Page 456 - CA Final PARAM Digital Book.

Second Schedule, Part II, Cl, 3 -- False Information to Council about Old Course-- (M16M, N17M,
QNO Article, where article was employed at company N18M, N19M)
769.000
TITANIUM CNO – PE.1660 / PE.1700
A Chartered Accountant in practice certified in requisite Form that an articled assistant was
undergoing training with him, whereas, he was also employed in a company between 10 a.m. and 6
p.m. on a monthly salary of Rs. 17,000 and attended the office of the Chartered Accountant thereafter
until 7 p.m. The Chartered Accountant pleaded that the articled assistant was on audit of the
company.
Answer Part I -- Relevant Standards & Laws
▪ As per Clause (1) of Part II of Second Schedule to the Chartered Accountants Act, 1949
Part II -- Requirements of Relevant Standards & Laws
➢ A member shall be held guilty of professional misconduct if he contravenes any of the provisions
of the Act or the regulations made thereunder, or any guidelines issued by the Council. The
chartered accountant, as per Regulations also, is expected to impart proper practical training.
Part III – Case Discussion
➢ A Chartered Accountant in practice certified that an articled assistant was undergoing training with
him, whereas, he was also employed in a company between 10 a.m. and 6 p.m. on a monthly
salary of Rs. 17,000 and attended the office of the Chartered Accountant thereafter until 7 p.m.
The Chartered Accountant pleaded that the articled assistant was on audit of the company.
Part IV – Conclusion
➢ In the instant case, the articled assistant is not attending office on timely basis and the explanation
of the Chartered Accountant that the articled assistant was on audit of the company cannot be
accepted particularly in view of the fact that articled assistant is getting monthly salary from that
company. The Chartered Accountant would be held guilty of professional misconduct in regard to
the discharge of his professional duties.
Author’s Note
Schedule II, Part II, Clause (3) shall also be mentioned as CA must have provided false information to the
institute regarding the office hours of article assistant.

Second Schedule, Part II, Cl,3 Included name of CA in Old Course-- (N07E, N08R, M11R, N13R, M16E,
QNO empanelment without his knowledge N16M, PM17, N18R, M18M, M20R)
770.000
TITANIUM CNO – PE.1700
AB & Co., a firm of Chartered Accountants, included the name of P as a partner while filing an application
for empanelment as auditor for Public Sector bank branches. It was subsequently noticed that on
the date of application, P was not a partner with AB & Co
Answer Part I -- Relevant Standards & Laws
▪ As per Clause (3) of Part II of Second Schedule to the Chartered Accountants Act, 1949
Part II -- Requirements of Relevant Standards & Laws
➢ A Chartered Accountant whether in practice or not is guilty of professional misconduct if he
includes in any information, statement, return or form to be submitted to the Institute, Council or
any of its committees, Directors (Discipline), Board of Discipline, Disciplinary Committee, Quality
Review Board or the Appellate Authority any particulars knowing them to be false.
Part III – Case Discussion
➢ In the instant case A B & Co. included another Chartered Accountant name as partner in his firm, in
his application for empanelment as Auditor of branches of Public Sector Banks submitted to the
Institute. In fact, such a member was not a partner of the said firm on the date of application.

Part IV – Conclusion
➢ He will be held guilty of professional misconduct.
Author’s Note
It’s a misconduct of second schedule part II clause 3 because empanelment for branch audits is
done by ICAI not individual banks. Application was made to ICAI. If false information is given in tender ,
empanelment to other parties then first schedule part III clause 3 would have been applicable.

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