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Bombay Chartered Accountants’ Society
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Thought Mailer Vol. 8 1 No. 09 1 April 2018
CA. P. N. Shah
RESPONSIBILITIES OF A TRUE PROFESSIONAL AND PROFESSIONAL BODIES
The users of professional services require an assurance that the members of any profession, be it legal, accounting, medical, engineering etc, whose services are retained, are persons of character and integrity as well as competent and knowledgeable to render such services. In order to provide this assurance the Professional Bodies, whether they are statutory or voluntary organisa-tions have to play a significant role and have great responsibility to the society. It is in this con-text that Parliament has enacted laws to set up statutory bodies like Institute of Chartered Ac-countants of India and similar Institutes for Company Secretaries, Cost Accountants, Indian Medical Council, Bar Council of Indian etc. The role and responsibilities of these Institutions are well defined in the respective statutes. They have to ensure that the education and training of students adequately match with the requirements of the society. They have also to maintain high standards of examination and ensure that proper professional opportunities are made avail-able to new members joining the profession. Further, these statutory bodies have to ensure that members of the profession maintain high standards of professional integrity and discipline in their life. That is the reason that the respective statutes give power to the councils of the statu-tory bodies to take disciplinary action against their members and to award punishment to erring members.
As compared to the above role of statutory bodies, voluntary professional organisations have to play a supporting role. No professional can remain static. He has to update his knowledge and skills by continuing education. He has to keep himself abreast with daily changing society and new developments. Commercial and other laws change frequently and courts pronounce judg-ments interpreting the complex laws. Voluntary professional organisations have a great role and responsibility in this field. They have to ensure that the professionals who have become their members are kept abreast of these new developments as well as new technology.
In this Thought Mailer some of the issues relating to responsibilities of a professional and of pro-fessional bodies are discussed in the context of current scenario.
PROFESSION V/S BUSINESS:
The essence of a profession is “Pride of service in preference to personal gain”. In contrast, a person engaged in a business may keep maximization of profits as his goal. In recent years, there are some professionals who try to carry on the profession as a business venture. There are others who are also tempted to convert the profession into business. If we examine the legal provisions governing various professions, we will notice that the emphasis in these provisions is that no professional should engage in any business if he is holding certificate of practice to prac-tice that profession. Such a professional cannot enter into partnership with any other person to carry on a business. When a person is carrying on a particular profession he has to observe high standards of integrity, objectivity, independence and confidentiality. In other words, he has to carry on his professional activities in a professional manner and not as a businessman. This is one area where the professional bodies can educate their members so that professionals are con-stantly reminded about their role in the profession.
As stated earlier, the members of the society would like to engage a professional who is a person of character and integrity. The character and integrity of a professional will depend on his per-sonal qualities. This will depend on the environment in which he is brought up, taken his educa-tion and training as well as his workplace. One may say that this depends on his SANSKAR. However, his character can be moulded by a professional body which can guide and encourage its members to live up to the high ethical standards in the profession. The prestige and confi-dence enjoyed by a professional depends to a great extent on the manner in which the proces-sional code is implemented by the professional body of which he is a member.
In this context what is necessary is to create a public image by the professional body that mem-bers of that professional body are competent, that they are keeping public interest above self-interest, that they are honest and that the erring members are awarded punishment expeditious-ly. To create this public image, the professional bodies have identified the following ethical standards by which every professional should conduct his professional and other dealings with others.
A professional should be straight forward, honest and sincere in rendering professional and other services.
A professional should be fair and should not allow personal prejudice or bias, conflict of interest or influence of others to overcome in the conduct of his professional or other activities.
Integrity and independence are the most essential characteristics of any professional. In dependence implies that the judgment of a professional is not subordinate to the wishes or direc-tions of another person who might have engaged him.
Information acquired in the course of his professional capacity has to be treated as most confidential. This should not be disclosed to anyone without specific authority of the client or unless it is required to be disclosed for compliance with legal or professional requirements.
(v) Technical Standards:
He must discharge his duties in accordance with the technical and professional standards relevant to the work assigned to him.
(vi) Professional Competence:
He must maintain high level of competence throughout his professional carrier. He should undertake only such work as he is competent to handle and complete within the given time frame.
(vii) Ethical Behavior
A professional should conduct himself in a manner consistent with the good reputation of the profession and refrain from any conduct which might bring discredit to the profession.
(viii) Conduct in other Fields:
A professional should maintain these high standards of integrity, objectivity independ-ence, confidentiality etc., even in his personal affairs.
