The profession at a crossroads - the way forward

Date
September - 2018
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The profession at a crossroads - the way forward
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                                                                                                                                                                                                                For Members only. For Private Circulation only.

Bombay Chartered Accountants’ Society

Harnessing Talent and Providing Quality Service

Thought Mailer                                                                       Vol. 9 1 No. 02 1 September 2018

Shri. Dinesh Kanabar

 

The profession at a crossroads - the way forward

We as professionals live in very interesting times. We have the legacy of some of the doyens who contributed immensely to the profession and have become the torch bearers for us all. At times, we find it difficult to live up to this legacy because we are an integral part of the society and the fabric of this society is itself changing. We cannot be an island as a profession, oblivious of the changing times. The approach of the society to morals, ethics, commitment, culture is changing, and that too rapidly. The expectation is that professional accountants will help promote growth and be conducive to it; something which runs counter to our role as auditors.

The profession itself has evolved a lot over a period of time. We have large multi-disciplinary firms practicing disciplines which are disparate and quite diverse. How does one relate to the practice of statutory audit to that of tax to that of HR consulting, IT consulting, project management and forensics? Within the umbrel-la of ‘accounting’ organisations, we have diverse professionals whose fundamental culture and ethos and approach to professionalism could be materially differ-ent from those traditionally practiced by Chartered Accountants. In the field of statutory audit, an area exclusively reserved for us, we have witnessed failures all around and there is an increased expectation gap between what the society expects us to deliver and what we profess to deliver.

Let us take a step back and see where we stand today and what challenges we face. The Prime Minister would like us to have home grown firms growing globally and breaking into the league of established large firms. Younger professionals entering the profession want diverse and quicker opportunities, the best in class compensation, faster growth, et al. On the other hand, technology is changing the entire approach to the fields reserved for the accountancy profession. Many es-tablished senior professionals have yet to come to grips with technology and are therefore grappling as to whether technology is a challenge or an opportuni-ty. The question we have to address is that how does the profession evolve in such a changing environment? I have penned down a few thoughts that will be criti-cal for us as a profession as we navigate through these challenges.

Institution building – This does not refer to mere size alone - after all growth for growth’s sake, will not get us anywhere. A transition will have to be made from highly individualistic practices to creating organizations that can invest in creating proper governance structures, grooming and training talent, and boosting the use of technology. Developing world class methodologies, best practices and robust internal processes will lead to building up the kind of institutions that can meet the requirements and aspirations of the coming generations of professionals, as well as tap opportunities coming out of rapid technological changes. After all, if technology is a bedrock of development and India is at the forefront of evolving technology, it is only natural that Indian firms should be at the forefront.

Boosting Quality – This is an area where I think our profession is on solid ground. The passion for self-improvement that is inherent amongst accountants can be easily leveraged to boost quality to truly world class standards. This will help us operate and make a mark at a global level. But there is still much to learn from the way the world’s leading accounting and law firms operate. Imbibing their best practices on training, learning and development and use of Artificial Intelli-gence will go a long way in boosting the overall quality of our practices.

A new approach – Lastly, and perhaps most importantly, there may be a need for us as professionals to rethink our role vis-à-vis our clients and society at large. With increased focus on the role of auditors and the quality of audits, and on tax evasion and avoidance, there is a need for us to recalibrate our education, our training and finally our approach to client service. It is of course a given that we must be well versed in the fine points of the law and rules. But is this enough?

There has always been, and I suspect will always be pressure on professionals from clients to come up with ‘solutions’ that will help them achieve certain objec-tives – be it in the presentation of financials or in the better management of their tax costs. But in an era where substance is increasingly relevant, both in finan-cial accounting as well as tax, a mere technical knowledge of rules may not be enough to safeguard a client’s interests. Regulators as well as the public at large, are looking beyond a mere compliance with the law, and are focusing on whether businesses and individuals have acted ‘appropriately’. A moral element, involv-ing fairness and adherence to the spirit and intent of the law, is now centre stage. And most importantly, the consequences of not meeting these standards are no less harsh than those that flow from a violation of black letter rules.

This brings in an element of subjectivity and requires adherence to unwritten ethical and professional standards on the part of professionals. No longer can we rely solely on the letter of the law, without considering its larger ramifications. This will be challenging, of course, and will require us to demonstrate much skill and judgment, in addition to our technical expertise. But this, more than anything else will be the key to our success as professionals in a changing world.

As a Chartered Accountant, all of us feel immensely proud of the fact that we have passed one of the most rigorous professional services examination. What we need to do is to use those learnings to reorient ourselves to the changing environment and emerge as one of the top professionals in the world.

About: Shri Dinesh Kanabar,

Mr. Dinesh Kanabar, CEO, Dhruva Advisors LLP is amongst the top tax advisors in India. Prior to founding Dhruva, he held a series of leadership positions across several large professional service organizations. Mr. Kanabar was a Deputy CEO of KPMG India where he played a key role in developing and implementing the firm’s overall strategy.

Besides, Mr. Dinesh Kanabar has also served as Chairman of KPMG’s tax practice. And prior to that he was the Deputy CEO of RSM & Co and subsequently led the tax and regulatory practice of Pricewater-houseCoopers (PwC) upon the merger of RSM & Co with PwC.

Mr. Kanabar is a member of the National Committee of FICCI and the Chairman of its Taxation Committee. He has worked with the Government on several policy committees, and was a member of the Rangachary Committee constituted by the Prime Minister of India to deal with tax reforms in the IT/ITES sector and for evolving Safe Harbour Rules

He can be contacted at : dinesh.kanabar@dhruvaadvisors.com

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