragmented economics, almost inevitably, create fragmented cultures.

The other mechanism is reputation indivisibility. I make this point to our partners regularly: if something goes wrong in our Singapore office, the firm’s reputation in Mumbai is affected. Not because clients will necessarily hear about it, but because we will know. And because the professionals in Mumbai will behave differently—more carefully, more rigorously—if they understand that the firm’s name is a single, undivided asset. Firms that treat international offices as separate ventures, to be assessed independently, produce exactly the quality inconsistency that clients notice and talk about.

ADAPTATION IS NOT THE SAME AS COMPROMISE

One of the practical questions that comes up in every market is how much to adapt. Local clients have preferences. Local professional norms differ. The pace of relationship-building, the formality of client communication, the acceptable scope of social interaction before business conversation begins—these vary meaningfully across cultures, and firms that ignore those differences come across as tone-deaf.

So adaptation is necessary. The question is what you are adapting and what you are not.

The things you adapt are operational: how you communicate, how you price engagements, how you structure the client relationship, how much flexibility you allow in payment terms, how you present technical advice in a way that is accessible to a client whose regulatory literacy is different from your home market. These are adjustments in method. They are entirely appropriate.

The things you do not adapt are standards: the rigour of the technical work, the honesty of the advice, the willingness to tell a client something inconvenient, the care taken in understanding a problem before proposing a solution. Firms that adapt on standards—that become more willing to cut corners, to give clients the answer they want rather than the answer that is correct, because local practice seems to permit it—are not adapting. They are diluting. And a diluted practice in one market will eventually infect the rest.

I have seen this happen with firms that entered markets with strong short-term commercial results and found, a few years later, that the quality of their work had degraded in ways they could not easily trace back to a single decision. The degradation was cumulative. Each small compromise seemed justifiable in context. Together, they had changed what kind of firm it was.

Preventing this requires a particular kind of clarity from firm leadership about what is non-negotiable. Not as an aspiration—everyone can articulate good values when asked—but as a practical behavioural commitment, demonstrated in specific decisions, especially costly ones.

WHAT GOING GLOBAL EXPOSES

Here is something that does not get said enough: globalisation is not just an expansion strategy. It is a diagnostic. And the diagnosis is often uncomfortable.

Domestic success in professional services is, to a significant extent, a function of structural advantages that have little to do with technical excellence. Incumbent relationships with clients who don’t change advisors often. Regulatory barriers that limit foreign competition in certain practice areas. Market sophistication that doesn’t always permit clients to distinguish between good advice and mediocre advice delivered confidently. These advantages are real and they are valuable—but they also create professional firms that believe themselves to be better than they are.

When you go international, those advantages disappear. The client owes you nothing. There is no switching inertia. The competition includes firms that have been building international practices for decades. And the sophisticated international client—the CFO of a multinational, the family office managing cross-border assets, the private equity fund navigating a multi-jurisdiction transaction—has typically worked with several firms and knows very well what good work looks like.

The firms that struggle internationally are usually not the ones that face an inhospitable market. They are the ones that, when they arrive in a new market, discover that the capabilities they thought they had are less developed than they believed. The talent they sent abroad is not quite ready for the environment. The quality frameworks they assumed were embedded turn out to have been enforced by proximity and supervision rather than internalised as habits. The partner-level judgment they trade on is available in only two or three individuals, rather than distributed across the practice.

Globalisation reveals all of that. And the right response is not to paper over the gaps—to make the international office look successful on the surface while the underlying problems remain—but to use the exposure as a genuine improvement mechanism. The firms that have built durable international practices are, almost without exception, firms that were honest with themselves about what they found when they looked.

THE LARGER OPPORTUNITY

I want to end with something that is more a matter of perspective than strategy.

The Indian professional services industry is at an unusual moment. The opportunities in India are significant and going global is not out of necessity but out of choice. The quality of the talent we produce is, as I said at the outset, genuinely exceptional. The client base we serve is becoming genuinely global. The regulatory environment is converging with international frameworks in ways that make cross-border expertise more valuable than it has ever been. And the competitive landscape—the question of which firms will define what a leading Indian-origin global practice looks like—is genuinely open. It has not been decided. The firms that will own that position in fifteen years are making the decisions that matter right now.

What I hope younger professionals and firm leaders take from this article is not a formula—there isn’t one—but a sense of what the work actually consists of. Building a firm that travels well is not primarily about geography or strategy. It is about people: finding them, developing them, retaining them by giving them something worth staying for. It is about leadership that is systematic and durable rather than personal and fragile. And it is about culture that is honest enough to be preserved in places where no one from the home office can see it.

A firm that gets those three things right will find that the markets are, in the end, receptive. Sophisticated clients everywhere are looking for the same thing: advisors who are genuinely excellent, genuinely honest, and genuinely invested in the client’s outcome. That is not a local proposition. It travels.

The question is not whether Indian firms will be present globally. They will be. The question is whether they will be there as leaders—firms that have built something of genuine institutional stature—or as participants. That choice is being made now, in the decisions that firm leaders are taking about talent, leadership, and culture. I hope more of them choose to build.

BCAJ Admin

India missed the chance to build a global accounting firm in 2002, but converging forces of technology, client fatigue, and regulatory shifts have reopened the window for a “Fifth Firm.” To succeed, Indian firms must evolve from fragmented, partner-led practices into unified institutions. This requires mastering complex regulatory dimensions across jurisdictions, maintaining strict audit independence, and managing cross-border conflicts. Firms must strategically separate regulated audit from non-regulated advisory services, embracing multidisciplinary structures and external capital to fund growth. Ultimately, Indian firms must view regulation not as a barrier, but as the foundational architecture of trust required for global scale.

1. INTRODUCTION – THE NEED FOR AN INDIAN FIRM WITH A GLOBAL PRESENCE

Some opportunities come once in a generation. They arrive quietly, without hype or hoopla, and leave just as quietly. You recognise them much later, when the world has moved on.

‘Professional Services’ had such a moment when a multinational firm collapsed. The crash opened the doors wide for a new entrant. For someone in India or the Global South. We didn’t seize the moment. We let it go uncashed.

In 2002, Arthur Andersen, the world’s top audit and accounting firm, went Kaput, courtesy of Enron, shredded documents, and broken trust. A once storied entity with over 80,000 professionals across more than 80 countries vanished overnight. The tsunami left many things under the debris, including hope, innocence, and trust.

The four remaining firms—Deloitte, PwC, EY, and KPMG—moved double fast. Within months, they absorbed Andersen’s people, practices, and clients. The Big Five became the Big Four. That moment was the crack through which an Indian firm could have emerged. A firm with different soil, different story, and different DNA. But it didn’t happen.

We lost the opportunity. Andersen disappeared, and the Big Four continued to party. The Fifth never showed up.

Now, in 2025, India has over 400,000 CAs. She is the headquarters for global back offices. She audits global subsidiaries. Her professionals speak the language of IFRS, ESG, and PE exits. Yet, India has not built a single professional services firm to match the Four.

This is the time to build The Fifth firm, in other words a large Indian firm with a global presence which could equal the Big Four at some point in time in the future. Thank fully the Government of India has embarked on the initiative of building more Indian firms to increase the options available in the market place.

AT ITS CORE, WHAT DOES THE FIFTH FIRM REPRESENT?

It represents a choice for clients seeking a longer shortlist. It represents the ability to interpret things through a dual lens, viz., global in structure, but local in insight. It represents the possibility of a world-class institution born not in Europe or America, but in Asia.

‘Professional Services’ remains perhaps the only trillion-dollar industry where four firms hold a vice-like grip. Here, market concentration is mistaken for competence. When clients select a Big Four, they believe they are managing risk. When ambitious talent joins them, they assume it is a shortcut to success.

Unfortunately, the brand has become a proxy for legitimacy. When clients choose a ‘Big Four’ firm they believe their actions would be justified as they have picked one of the best in the business in the belief that the world considers size as equivalent to capability and quality.