For professionals in tax practice one of the voluntary professional bodies has formulated “Code of Ethics” to be followed by such professionals. It will be useful to refer to some of the con-tents of this code of Ethics which gives assurance to the society at large that professionals fol-lowing these guidelines can be relied upon.
A professional shall, at all times, conduct himself in a manner befitting his status as a privileged member of his profession and as a gentleman. He shall, at all times, in his dealings with the Court, Tax Officers, Departmental Representatives and clients act honourably and never in a manner which shows lack of honesty or probity. A professional shall fearlessly up-hold the interests of his clients and in his conduct conform to the rules in letter and in spirit.
(ii) Duty to the Court:
(a) A professional shall always conduct himself honourably and while pleading a case before a Court act with dignity and self-respect. He shall not be servile and whenever there is proper ground for serious complaint against a judicial officer, it shall be his duty and right to submit his grievance to proper authorities. (b) He shall maintain towards the Court a respectful attitude, bearing in mind that the dignity of the judicial office is essential for the survival of a free com-munity and the rendering of justice fearlessly. (c) He shall not influence the decision of a Court or any authority by any illegal or improper means. Private communications with the Court relat-ing to heard/pending matters are forbidden and (d) He shall use his best efforts to restrain and prevent his client from resorting to unfair practice or from doing anything in relation to the Court, opposing counsel or the Revenue which he himself ought not to do. He shall refuse to represent the client who indulges in such improper conduct.
(iii) Duty to the client:
(a) The professional is bound to accept any brief in the courts or Tribunals or before any other authority in or before which he professes to practice at a fee consistent with his standing in the profession and the nature of the case. Special circumstances may justify his refusal to accept a particular case. (b) He shall not ordinarily withdraw from engagements once accepted, without sufficient cause and unless reasonable and sufficient notice is given to the client about his with-drawal from a case. He shall, in that event, refund such part of the fees, if any, collected in ad-vance, as has not been earned. (c) It shall be his duty fearlessly to uphold the interest of his cli-ent by all fair and honourable means without regard to any unpleasant consequences to himself or any other, regardless of his personal opinion, bearing in mind that his loyalty is to the law which requires that no man should be made liable to pay tax levied on him without the authority of law. (d) He shall not charge a fee contingent on the result of litigation or agree to share the proceeds thereof. (e) He shall not do anything whereby he abuses or takes advantage of the con-fidence reposed in him by his client and (f) He should keep accounts of the clients’ money en-trusted to him, and the accounts should show amounts received from the clients or on his behalf and the expenses incurred for him.
(iv) General Conduct:
(a) A professional shall not solicit work or advertise either directly or indirectly, (b) He shall not offer private hospitality or favours of any kind to any judicial authority and (c) If any judi-cial authority is in any way related to him, he shall not appear before that judicial authority.
EDUCATION AND RESEARCH:
In modern times, no person, whether he is engaged in a profession or other occupation, can claim to be absolutely perfect. He has to continuously educate himself by updating his knowledge. For this purpose all professionals and others have to depend on the professional bodies who can impart this knowledge in the field in which that professional body operates. It is possible to impart such knowledge by organizing seminars, conferences, workshops, lecture meetings, residential courses, study circles etc., on topics of current interest. This is also possible by publication of books and other literature on current topics at periodical intervals at affordable cost. This will be a step in the direction of continuing education and training for professionals and others interested in the relevant topics.
Besides the above effort in imparting education and training to professionals and others the pro-fessional bodies have to continuously engage themselves in research on topics of interest to pro-fessionals to whom they serve. They have to be vigilant about the existing legislation and the amendments and also about new legislations which are introduced from time to time. They have to play a proactive role by approaching the authorities concerned with this legislation and per-suading them to take corrective steps so that complex legislation is simplified and the profes-sionals and others do not have to face hardship in their day to day life.
Further, the professional bodies have also to study the judicial pronouncements made by various courts and inform their members about the impact of such judgments on the relevant issues. If desired necessary, the professional body may also make representations to appropriate authori-ties for amendment of legislation.
It is also necessary that the professional bodies should look after the welfare of the professionals who are their members and others. It has a responsibility to the society at large. The basic needs of the underprivileged members of the society are Roti, Kapada, Makan, Education, Medicals Facilities and Employment. Lot of efforts are required to improve the quality of life of the common man. Our Government is allocating funds for the improvement of roads, houses, food, water supply, toilets, education, medical facilities etc., for the common man in villages and Ur-ban area. Sometimes we notice that the mechanism for implementing these schemes is faulty and no real benefit reaches to the deserving persons. It is in this field that professionals and professional bodies can play a useful role by suggesting better methods for implementation of these welfare schemes.
