ICAI to revise audit fees, accounting standards

New Delhi, Aug 3: Changing with the times, the Institute of Chartered Accountants of India (ICAI) has revised fee charged for audit work carried out by chartered accountant firm in tune with the population of the cities where they practice.

The decisions relating to audit fee, accounting standards, and also the modalities for launching the new curriculum of the chartered accountancy course were taken by ICAI during its ongoing 261st meeting held here from August 1-3.

Regarding the revision of fees charged for the audit work being carried out by Chartered Accountant firms, it was decided that the fees charged will be in accordance with the population of the cities where they practice.

''The revised audit fee for a firm having 5-10 partners, practicing in a city having a population of 3 million and above, would now be Rs 6,000 while firms having more than 10 partners the fees would be Rs 12,000,'' ICAI President T N Manoharan told reporters here today.

In the case of cities having population less than 3 million, the revised audit fee would be increased to Rs 3,500 for firms having 5-10 partners. For firms having more than 10 partners the revised audit fee will be Rs 8,000. This condition will not apply to tax audit, VAT audit and audit under sales tax law.

Regarding the Accounting Standard (AS) 10, referred to as 'tangible fixed assets', Chairman of the Accounting Standards of the ICAI Mr S C Vasudeva, said now the international practice of depreciation, which is wide and complicated will be adopted. The practice has been adopted abroad, he said, adding that due to its intricate nature, it took two to three years to be fully operational in the European countries which have opted for this practice.

Once the revised AS 10 is issued, the Council will withdraw the existing AS 10 (dealing with accounting of tangible fixed assets) as well as AS 6 (dealing with depreciation), Mr Vasudeva said.

Also, in case of the Guidance Note on Reports in Company Prospectuses, the revised guidance notes provides detailed guidance to chartered accountants regarding reports and certificates issued about the prospectuses and other offer documents of the companies interested in issuing fresh equity stocks and listing on the stock exchange.

To make Indian chartered accountant globally competitive, a new subject dealing with the gamut of financial reporting especially corporate reporting is to be introduced, Mr Manoharan said. The new subject will focus on learning of IFRS based financial reporting and US GAAP based financial reporting in a bid to enlarge the scope of getting more outsourced work to India.

UNI