On its 71st birthday, the ICAI finds itself governing a profession at the crossroads

Anniversaries are a good time to take stock and look back on achievements. They’re also a time to look forward at emerging challenges and make course corrections to stay relevant. Today is Chartered Accountants Day and The Institute of Chartered Accountants of India (ICAI) celebrates 71 years of its existence. The ICAI has several things to be proud about. One of the earliest institutions of independent India created by an Act of Parliament, the ICAI has over the years produced outstanding professionals who have gone on to etch their names in the annals of the country’s economic and business history. The ICAI’s members are spread across countries, across industries and even across professions. Chartered accountants can be found not just in the mundane profession of accounting but in many unconnected ones such as politics, sports, entertainment, law and judiciary and the media. While these are things to be proud about there is a lot for the profession and the ICAI to introspect too.

The profession is at the proverbial crossroads now. The fundamental job of CAs — accounting and auditing — is now under threat from the onward march of technology. Machines and artificial intelligence (AI) can now do much of what CAs are trained to do. AI and data sciences, including mining and analytics, are a live threat to the science of auditing. With the current pace of advances in AI and data sciences, it is not difficult to foresee a day when they may replace the human mind in auditing. It is not for nothing that the Big Four audit firms are actively seeking and acquiring AI start-ups. The larger worry for the ICAI though is to keep the profession attractive among students who have multiple opportunities today. The institute has to make the course contemporary in terms of content that will prepare the students for multidisciplinary functions. The syllabus has to be overhauled to include cutting edge fields such as data sciences and AI on the one side and more sober disciplines such as risk management, forensic accounting, insolvency resolution and even investment banking. The new age CA should be trained in all these — accounting and auditing can be only one arrow in the quiver and not the only one.

The elephant in the room is the falling public esteem of the profession thanks to accounting and corporate scandals where auditors have been found wanting. No less a person than Prime Minister Narendra Modi, in a landmark address on CA Day in 2017, called upon the profession to “introspect and weed out corrupt practices and persons from their fraternity”. The National Financial Reporting Authority (NFRA) was created a few years ago as an answer to the complaints against the ICAI and it has taken over the regulatory role for auditors involved in the big companies. The ICAI has to quickly reorient itself to stay relevant.