The cancer of corruption is all pervasive in our country. If those in charge of governance indulge in this illegal activity, those who are governed feel that they have no other option but to partici-pate in this activity even for getting legitimate things done. This has resulted in fall of moral standards in the society. The present Government appears to be determined to deal with this problem. It has taken some steps to curb this tendency. However, those engaged in the profes-sions such as legal, accounting, medical, education, engineering etc., and the professional bod-ies, whether statutory or voluntary, will have to take a lead and educate the people to resist par-ticipation in such illegal activity.
At one of the conferences organized by a professional body one of the Hon’ble Judges of the Supreme Court, in his inaugural address to professionals, referred to this topic of cancer of cor-ruption in the field of tax administration which is spreading in the vitals of our economy. In his speech he emphasized that cancer of corruption cannot be eradicated unless all professional or-ganizations declare a war against this evil. He urged upon all tax professionals and professional bodies to work towards eradication of this evil in these words-
(i) The associations and organizations of tax practitioners may refuse to recognize and sub-mit to the jurisdiction of corrupt officials. Social recognition acts as a stimulant and social boy-cott as a deterrent. The two are most powerful weapons of defense and offence which belong to Indian polity and are consistent with the principles of non violence taught by the Father of the Nation, Mahatma Gandhi. Associations and organizations must collectively but unostenta-tiously honour and recognize the honest and condemn the corrupt. The process may be slow but is evolutionary and is bound to have its curative effect. The honest and deserving must feel en-couraged; the dishonest and corrupt must feel marginalized.
(ii) The Conference of Tax Practitioners must conduct research and this should be an ongo-ing process and suggest how complexity of laws where the corruption breeds can be eradicated and the laws simplified.
(iii) The solution lies in fighting with the issues and marginalizing those who are trouble shooters. Not that all are corrupt and dishonest. The misfortune is that in spite of the honest being in plenty they are sidelines, lack recognition and are getting marginalized day in and day out. We have to reverse this process.”
In the context of present environment professional bodies can do no better than emulate the above message of this great professional who has set very high standards in the legal profession.
The above is an attempt to explain what are the responsibilities of a true professional and profes-sional bodies in the context of the present environment. When a person wants to choose his ca-reer and take a decision whether to join a profession or business, he should be ready to make a sacrifice if he selects to join a profession. In any profession the motto is pride of service in pref-erence to personal gain. Therefore, a professional has to keep upper most in his mind the fun-damental principles enunciated by professional bodies while performing his duties.
In order to meet the challenges that we face today the professional bodies will have to ensure that they conduct their affairs in the most transparent manner. They should ensure that persons who are in charge of the affairs of professional body are knowledgeable, competent and are able to devote sufficient time for the affairs of the professional body. Here are some of the sugges-tions which a professional body should consider and try to emulate in order to render better ser-vice to its members.
1. Recognize the changes in Economy / Business Environment such as focus on value, dynamic business and organization structures, developments in the Information Technology and Tele-communication, new Government policies, globalization of business and competitive pres-sures.
2. Recognize the path to success by adapting to the changes, knowledge management and ac-quiring skills to work with future environment influenced by technological and other chang-es.
3. Recognize the opportunities for professionals in the emerging areas of professional services, changed management services, strategy management, general practice specialization and serving global organizations.
4. Recognize the professional body’s role as a proactive, innovative and flexible organization, in equipping professionals with top quality education and values.
5. Recognize the need to be known as World Class Advisor.
About Us: CA. P. N. Shah
Mr. P.N. Shah is a Fellow Member of the ICAI. And he is practicing in Mumbai since 1950 and presently he is Partner, M/s Manubhai & Shah LLP and Shah & Associates, Chartered Account-ants of Mumbai. CA P.N. Shah is a past president of the institute (ICAI), South Asian Federa-tion of Accountants (SAFA), and Bombay Chartered Accountants’ Society (BCAS). He was also a chairman of Western India Regional Council of the Institute in the year 1965-66. He is a Trustee of BCAS Foundation, Mumbai and Natvarlal Shah Centenary Foundation, Ahmedabad. Shri P.N. Shah is also a director in many companies like Wolkem India Ltd. Garware Bestretch Ltd, Garware Healthcare Ltd. and many others.
He is a Joint Author of ‘History of Accountancy Profession in India (Vol. II)’, published by ICAI.
He is even a Joint Author of a book named, ‘Method of Accounting u/s 145 of I.T. Act – Accounting Standards applicable to Non-Corporate Entities’ and a BCAS publication named, ‘KarVivadSamadhan Scheme – 1998’.
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