This has created a paradox: a high-trust industry with low innovation and zero institutional mobility. And India stays in the second tier. Not because it lacks capability, but because capability alone doesn’t build institutions. To scale globally, you need belief, which today is represented by brand, capital, governance, and an internal culture that can weather storms.

The globalisation of Indian accounting firms cannot be viewed merely as an exercise in opening offices abroad, joining international networks, or serving Indian clients in overseas markets. At its core, it requires the ability to operate within multiple regulatory systems, each with its own rules on licensing, audit eligibility, independence, confidentiality, data protection, quality review, disciplinary jurisdiction and ownership structures. A firm seeking to grow globally must therefore develop not only commercial ambition, but also regulatory awareness and an institutional ability to take considered positions on difficult questions before they arise in client situations.

That’s why dozens of mid-sized firms, some of which are technically excellent and trusted locally, have never crossed the line to achieve global relevance. Because the leap from regional to global isn’t about scale; it’s about design. It requires governance that clients can trust. It needs talent models that retain stars. It should have brand equity that signals both competence and confidence.

This is particularly important because accounting firms occupy a distinctive position in the economy. In advisory services, they compete like professional businesses. In audit and assurance, however, they perform a public-interest function. The audit opinion is relied upon not only by the client that pays the fee, but also by shareholders, lenders, regulators, employees and capital markets. Consequently, global accounting practices must reconcile two sometimes competing impulses: the commercial need to scale and the professional duty to remain independent, credible and ethically consistent.

For Indian firms, this balance will be central to global expansion. The firm of the future may combine audit, tax, transaction advisory, forensic, sustainability, technology and risk consulting services. It may work through Indian partnerships, LLPs, network arrangements, foreign affiliates, corporate entities for non-regulated services, or multi-disciplinary models. Each model creates opportunities, but also raises regulatory and ethical questions.

FOR DECADES, THE FIFTH FIRM FELT OUT OF REACH. BUT TODAY, THE GROUND IS MOVING.

First, there’s technology. AI and automation are transforming the face of delivery. Routine work, such as reporting, reconciliations, and document preparation, is getting commoditised. The traditional advantage of large firms, namely, their scale of delivery, is slipping. The differentiator is shifting from execution to interpretation, from templates to trust. And trust can’t be outsourced.

Second, regulators worldwide (from the UK’s Financial Reporting Council to India’s NFRA) are raising concerns about audit concentration and advisory conflicts. They’re looking for alternatives. The question now is “Why hasn’t someone else done it yet?”

Third, there’s client fatigue. After two decades of transformation programs, PowerPoint decks, and playbooks, clients are becoming less tolerant of generic value. They’re willing to work with smaller, smarter, and more contextually sharp partners—if they can trust them.

Fourth, talent is shifting. Young professionals today are not looking for ten-year ladders and corner-office titles. They want purpose and autonomy.

For the first time in decades, all four forces—technology, regulation, client sentiment, and talent mobility—are moving in the same direction. The forces reshaping this industry are already here. It depends on who steps forward and what they choose to build.

And the timing is not just right. It may be now or never.

2. THE INDIAN REGULATORY BASE: WHAT CAN TRAVEL AND WHAT CANNOT

Indian accounting firms begin their global journey from a regulatory base that is significantly shaped by the Chartered Accountants Act, 1949, the Chartered Accountants Regulations, 1988, the Code of Ethics issued by the ICAI, the Companies Act, 2013, and, for certain audit engagements, oversight by bodies such as the National Financial Reporting Authority. This base is not merely procedural. It determines who may practice, in what form, under what ethical obligations, and with what limitations on services.

A useful distinction must be drawn between regulated services and non-regulated services. Statutory audit, tax audit, certification and certain assurance functions are regulated professional services. They are typically required to be performed by members holding a certificate of practice, and the ability to sign reports is tied to professional registration and disciplinary control. In contrast, many non-assurance services—such as consulting, technology implementation, process transformation, transaction support, business advisory, risk management and outsourcing—may be capable of being delivered through other legal vehicles, subject of course to applicable laws and restrictions arising from independence or professional conduct rules.

This distinction is important for globalisation. If an Indian firm treats all services as though they must be delivered only through the traditional audit partnership model, it may constrain its ability to raise capital, hire non-CA professionals, build technology platforms and compete with integrated global firms. Conversely, if a firm treats all services as commercial services without recognising the regulated character of audit and assurance, it may compromise independence and invite regulatory action.

The corporate entity therefore has a legitimate role in the globalisation debate, particularly for non-regulated services. A limited liability company or other corporate structure may be appropriate for technology consulting, business process services, research support, data analytics, ESG advisory support, training, outsourcing or global capability services, provided it does not hold itself out as performing reserved professional functions and provided conflict, branding and independence issues are properly managed. The challenge is not whether corporate entities should exist around professional firms; they already do in many forms. The more important question is how the relationship between the regulated practice and the non-regulated entity should be governed.

Section 144 of the Companies Act, 2013 illustrates the issue sharply. It prohibits an auditor from rendering specified non-audit services to the audit client, its holding company or subsidiary company, including accounting and book-keeping, internal audit, design and implementation of financial information systems, actuarial services, investment advisory, investment banking, outsourced financial services and management services. The provision also expands “directly or indirectly” to include services through related entities or entities using the auditor’s name, trade mark or brand. This shows that merely shifting a prohibited service to a separate entity may not solve the problem if, in substance, the service remains connected with the auditor or its brand.

At the same time, the regulatory framework is slowly recognising the need for scale. It began with the setting up of LLP and now leading to allowing Multi Disciplinary Entities to be created. Additionally networks are being encouraged and the regulations around them are evolving despite the reluctance to open it up fully and jettison the past ‘controlled’ culture. Just as India opened up in the early 1990s the recent regulatory are welcome ‘green shoots’. These developments are important not because they immediately create global firms, but because they recognise that the traditional fragmented practice model needs institutional pathways for scale.

The Indian regulatory base, therefore, should not be seen as a barrier to globalisation. It is the starting architecture. But Indian firms must understand what part of that architecture is portable across borders and what part is jurisdiction-specific. The right to audit in India does not automatically create the right to audit in another country. Likewise, a network name may create market recognition, but it may also create independence, liability and quality-control expectations. For global practice, structure must follow regulation; it cannot be designed purely by reference to tax efficiency or branding convenience.

What the Big Four got right was that they built firms, not confederations of partners. In many professions, partnerships evolve into loose alliances of celebrities. There, clients belong to individuals, revenues are jealously guarded, and the firm exists as a shared letterhead. The Big Four resisted this movement, even at the cost of internal friction. They centralised brand ownership, partner admissions, and client acceptance norms. The logo did not belong to any one partner. The firm’s credibility no longer depended on a single individual.

The Key, therefore, is creating a model where no single firm, geography, individual or practice controls the firm. The model should facilitate regulatory compliance, balance risks, reward fairly and democratise decision making. One way of doing this is to form a non-practising entity which owns the brand, where leadership resides, where intangible assets are owned and licensed to individual entities in the network, cost are incurred for research and development, IT initiatives in each service line to develop new products and processes, manage the network through central policies, provide funding support to entities in need, etc.

In India, initially, this model feels unnatural. After all, Indian firms had been shaped by towering founders whose personal credibility carried client relationships. The Big Four model, by contrast, appeared impersonal. Partners rotate off marquee clients. Personal brands are deliberately submerged beneath a global identity.

This suppression of individual prominence allows for the emergence of continuity. Over time, clients will not leave when partners do. Relationships will outlive personalities. The firm, not the individual, will become the unit of trust. Single hero led firms will give way to numerous leaders with democratisation of ownership, decision making and choosing leaders with fixed terms through and unbiased merit based selection process.

All of this is possible within one network comprising of regulated and non-regulated entities with checks and balances to ensure that the regulated entities continue to comply with regulatory requirements.

