ICAI Eases Exclusivity Rules, Allows CAs for Dual COPs and Operates Mirror Firms in GIFT City
The Institute of Chartered Accountants of India (ICAI) has conferred official permission to Chartered Accountants (CAs) to set up minor companies in GIFT City. The aim is to ease the rule of exclusivity of the companies, generate employment opportunities at GIFT City and develop India as a global leader in accounting services.
The GIFT IFSC is being developed to see a large number of bookkeeping, accounting, taxation, and financial crime compliance services (BATF) firms coming in from the entire country. Till now, chartered accountants who were partners with a firm were not allowed to join any other company. The rule was made to prevent any one firm from having a monopoly over work related to the RBI and CAG. However, recently, ICAI said that creating a similar (mirror) firm in GIFT IFSC would not break the rule about keeping work exclusive within India.
ICAI has also granted CAs permission to retain two Certificates of Practice (COPs), one in their country, i.e., India and one abroad (countries like the UK, Australia, Canada, New Zealand, etc.), permitting them to work internationally.
The former president of ICAI, Aniket Talati, said, “Earlier, a CA could not join another CA firm to avoid losing out on RBI and CAG empanelment works. However, IFSCA has offered a new opportunity, and to ensure GIFT City emerges as a global financial services hub, this relaxation has been given. The ICAI is expected to announce the norms soon. If a CA firm with offices in other cities in India opens a mirror firm with similar partners, it will not lose exclusivity. This will enable CA firms from across the country to set up base at GIFT IFSC without losing out on domestic work.”
The ICAI’s present president, Charanjot Singh Nanda, said, “With our reforms, CAs can have two COPs now and provide outsourcing accounting services. The Indian economy is growing rapidly, and currently, we have around 4.50 lakh CAs. We believe the country will require around 30 lakh CAs by 2047. We have decided that a CA can have two COPs, also to ensure India becomes a global leader in accounting. Until now, a CA with a COP of India was not allowed to obtain a COP of another country. Now, we will allow COPs of countries like the UK, Australia, Canada and New Zealand, among some others.”
