New Delhi, March 14: A swadeshi- tinged chartered accountants’ organisation headed by RSS ideologue S. Gurmurthy wants the government to disallow foreign accountancy firms on Indian soil unless a regime based on reciprocity is put in place.
Swadeshi Jagaran Manch, which has a CA action committee for the creation of a level playing field, is holding conventions across the country to protest against the lopsided opening up of the sector to foreign players, especially allowing back-door entry.
However, the swadeshis are not alone. Sources say the Institute of Chartered Accountants of India (ICAI) has also submitted its stand on WTO negotiations recommending that foreign CA firms should be allowed to operate here only on a reciprocal basis. The issue is slated to be taken up during the WTO negotiations pertaining to GATS (general agreement on trade in services).
N. D. Gupta, former president of ICAI and chairman of its professional development committee, said the institute will try to ensure in the GATS that accountancy service is opened up only on a reciprocal basis and without visa regimes posing problems to the export of accounting and auditing services.
ICAI is also pursuing the issue of reciprocity individually with countries like the US, the UK, Australia and Canada. However, Gupta said he was sceptical of these countries allowing reciprocity on their own. None of the western countries, including the US, have opened up their accounting profession to foreign players, he said.
“The opening of the accountancy profession — particularly the consultancy services sector openly and audit services sector surreptitiously has resulted in unfair advantage to foreign CA firms in India,” said S. Gurumurty, co-convenor of the Swadeshi Jagaran Manch.
Both CA Act 1949 and CA regulations do not permit new CA membership to foreign nationals qualified from non-Indian institutions or even Indians qualified from non-Indian institutions.
Most of the international CA firms have come in either through the back door or have exploited some other loopholes in the system, said Gupta. “Ernst And Young operates by virtue of its tieup with S.R. Batliboi. KPMG has a FIPB clearance to establish a consultancy service only; if they do any audit work, they have to do through their tieup with Bharat S. Rout,” said Gupta.
Similarly, Deloitte Touche and Haskins is doing work under the names of Billimoria and Company, Hansodia & Company or Chowksi & company. The provision that CA firms have to be named on the names of their partners have not deterred foreign firms either as the Indian affiliates lend their names to carry out the practice.
“The non-level playing field has gravely affected the interests of Indian CA profession, an army of about one lakh globally competent professionals in danger of being marginalised in their own country,” said Gurumurthy.
Reciprocity of membership, will ensure that Indian CAs can work across the world, just as Indian software professionals do. Said Gupta, “Job proficiency and English language competence are the greatest assets of the Indian CAs.”