3. INDEPENDENCE: THE NON-NEGOTIABLE CORE OF GLOBAL PRACTICE

Independence is the most sensitive regulatory issue in the globalisation of accounting firms. It is also the issue most likely to be misunderstood. Independence is not only a state of mind; it is also a matter of appearance. A firm may believe that its professional judgment is unaffected, but if the surrounding circumstances create a reasonable perception that the firm is financially dependent, commercially conflicted, or reviewing its own work, the independence concern remains.

The IESBA Code of Ethics has become an important global reference point. The 2024 IESBA Handbook includes revisions relating to the definition of public interest entity, including replacing the earlier “listed entity” category with the broader “publicly traded entity” concept for relevant provisions effective for audits of financial statements for periods beginning on or after 15 December 2024. (Ethics Board) The IESBA framework is based on identifying threats to compliance with fundamental principles and applying safeguards where available. However, for public interest entity audits, many non-assurance services are not merely subject to safeguards but are prohibited or tightly restricted.

Different jurisdictions apply independence requirements through different mechanisms. Some rely substantially on professional ethical codes; others combine professional codes with securities law, audit regulator rules, audit committee pre-approval and statutory prohibitions. A global Indian firm cannot rely only on Indian rules when servicing clients with overseas reporting, listing or audit requirements.

There are a number of case studies of actions against professional firms by regulators for breach of independence. The lesson is clear: independence is not managed only by engagement partners. It requires firm-wide systems, consultation protocols, technology-enabled tracking, training and accountability.

For Indian firms aspiring to operate globally, independence should be treated as a design principle. Before accepting a client or service, the firm must ask: Who is the audit client? Who are its affiliates? Which network firms serve the group? Are there financial interests, employment relationships, family relationships, fee dependence issues, self-review threats or advocacy threats? Is the service prohibited absolutely, permissible with safeguards, or permissible only after audit committee approval? These questions must be asked before commercial discussions have matured, not after the engagement letter is ready.

Large global networks manage independence by classifying their global client base into attest and non-attest clients. They monitor compliance through continuous monitoring through using technology besides cross border conflict checks and have a rigorous oversight over individual partner and professionals’ independence through compliance tools requiring disclosure of holdings and other interests of themselves and their family members.

4. NETWORKS, ALLIANCES AND THE PROBLEM OF SHARED IDENTITY

Networks and alliances are attractive pathways for Indian firms because they allow access to global referrals, methodologies, training, branding and cross-border execution without immediate merger into a single global partnership. However, networks create their own regulatory complexity. The larger the network, the greater the risk that one-member firm’s services may affect another member firm’s independence.

In audit regulation, the concept of a “network firm” is significant because independence concerns may extend beyond the signing firm. Under international independence standards, non-assurance services provided by a network firm to an audit client or its related entities may affect the independence of the audit firm. The IESBA Handbook specifically addresses communication with those charged with governance before a firm or network firm provides non-assurance services to entities within the corporate structure of a public interest entity audit client.

This is where many mid-sized firms underestimate the challenge. A network may be marketed as “independent member firms,” but from the client’s or regulator’s perspective, common branding, shared methodologies, referral arrangements, common quality standards and global pitches may create expectations of coordinated conduct. The phrase “independent member firm” cannot become a shield against poor coordination. If a network markets itself globally, it must also govern itself globally.

Indian firms joining networks must therefore examine the network agreement carefully. Questions of exclusivity, brand use, referral obligations, quality control, inspection rights, client acceptance procedures, independence databases, confidentiality obligations, dispute resolution and exit consequences are not merely legal drafting points. They determine whether the network is a real institutional platform or only a loose referral club. Globalisation through networks is viable, but only if the firm understands that shared identity brings shared risk.

5. CONFLICTS OF INTEREST: BEYOND INDEPENDENCE

Conflicts of interest are related to independence, but they are not identical. Independence is primarily associated with audit and assurance objectivity. Conflict of interest is broader. It can arise in advisory, tax, valuation, insolvency, transaction support, forensic, litigation support and consulting assignments, even where no audit relationship exists.

For example, a firm advising a buyer on due diligence may previously have advised the seller on tax structuring. A firm assisting a company in a regulatory investigation may also be advising a whistle-blower or a competing bidder in another jurisdiction. A firm providing transfer pricing advice to two companies in the same supply chain may be asked to support positions that are commercially adverse. A firm providing forensic support to a board committee may have earlier designed internal controls that are now under review. In each case, the question is not merely whether the firm can technically perform the work. The question is whether its objectivity, loyalty, confidentiality obligations or professional credibility are compromised.

Sometimes firms claim to have “Chinese Wall” between teams providing services to get around conflict of interest situations. This is a mere fig leaf and firms have to realise that even the legendary Great Wall of China was breached. In today’s highly connected world where physical locations don’t matter and the spread of communication in the digital world and social media are lightning swift “Chinese Wall” is illusory.

A global firm faces a higher conflict risk because client relationships are dispersed across offices, legal entities and practice lines. The tax team in one country may not know that the transaction team in another country is advising an adverse party. A consulting entity may not know that the audit practice has a relationship with the same group. Without a centralised conflict check process, the firm may discover the conflict only after it has received confidential information from both sides.

A practical conflict-check framework for global Indian firms should include the following:

The most important discipline is to define the “matter” correctly. A conflict check limited to client name may fail where the conflict is transaction-specific. Global firms therefore need databases that identify clients, related parties, beneficial owners, engagement types, industry restrictions, independence status, confidentiality restrictions and adverse parties. More importantly, they need a culture where partners accept that a lucrative engagement may have to be declined.

6. CONFIDENTIALITY AND INFORMATION BARRIERS

Confidentiality deserves separate treatment because it is not merely a subset of conflict of interest. Professional accountants receive sensitive information: financial statements before publication, tax positions, merger plans, pricing models, payroll data, board papers, litigation strategies, regulatory exposures, whistle-blower complaints and personal data. In cross-border practice, confidentiality risk increases because information may move across countries, cloud platforms, shared service centres, network firms and subcontractors.

The ethical duty of confidentiality requires firms not to disclose information acquired through professional relationships without proper authority, unless there is a legal or professional duty to disclose. But in a global firm, the practical question is: who within the firm should have access? The answer cannot be “everyone under the same brand.” Access must be need-based.

Information barriers should therefore be formal, not informal. Engagement teams should be ring-fenced where necessary. Data rooms should have role-based access. Internal emails should avoid unnecessary circulation. Shared drives should be controlled. Consultants and external experts should sign confidentiality undertakings. Cross-border transfer of data should be checked against applicable data protection law. Where the firm operates through a network, confidentiality obligations must be contractually imposed across member firms and subcontractors.

The growing use of artificial intelligence and analytics tools adds a further dimension. Firms must ensure that client data is not uploaded into tools in a manner that breaches contractual confidentiality, data protection obligations or regulatory expectations. A global Indian firm should have a clear AI-use policy covering approved tools, client consent, anonymisation, retention, access control and prohibition on training public models using confidential client data.

7. DATA PROTECTION: FROM BACK-OFFICE ISSUE TO BOARD-LEVEL RISK

Data protection is now a core regulatory issue for global accounting firms. Accounting firms process large volumes of personal data relating to employees, customers, vendors, investors and directors. They also handle sensitive financial and commercial data. When services are delivered across borders, personal data may be transferred between jurisdictions with different privacy standards.

Indian firms must consider India’s Digital Personal Data Protection Act, 2023, but global work may also trigger the EU GDPR, UK GDPR, Singapore PDPA, UAE data protection laws or sectoral confidentiality rules depending on the client, data subject, place of processing and contractual terms. A single global engagement may involve data collected in Europe, processed in India, reviewed by a team in Singapore and stored on servers of a cloud provider located elsewhere. The regulatory analysis cannot be left to the IT department alone.

From a governance perspective, every cross-border engagement should answer certain basic questions: What data will be accessed? Does it include personal data? Who is the controller or processor? Is there a data processing agreement? Is cross-border transfer permitted? What security standards apply? What is the retention period? What is the incident reporting protocol? Are subcontractors involved? Has the client consented to offshore processing?

Data protection also intersects with professional secrecy. A firm may be contractually permitted to process data but ethically required to restrict access. Conversely, a regulatory demand in one jurisdiction may conflict with confidentiality expectations in another. Global firms must therefore establish escalation mechanisms for regulatory notices, data breach incidents and client information requests.

8. AUDIT OVERSIGHT, INSPECTION AND PEER REVIEW

Global accounting practices operate in a world where audit quality is no longer left only to self-regulation. Public oversight bodies, audit regulators, peer review mechanisms and inspection programmes increasingly shape the credibility of firms.

Internationally, audit oversight is perceived to be more intrusive than in India though NFRA in its recent inspections and investigations has changed this perception. The PCAOB oversees audits of public companies and SEC-registered brokers and dealers, and its responsibilities include registration, inspection, standard-setting and enforcement. Singapore’s ACRA Practice Monitoring Programme assesses whether audits are performed in accordance with prescribed professional standards and other requirements. These regimes demonstrate that global audit practice requires readiness for external inspection, not merely internal confidence.

Indian firms that aspire to global work must therefore invest in quality management systems, methodology, engagement documentation, consultation processes, EQCR/EQR mechanisms, independence tracking, training records and archival discipline. The firm’s quality file must be capable of being reviewed by an external inspector who was not part of the engagement and may not share the firm’s informal understanding of the client.

Indian firms must adopt quality practices which compare with the best in the world. Quality has to be consistent across clients and geographies and not different for listed companies and private limited companies. Global practices must be embraced including acting swiftly and firmly on non-compliances.

9. DISCIPLINARY JURISDICTION AND CROSS-BORDER ACCOUNTABILITY

Globalisation complicates disciplinary jurisdiction. A partner may be registered in India, the client may be incorporated in Singapore, the parent may be listed in the United States, the work papers may be stored in India, and a network firm may have contributed specialist input from the United Kingdom. If something goes wrong, which regulator has jurisdiction?

The answer may be: more than one. Professional bodies may discipline their members. Audit regulators may sanction registered firms. Securities regulators may act where listed-company filings are affected. Courts may entertain civil claims. Data protection authorities may investigate breaches. Insolvency, anti-money laundering, sanctions and anti-corruption regulators may also become relevant depending on the assignment.

This creates a major governance issue for Indian firms. Engagement letters and network agreements must address governing law, liability, confidentiality, cooperation with regulators, ownership of work papers, document retention, subcontracting and responsibility for specialist work. However, contractual provisions cannot override statutory jurisdiction. A firm cannot contract out of disciplinary obligations.

For global practice, the safest approach is to assume that work may be reviewed by regulators beyond India if it feeds into an overseas audit, listing, transaction, tax filing, investigation or assurance report. Firms must therefore avoid the attitude that “the signing happens elsewhere, so our risk is limited.” Component work, offshore support and specialist memoranda can all become part of a regulatory record.

10. MULTI-DISCIPLINARY PRACTICE: OPPORTUNITY WITH ETHICAL BOUNDARIES

Multi-disciplinary practice is a natural response to modern client needs. Clients do not experience problems in professional silos. A cross-border acquisition may require financial due diligence, tax structuring, regulatory review, valuation, accounting advice, integration support, technology assessment, ESG review and internal control design. A firm that can bring multiple disciplines together has a commercial advantage.

The key regulatory question in MDP is control of professional judgment. Can non-audit professionals influence audit decisions? Are revenue targets creating pressure on assurance teams? Are consulting partners rewarded for selling services to audit clients? Is confidential audit information being used for advisory opportunities? Are clients being offered bundled services that impair independence? These are not theoretical issues; they are structural risks.

A well-designed MDP must therefore have ring-fenced audit governance, independent ethics oversight, service-line restrictions, clear profit-sharing rules, conflict checks, independence systems and disciplinary accountability. The firm must be able to demonstrate that multi-disciplinary capability enhances service quality without diluting professional independence.

11. EXTERNAL CAPITAL

The interest of private equity and other investors in accounting firms has increased globally, driven by the need for technology investment, succession planning, consolidation, growth capital and professionalisation of management. Accountancy Europe has noted that private equity and third-party ownership are reshaping the European accountancy and audit sector and has highlighted both opportunities and risks relating to quality, independence and governance. (Accountancy Europe)

For Indian firms, external capital raises difficult questions. Audit is a public-interest function. If investors seek short-term returns, cost rationalisation or aggressive cross-selling, there may be pressure on audit quality and independence. On the other hand, without capital, Indian firms may struggle to invest in technology, training, global infrastructure, cyber security, quality systems and international expansion. The policy issue is not whether capital is good or bad. The issue is what type of capital, in what entity, with what governance rights, and with what restrictions.

One possible approach is to distinguish between the regulated audit practice and non-regulated service platforms. External investment may be more feasible in technology, consulting, outsourcing, analytics or training entities, subject to safeguards that prevent interference with audit judgment, misuse of brand and independence violations. If external capital is ever permitted in regulated audit entities, it would require stringent restrictions on voting rights, profit rights, governance influence, exit arrangements, confidentiality, independence and regulator access.

This debate should not be postponed. Global competitors are already investing heavily in technology and multidisciplinary capability. Indian firms cannot become global institutions solely through partner capital if the scale of investment required is far beyond traditional practice economics. But capital must serve the profession; the profession cannot become captive to capital.

There are many who argue against private capital in regulated firms. In my view if in the medical profession doctors can continue to save lives and yet be accountable despite the ownership of their institutions by non-doctors there is not reason why professional firms cannot have private capital. The day is not far off when professional firms would be also listed in stock exchanges!

12. RECOGNITION, MOBILITY AND QUALIFICATION BARRIERS

Professional mobility is another critical dimension of globalisation. A chartered accountant qualified in India may be highly competent, but the right to sign audit reports, appear before regulators, undertake insolvency work or provide reserved services in another jurisdiction depends on local law. Mutual recognition arrangements, qualification pathways, local licensing and residency requirements can determine how far an Indian firm can globalise through its own professionals.

For Indian firms, mobility should be viewed at three levels. The first is people mobility: the ability of Indian professionals to work abroad, obtain local qualifications where needed, and participate in global engagements. The second is firm mobility: the ability of Indian firms to register, affiliate, merge or practise in foreign jurisdictions. The third is service mobility: the ability to provide cross-border services remotely without violating licensing rules in the destination jurisdiction.

Technology may make cross-border delivery easier, but it does not eliminate licensing restrictions. A team sitting in India may support a foreign audit, but the signing rights, review obligations and regulatory responsibility may remain with a locally registered auditor. Similarly, tax advice may cross into unauthorised practice of law in some jurisdictions if not structured properly. Global firms therefore need jurisdiction-wise service maps: what can be delivered from India, what requires local registration, what requires collaboration, and what cannot be done.

13. ETHICAL CONSISTENCY ACROSS JURISDICTIONS

A global Indian firm cannot operate with variable ethics—strict in one country, flexible in another. Regulatory requirements may differ, but the firm’s ethical floor must be consistent. Where local law is less stringent, the firm should still follow its internal global standard. Where local law is more stringent, the firm must comply with the higher standard.

Ethical consistency requires written policies, but it also requires leadership behaviour. Partners must see that independence breaches, confidentiality lapses, poor documentation and aggressive client acceptance are taken seriously. Staff must be trained to escalate concerns. Ethics partners must have authority. Commercial success must not become the only measure of performance.

The reputation of a global accounting firm is cumulative. A failure in one office can affect credibility elsewhere. This is especially true in the age of public enforcement orders, inspection reports, social media and cross-border regulatory cooperation. Indian firms aspiring to global stature must therefore build reputational resilience by investing in ethics before scale, not after scale.

14. CONCLUSION: REGULATION AS THE ARCHITECTURE OF TRUST

The globalisation of Indian accounting firms is both necessary and possible. Indian businesses are global, Indian professionals are capable, and Indian firms have the opportunity to build institutions that combine technical depth, cost competitiveness, cultural adaptability and entrepreneurial energy. But globalisation cannot be built on ambition alone.

The successful global Indian accounting firm will not be the one that merely has the most offices or the widest network. It will be the firm that understands regulated and non-regulated services clearly, manages independence before conflicts arise, separates confidentiality from convenience, treats data as a fiduciary responsibility, welcomes peer review and external inspection, builds systems for multi-jurisdictional compliance, and balances capital with professional control.

Policy support will be useful—particularly in areas such as regulatory harmonisation, recognition of qualifications, facilitation of firm aggregation, and clarity on permissible structures. But the primary responsibility will remain with firms themselves. They must build governance before growth, quality before branding, and trust before scale.

If Indian accounting firms are to move from domestic practices to global institutions, they must recognise a simple truth: regulation is not the enemy of globalisation. Properly understood, it is the architecture that makes global trust possible.

The decisive difference between the past and the present is this: hero partners are no longer enough. Cross-border reporting, ESG assurance, forensic analytics, and technology-enabled audit require systems, platforms, and capital investment in methodology and risk governance. These are baseline expectations.

In earlier decades, caution preserved stability. Today, excessive caution may lead to irrelevance.

The emergence of a Fifth Firm would not be to fight the Big Four. It would be a response to conditions that now make institutional scale feasible within India.

History reminds us that windows do not remain open indefinitely. Competitors respond. Markets consolidate. So, the question is no longer whether India has the conditions for scale. It is whether its professional institutions recognise that the ground beneath them has shifted.

BCAJ Admin

That the next big accounting firm should emerge from India is a laudable vision. The Global Networking Guidelines is a step in that direction but much more needs to be done in terms of reducing regulatory constraints and aligning Indian regulations with global norms. The Indian firms need to abandon their legacy mindset and work at building a recognizable brand. The landscape is strewn with firms that are small and fragmented and there is a crying need for consolidation, particularly amongst mid-sized firms to build scale. The vision cannot be achieved in one big leap but will be a long and arduous journey. It needs all stakeholders to work in sync and to have a radical shift of thinking both on part of the regulator and the Indian firms.

Truth can walk naked, but a lie always needs to be dressed. Khalil Gibran.

THE REALITY

The naked truth is that the Indian CA firms are nowhere close to challenging the dominance of the multi-national accounting firms (MNF) (also popularly known as the Big 4). Their combined revenues exceeded a staggering INR 45,000 crore in FY25¹, driven largely by growth in consulting and technology-led services. 67% of the Nifty 500² companies are audited by the Big 4, being the default preference due to their brand value.

So why are Indian firms not able to create their own brand and provide a strong and viable alternative to MNFs at least within India? After all the MNFs were established by recruiting Indian CAs who were then running their own professional practices. Even today these firms are managed and assignments are executed, predominantly by home grown CAs.

Statistics also show that more than 90% of India firms are “pop & mom shops” with 3 or less partners³. It seems Indian firms are unwilling to scale up as they are averse to sharing authority and are trappedin the illusion that being small ensures independence. They are also wedded to their name which prevents meaningful collaboration with other firms.

1 Big four's Indian arms outpace global counterparts in FY24 revenue growth | Company News - Business Standard

2 https://thefinancestory.com/audit-rotations-in-india-dominated-by-big-6

3 https://thefinancestory.com/mid-sized-indian-ca-firms-employing-20-percent-audit workforce

THE BIG (FOUR) MOMENT

But now there is a thrust from the Government and from ICAI encouraging the next large accounting firm to emerge from India. Many mid-sized Indian firms have also come of age and are looking at scaling up in India and globally.

It is indeed a great vision set for the Indian firms, but has the right framework been put in place where Indian firms can unleash their ambitions and capabilities and break the shackles that limits them to playing second fiddle.

The answer lies in reducing regulations and constraints and creating a level playing field where Indian firms can operate with greater freedom.

Often ICAI regulations are aimed at reigning in the MNFs, particularly those working through surrogate entities. But these very regulations also restrict Indian firms, perhaps more than they restrict the MNFs. We must accept that the MNFs are here to stay and have become an integral part of the Indian ecosystem. They have helped enhance service standards and professionalism, which in turn has benefited Indian firms. Today, advisory services are recognised, valued and are monetized, which was rare earlier.

History has shown that competition helps improve quality, which benefits both the clients and the CA firms. There can be no question that all firms including MNFs must function within the constraints of the ICAI regulations. But the solution is not to put in place stifling regulations but to look at international practices and ensure that regulations apply equally to all.

In most countries the regulations are much more liberal in terms of firm name, advertising, sponsorship, payment of referral fees, charging success fees in certain situations and so on. A more liberal approach with focus on creating a level playing field will benefit everyone. Indian firms are unable to flourish and expand globally as the ecosystem currently is holding them back. Rather than tinkering with current regulations with cosmetic changes, ICAI should consider completely overhauling its ICAI regulations and Code of Ethics even if it requires approval from the Parliament. With the Government supporting this initiative, now is the right time to push for big changes.

THE LONG ROAD AHEAD

It is important to remember that Indian firms cannot become global players overnight. The MNFs emerged through mergers and consolidation, and this process started in 1980s or even earlier. So, the vision of an India incubated MNF to fructify will be a long and arduous journey. The CA community, Government and ICAI will need to stay the course and act consistently with complete synchronization. Any contradictory messaging or constant change in policy will likely derail the process. Only if Indian firms are sure that the policy framework will be consistent would they be willing to invest funds and resources in major strategic decisions and initiatives.

MNFs grew through merger and consolidation and Indian firms aspiring to create a globally recognizable brand will have to follow that route and change their obsession of wanting to maintain their name or the illusory independence.

Indian firms cannot reach scale in one big leap and would have to take many small steps towards their goal. The first obvious step is to gain international exposure and imbibe the best practices followed around the world. ICAI must remove roadblocks to allow Indian firms to get that exposure.

GLOBAL NETWORKING GUIDELINES

ICAI has recently formulated the ICAI (Global Networking) Guidelines, 2025 where the preamble lays down the laudable objectives of exposing Indian firms to global best practices and to enhance their capacities and capabilities. The guidelines require the global Network to be registered with ICAI if any Indian firm or Indian Network is a constituent of such global Network.

The guidelines also encourage Indian firms to take the initiative and establish their own global network. However, this can be the ultimate goal and not the starting point. The obvious first step would be to become member of an existing international association/network and thereby build international experience and connections. This can be the steppingstone to finally going global.

The guidelines define Network as an arrangement, alliance, or association, drawn in writing, (irrespective of its nomenclature) formed with the objective aimed at any one or more of the following:

√ cost sharing amongst member firms;

√ Sharing common quality control / procedures

√ Sharing a common operational strategy;

√  Common brand name. initials, name or logo amongst the constituents;

√   Common website / domain name / email;

√ Common systems, partners and staff, technical resources, audit methodology, training courses, facilities

√  Any other circumstances wherein the actions of the constituents convey that they are associated in a way that constitutes a network.

The first 6 qualifying parameters for a Network have been adapted from the Handbook of the International Code of Ethics for Professional Accountants published by International Federation of Accountants (IFAC). The IFAC guidelines recognise the distinction between a Network (where there is much greater cohesion and at least one of the above six criteria are satisfied) and other Associations where firms come together on a common platform but maintain their own distinct and independent identity. Each member firm is free to develop its own brand and is totally independent of the Association or its other members. In fact, member firms may also compete amongst themselves and may have completely divergent growth and operational strategies. An Association is typically a membership model where none of the above-mentioned criteria are satisfied, and the purpose is to imbibe best practices and establish international connections.

So, Networks and Associations are fundamentally different, and it appears that ICAI wants only those alliances to be registered that satisfy the criteria of a network. This makes logical sense; however, it would be good if ICAI clarifies this explicitly to avoid any confusion. Appropriate safeguards can be put in place (if considered necessary by ICAI) to avoid misuse.

These guidelines are a welcome initiative as besides giving a framework to the Indian firms, it seeks to bring the MNFs within the regulatory framework. Unsurprisingly, due to the disclosure requirements, these guidelines have not been welcomed by the MNFs that function through multiple entities that are structured to stay outside the oversight of ICAI.

ALL MEMBERSHIPS ARE NOT NETWORKS

The guidelines clarify that when an Association is aimed at cooperation, by any means whatsoever, and there is cost sharing amongst the constituent entities, it is deemed to be a Network. However, the guidelines accept the proposition that all alliances or memberships are not networks required to be registered with ICAI. They specifically state that “the determination as to whether an Association is a Network shall be made as a person of ordinary prudence is likely to conclude under the given facts and circumstances…….”. It also clarifies that a larger structure aimed only at facilitating referral of work by itself would not constitute a network.

Take an example of a mid-size firm that already operates a domestic network registered with ICAI and has presence in various cities in India. Also, consider that such a firm also has presence outside India through entities under its direct control. Therefore, under the guidelines, the Indian firm would have to register this international presence as a global Network with ICAI. Let’s call this Network G1. Typically, the domestic network (registered with ICAI) would become part of G1, which in turn would also be registered with ICAI.

Further, assume that in consonance with the vision of the Indian Government and avowed objectives of ICAI, the Indian firm wants to further expand its footprints globally. With that in mind, it wants to stay connected with like-minded foreign firms and stay abreast of international practice. To achieve this long-term growth strategy, it would also like to be a member of an international association with member firms from more than 50 countries. The Indian firm is totally independent of this international association and its members and is pursuing its own global expansion strategy. There is no cooperation between the member firms with regards to strategy or operations or branding. Indeed, the membership of the global association is a steppingstone in the direction of ultimately establishing its direct presence outside India in many countries. Let’s call this membership to the International Association G2.

Surely, the Indian firm is not be expected to register G2 with ICAI. The Indian firm is just a member of this association and has no commonality with the other member firms as each of them function independently. Justifiably, G1 would be registered with ICAI as all the constituents cooperate and are working under a common brand with a unified operational strategy. G2 is a mere membership model and would not be required to be registered with ICAI as a network. The guidelines also support this view as the intention is to monitor Networks where there is commonality of objectives between member firms and at least one of the specified criteria is met.

ESTABLISHING PRESENCE IN A FOREIGN COUNTRY

The guidelines issued by ICAI would help and clearly come in play when an Indian firm wants to establish its global imprints.

An Indian firm could enter an existing network where all member firms closely cooperate and work with a common objective or may create its own separate network. In both cases, this would be a Network model (as envisaged in the guidelines issued by ICAI) that would have to be registered with ICAI. It could also consider establishing a branch or entering in partnership with an existing firm in a foreign country.

An Indian firm that wants to establish presence outside India directly under its control has its task cut out for it. It cannot enter in partnership with a local firm in that country unless all the partners of that firm are also qualified Indian CAs. The problem is that cross-nation partnership is not permitted by ICAI and by most jurisdictions. Therefore, partnership with locally qualified professionals who understand the terrain is not possible. ICAI (and most other countries) does not permit partnership with anyone who is not a member of ICAI.

Even if one finds a firm in another country where all partners hold the Indian COP the problem is not solved. Besides Indian qualification, the partners will also need to hold qualifications of that country so that it is eligible to sign audits and do attest functions under the regulations of that country. In most jurisdictions this would mean not just passing the relevant exam of that country but also serving the internship period there. This effectively means the person needs dual qualification and should have done dual internship in India and in that foreign country. Such an animal may not exist and hence it becomes mission impossible.

The Indian firm may consider setting a branch abroad and this under the ICAI regulations will require appointing an Indian CA to be in charge of that branch. Again, audit and attest functions may not be possible unless the gridlock mentioned above is broken. So most Indian firms that establish presence abroad render services other than attest functions.

The Global Networking guidelines enacted by ICAI are therefore a real and viable way forward. An Indian firm can enter into an arrangement with firms in a foreign country with partners holding qualification in that country. It would be a network arrangement with all firms under a common brand. This network would have to be registered with ICAI. So, this is a good starting point. However, taking a direct partnership interest in an entity abroad would not be possible as that entity may have persons qualified in that country but not holding an Indian COP. International co-operation and reciprocity is required between countries and their regulators for cross-border partnerships to become practically possible.

The other option would be to establish an entity that does not do any attest functions. This can even be a corporate entity, and the Indian firm or the partners of the Indian firm may invest in the share capital of that entity. Such arrangement would also have to be registered with ICAI as a global network.

So, it is not easy and the firms have to navigate a myriad of problems to establish presence outside India. The global networking guidelines provide some direction, but a lot more needs to be done. ICAI is well aware of the problems and will hopefully come out with more options and clarity by not just changing the Indian regulations but also working internationally for greater cooperation and reciprocity.

We are still at a stage where we are struggling to establish international presence. All stakeholders need to recognise that building an internationally recognizable brand is a long way off.

LEVEL PLAYING FIELD

Besides audits and attest functions, MNFs have grown in size and recognition due to their large consulting practice. They have managed conflict by creating multiple entities, some of which operate as surrogate entities outside the oversight of ICAI. It is essential to bring MNFs within the regulatory framework and the global networking guidelines are a step in that direction. This will, to an extent, provide level playing field within India.

All of us agree that the independence of the auditor cannot be compromised and conflict of interest must be avoided. However, the definition of a related party for determining conflict of interest is not consistent across regulations. It is imperative that there should not be any divergence between Company Law, SEBI, NAFRA and ICAI. There is need to lay down clear ground rules that apply and are enforced consistently for all CA firms, including MNFs.

MANAGING CONFLICT

ICAI has framed regulations which prohibit CA firms from taking up non-attest functions for certain Audit clients. There are stringent restrictions, but due to conflicting versions across different regulations there is confusion and lack of clarity. Surely, there should be one set of uniform guidelines. Secondly, such restrictions should not apply to unlisted SMES and other privately owned companies and the “one size fits all” approach needs a rethink. The smaller enterprises prefer getting all their services from a single service provider as this is a value proposition for them. Arguably, the advantage of relaxing these restrictions for small entities would far outweigh any risk of professional independence being compromised. In many jurisdictions smaller entities are exempted from Audit. In India also such exemption to small entities is under consideration through amendment to the Companies Act.

MULTI-DISCIPLINARY FIRMS

Multi-disciplinary firms are another initiative that needs to be fast tracked. Time is ripe for CAs to partner with other professionals, including technology experts, to enhance their service offerings. The idea has widespread acceptance, and it is time that it is operationalized so that CA firms leverage expertise of other domain experts.

Despite the clear advantages, conflict of regulatory jurisdiction (e.g. ICAI vs Bar Council) is a major roadblock. Who regulates whom if an MDF is charged with misconduct or professional violation could trigger jurisdictional nightmare. Strict restrictions on advertising and branding as well on raising capital through innovative funding methods is another damper.

CA firms doing audit functions are restricted from doing several non-attest functions and this is pushing firms from being either an all-audit firm or all consulting and non-attest firm. This means audit firm may not opt to partner with other professionals as each will restrict and may even cannibalize the other. On the other hand, CA firms not engaged in audit and attest functions are increasingly preferring to stay altogether outside the ambit of ICAI regulations.

So, there are legal amendments that would have to be formalized and harmonized across different disciplines if MDF is to become a reality. But even more important, the inherent contradiction will have to be acknowledged and bridged.

CONCLUSION

Indian CA firms have the quality and the capabilities to compete with MNFs, if they are unshackled from the constraints imposed on them and are provided a level playing field. In recent times, several mid-sized firms have emerged as a viable alternative to the MNFs. But the gap between them and the MNFs is huge in terms of size, scale and access to resources. These Indian firms must now go through a second renaissance of scaling up not incrementally but exponentially. Both organic and inorganic growth options need to be considered. In particular, they should consider further consolidation amongst themselves. After all the Big eight consolidated into the Big four.

Indian firms have an opportunity to realise their tryst with destiny. The atmosphere is conducive and time is ripe with the momentum set by the Government. However, I am sure even ICAI recognises that what has been done is just a beginning and the road is long and arduous with many hurdles to be crossed.

ICAI needs to look at the regulatory framework with a clean slate without carrying the legacy of the past. If Indian firms are to emerge as global players, then the Indian regulations must model itself based on global norms. If our regulations are more restrictive then we lose our competitive advantage. Indian firms cannot compete with their hands and feet tied up.

Similarly, partners of Indian firms have to get out of their narrow thinking of clinging to their name, which has no real brand value or unwillingness to let go of control.

If all stakeholders work in sync, the vision of the next big firm emerging from India need not be just the proverbial castle in the air. It can indeed be a dream that can be actualised.

BCAJ Admin

As Indian businesses expand internationally, globalisation is no longer merely an option for Indian accounting firms, but a strategic necessity. Currently, many firms remain focused on domestic compliance or act as mere back-office executioners for foreign networks. If they fail to adapt, they risk losing high-value clients, top talent, and market relevance. To survive, Indian firms must transition from individual, partner-led practices into unified, capability-led global institutions. This requires building strategic international alliances, investing in enterprise-grade technology, creating dedicated cross-border teams, and developing deep sector-specific expertise. Ultimately, firms must become trusted, globally connected advisors to accompany their clients’ international growth.

INTRODUCTION

क्षणे क्षणे यन्नवतामुपैति तदेव रूपं रमणीयतायाः।

That which attains newness every single moment, that alone is the form of true excellence.

Nothing could be more relevant than this from Shishupal Vadha in the context of Raivatak Mountain.

In this everchanging world, evolution and adaptation to change is the only constant. The globalisation of Indian accounting firms is no longer an aspirational conversation to be conducted at conferences; it is becoming a strategic necessity arising from the changing character of Indian business itself. For decades, a large part of the Indian accountancy profession grew around domestic compliance—statutory audit, tax audit, income-tax representation, company law compliance, indirect tax, exchange control filings and allied advisory. This domestic orientation served the profession well when Indian clients were largely domestic, capital was substantially local, regulatory exposure was mostly Indian and international work was either exceptional or routed through large multinational networks. That world has changed. Indian enterprises are acquiring companies abroad, raising foreign capital, setting up overseas subsidiaries, entering global supply chains, dealing with transfer pricing and Pillar Two-type tax developments, building global capability centres, and facing investors, lenders and regulators who expect advice that is integrated across jurisdictions. Therefore, the relevant question before mid-size Indian accounting firms is not whether they should become global in some abstract sense, but whether they can remain strategically relevant without building global capability.

EVER INCREASING PACE OF GLOBALISATION

India’s macroeconomic position provides the first and perhaps most compelling reason. India is projected to remain among the fastest-growing large economies, and several assessments place it on the path to becoming the third-largest economy around 2030, with S&P Global projecting annual growth of about 6.7% and India becoming the third-largest economy by fiscal 2030-31. With this scale comes a change in the nature of professional services demand. A larger economy does not merely produce larger domestic companies; it produces companies with global ambitions, international supply chains, cross-border financing requirements and multi-country regulatory exposure. India has also become a major destination for global capital.

The Chart below gives some idea about how cross border investments have grown in last 2 decades and where it is likely to go in next 5 – 7 years.

[Table created from data from DPIIT, RBI, UNCTAD and World Bank]

These numbers are not merely economic data; they are indicators of professional services opportunity. Every dollar of FDI / ODI creates advisory requirements around entry strategy, valuation, due diligence, tax structuring, FEMA compliance, transfer pricing, accounting, audit, reporting, governance and eventual exit. This does not only require knowledge of the domestic laws but also laws of other jurisdictions of either the investor / investee as the case may be.

This outward expansion changes the advisory landscape. A client that acquires a subsidiary in Europe, establishes a manufacturing operation in Vietnam, invests in a UAE holding company, sells SaaS products in the United States, or raises capital from Singapore does not need isolated Indian compliance advice. It needs a firm that can understand the commercial intent in India, coordinate local law, tax and accounting advice abroad, maintain consistency of positions, and take responsibility for the integrated outcome. If mid-size Indian firms cannot provide or organise such capability, the client relationship will naturally migrate to firms that can.

CHANGING CLIENT EXPECTATIONS

The profession of accountancy and related advisory services is very closely connected with the businesses and commercial entities. The profession has evolved with the changes occurring in business entities. In last few decades, the scope of services of an accounting firm has extended significantly. Due to offering of diverse services by the Indian Accounting Firms (IAFs), the expectation of the society from a CA Firm has also been ever expanding and they would consider an accounting firm which provides an entire catena of services to be more “evolved” as compared to a firm which restricts to certain areas of services.

Similarly, the international businesses have been eying fondly active investments in India. If India is not the most preferred investment destination, it is certainly one of the most preferred destinations. The sheer size of the domestic demand is attracting global companies for having more firm Indian presence.

A mid-market Indian company today may have export revenues, overseas warehouses, foreign subsidiaries, ESOPs for international employees, global investors, inter-company services, royalty payments, cloud-based digital operations, and permanent establishment risks in multiple countries. Even when the company is not large, the complexity of its footprint may be global. Further, even if an entity does not have such global reach, aspirational targets for all growing entities include the above. Such clients increasingly expect their trusted advisor to provide a single conversation across audit, tax, regulatory, valuation, transaction, ESG, technology risk and business advisory. They may not insist that every service be rendered by the same legal entity, but they do expect the Indian advisor to organise the solution, manage the interfaces and remain accountable. A single-location, single-speciality, single-jurisdiction practice therefore appears increasingly inadequate for growth-oriented clients. The relevant capability is not merely technical knowledge in one area, but the ability to assemble and govern a multi-disciplinary, multi-jurisdictional response.

With introduction of Transfer Pricing in India under the income tax laws, the IAFs could no longer provide complete tax service to a multi-national enterprise unless the IAFs had capability of transfer pricing advisory, document preparations (which was multi-disciplinary) and also knowledge about the transfer pricing regulations of the jurisdiction of the counter related party, as the policy and the transaction has to meet the regulations of both the countries. Those IAFs which could not cope with these requirements ultimately lost this work to the firms which could provide such services and in long term also impacted retention of such clients for the tax services.

Similarly, with introduction of IFRS, initially and then Ind AS, which were primarily adopted from the International Accounting Standards, several firms which could not cope with the complex requirements of these standards, lost out to the firms which could do so.

STATUS TODAY

There is almost negligible presence of IAFs in any major economies, save and except in some specialised jurisdiction like UAE, Singapore, etc. IAFs have somehow chosen to remain subservient as a service provider to international accounting firms without creating their own brand presence in any of the major jurisdictions. These outsourced service outfits are marketed on the principles of cost arbitrage, whereas the real arbitrage is exceptional intelligence that we IAFs possess in accounting, finance and tax related matters irrespective of the country and complexities. The question that arises is whether we are able to leverage the said capabilities in true sense or allow these capabilities to be leveraged by other firms.

What we have observed is that even attempts of the larger and mid-size IAFs have been to persuade ICAI to enable them to become members of some foreign networks / associations. Our aspirations are also not centred around creating a global branded capability of ourselves that is India centric, India focussed and India controlled. This would only make us subservient to the global players including networks / associations.

Due to our almost negligible presence in countries outside India, whenever a person needs services outside India, IAFs have to either rely on their associates outside India or let the client source services independently from their own sources. In this process, we may lose a client to multi-national accounting firms (MNFs), who are vying for such opportunities. Similarly, due to our absence outside India, when an entity outside India enters India for the first time, it has no background of the IAFs and therefore they by default fall in the hands of MNFs.

EMERGENCE OF GLOBAL CAPABILITY CENTRES (GCC)

One of the drivers for the need for changes in the service areas, is the transformation of India into a hub for global enterprise operations. The rise of global capability centres in India demonstrates both India’s professional talent advantage and the risk to Indian accounting firms if they remain positioned only as manpower providers. NASSCOM-Zinnov’s India GCC landscape report notes that India had over 1,700 GCCs in FY 2024, with more than 2,975 centres, estimated revenue of USD 64.6 billion and employment of over 1.9 million people; it further projects GCC revenue of around USD 100 billion by 2030 and headcount crossing 2.5 million. The significance of GCCs for accounting firms is twofold. On the positive side, they confirm the world’s trust in Indian talent, process discipline and cost-effective delivery. On the cautionary side, they show how Indian professionals may become embedded in global service delivery without Indian firms necessarily owning the brand, the client relationship or the intellectual property. If Indian accounting firms remain content with back-office execution for foreign networks, they may grow in headcount but not in institutional stature. The strategic challenge is to move from “delivery capacity” to “market-facing capability”. The move has been from Global Delivery Centre (GDC) to GCC.
Now we have to be the client facing capability created in India.

INCREASING COMPETITION FOR GLOBAL WORK IN INDIA

The competitive landscape reinforces the urgency. Multinational networks and global advisory firms have become more aggressive in India because India is both a high-growth market and a global delivery base. At the same time, global networks outside the Big Four and large consulting brands are strengthening their India presence through member firms, affiliates, alliances and specialist practices. The Indian deals market also reflects the increasing sophistication of business activity where each transaction generates work in diligence, tax, valuation, financial reporting, integration, controls and post-acquisition compliance. If Indian firms do not scale their capabilities, much of this work will be captured by larger networks, even when the client relationship originated locally.

RISKS FOR IAFs

There is, therefore, a serious strategic risk for domestically focused firms. The first risk is client leakage: the firm may retain routine compliance but lose strategic work. The second risk is talent leakage: ambitious professionals prefer platforms offering cross-border exposure, sector specialisation and technology-enabled work. The third risk is margin compression: domestic compliance work is increasingly standardised, automated and price-sensitive, whereas integrated advisory commands better economics. The fourth risk is brand stagnation: firms that do not invest in visible capability may become known for execution, not judgement. The fifth risk is dependency: Indian firms may become sub-contractors or resource pools for global networks rather than independent institutions with their own market identity. These risks do not arise suddenly; they accumulate gradually as clients outgrow the firm’s capability.

STRATEGIC GLOBAL CAPACITY CREATION

The answer, however, is not that every Indian mid-size firm must immediately open offices across continents or join a global network. Globalisation should not be confused with foreign addresses. The real strategic requirement is controlled access to global capability. A firm may build this through a combination of its own specialist teams, carefully chosen correspondent firms, bilateral alliances, referral arrangements, sector-focused collaborations and technology platforms. The essential point is that the Indian firm must remain the relationship owner and solution architect. It should not merely “refer” the client abroad and disappear. It should frame the issue, select the overseas advisor, coordinate advice, challenge assumptions, ensure Indian implications are considered, manage timelines, and present an integrated conclusion. This is the difference between being a local practitioner with contacts and being a globalising professional institution.

For practical implementation, mid-size firms should begin with a deliberate international strategy rather than opportunistic networking. Recommended steps could be as under:

1. The first step is to map the existing client base and identify global touchpoints: exports, imports, overseas subsidiaries, foreign investors, ECBs, ODI, transfer pricing, digital services, expatriate employees, cross-border M&A, and international tax exposures. This mapping will reveal which jurisdictions matter most—often the UAE, Singapore, the United States, the United Kingdom, the Netherlands, Mauritius, Japan, Germany and selected African or Southeast Asian markets.

2. The second step is to create internal service lines around recurring global needs: international tax, transfer pricing, FEMA and ODI advisory, cross-border transaction support, IFRS / Ind AS reporting, global mobility, ESG reporting and technology risk.

3. The third step is to identify reliable overseas firms in priority jurisdictions and convert informal relationships into documented working protocols covering response time, confidentiality, conflict checks, fee sharing, quality standards and client communication.

4. The fourth step is to invest in knowledge infrastructure. A globalising firm cannot depend entirely on individual memory or partner-level improvisation. It requires jurisdiction notes, checklists, standard engagement models, tax treaty summaries, transfer pricing documentation protocols, foreign subsidiary reporting calendars, and templates for cross-border diligence. These tools need not be elaborate at the beginning, but they must be systematic.

5. The fifth step is to create a cross-border desk within the firm, even if initially small, which acts as the coordinating point for international matters. Such a desk should not be a decorative label; it should maintain the alliance database, track assignments, update regulatory developments, coordinate webinars with foreign firms, and support partners in client conversations.

6. The sixth step is to develop talent differently. Global capability cannot be built only through senior partner relationships. Younger professionals must be trained in international tax concepts, IFRS, global audit methodologies, data analytics, business communication and project management. They should participate in joint assignments with overseas firms and, where feasible, undertake short secondments. The firm should encourage writing, speaking and thought leadership on cross-border issues because brand is built not only by doing work but by being seen as capable of doing it.

7. The seventh step is to choose sectors in which the firm can build differentiated credibility. For example, Indian firms can develop strong cross-border practices around pharmaceuticals, engineering goods, chemicals, IT/SaaS, renewable energy, financial services, family-owned multinational groups, start-ups expanding overseas, and inbound manufacturing. A sector lens allows a mid-size firm to compete on insight rather than size.

FINER ASPECTS FOR GLOBAL ACCEPTABILITY – TECHNOLOGY – CONFIDENTIALITY – BRANDING

Technology must be treated as infrastructure, not as an accessory. A firm that seeks to manage multi-jurisdictional work requires secure document management, workflow tools, knowledge repositories, data analytics, collaboration platforms and cyber controls. Global clients will increasingly ask how data is protected, how work is reviewed, how continuity is ensured, and how quality is monitored. The internationalisation of services also brings challenges of data privacy, confidentiality, sanctions screening, anti-money laundering sensitivity, independence conflicts and professional liability. Globalisation expands opportunity, but it also expands risk. Mid-size firms must therefore strengthen governance, risk acceptance procedures, engagement documentation, quality review and insurance arrangements before aggressively pursuing cross-border work.

A further strategic shift is required in branding. Indian accounting firms have historically underinvested in institutional brand building, partly because professional work was relationship-led and partly because regulatory culture discouraged overt marketing. However, brand building need not mean aggressive advertising. It means clarity of positioning, quality of publications, consistency of client experience, visible expertise, professional website content, participation in international forums, collaboration with chambers of commerce, and the ability to present credentials confidently. If Indian firms wish to become alternatives to multinational service providers, they must project themselves not as low-cost substitutes but as high-quality, India-rooted, globally connected advisors.

COLLABORATIONS AND NETWORKING

The profession must also recognise that independence and collaboration can coexist. Joining or setting up your own global network may be suitable for some firms. In fact, an Indian firm or group of firms, may consciously decide to either become member of (though not the best option) or set up a global network, which has scope for preserving strategic autonomy, avoid restrictive branding obligations, and work with best-fit firms across jurisdictions. What matters is not membership for its own sake, but capability, quality and control. A carefully curated independent alliance model may sometimes serve clients better than a passive network membership, provided the Indian firm invests in governance and relationship depth.

CONCLUSION

In conclusion, globalisation matters because Indian clients have globalised, capital has globalised, regulation has globalised, competition has globalised and talent aspirations have globalised. The accounting firm that remains purely domestic may continue to survive, but its ability to remain central to high-value client decisions will diminish. For mid-size Indian firms, the strategic imperative is to move from compliance-centric practices to capability-led institutions; from manpower supply to brand ownership; from referral dependence to coordinated global delivery; and from individual partner networks to firm-level international strategy. The opportunity is considerable. India has the talent, credibility, entrepreneurial energy and client base to create globally respected accounting and advisory institutions. The next phase will belong to firms that do not merely follow their clients abroad, but build the confidence, systems and alliances to accompany them as trusted global advisors.

BCAJ Admin