Page 377 - CA Final Audit Titanium Full Book. (With Cover Pages)

CA Ravi Taori

FIRST SCHEDULE

PART I - Professional Misconduct in relation to Chartered Accountants in Practice
(CNO-PE.1020) CLAUSE 1 Bare Text:
A Chartered Accountant in practice is deemed to be guilty of professional misconduct if he:
Clause (1): allows any person to practice in his name as a chartered accountant unless such person is also a
chartered accountant in practice and is in partnership with or employed by him.
Rationale
Protection: The clause safeguards the public from unqualified accountants practicing under the guise of
qualified ones.
Qualification: The work of the accountant is ensured to be carried out by a Chartered Accountant.
Partnership or Employment: The Chartered Accountant carrying out the work should be a partner or an

employee

(CNO-PE.1040) CLAUSE 2 Bare Text: -
A Chartered Accountant in practice is deemed to be guilty of professional misconduct if he:
Clause (2): pays or allows or agrees to pay or allow, directly or indirectly, any share, commission or brokerage in
the fees or profits of his professional business, to any person other than a member of the Institute or a partner or
a retired partner or the legal representative of a deceased partner, or a member of any other professional body or
with such other persons having such qualification as may be prescribed, for the purpose of rendering such
professional services from time to time in or outside India.
CLAUSE 2 – Explanation
Prohibition: A chartered accountant in practice cannot pay or allow, directly or indirectly, any share,
commission, or brokerage in the fees or profits of their professional business to anyone who is not
(Partner Related Points)
a partner, a retired partner, the legal representative of a deceased partner,
(Member Related Points)
CA a member of the Institute, a member of prescribed professional body,
(Qualification Related Point)
or a person with prescribed qualifications.
Coverage of Service: For professional services, both within and outside India.
Partner: The term "partner" includes a person residing outside India with whom a chartered accountant in
practice has a partnership that does not violate Clause (4) of this Part.
Regulation 53A (1) List of Prescribed Indian Professional Bodies
The Institute of Cost & Works Accountants of India, established under the Cost & Works Accountants Act, 1959.
The Institute of Company Secretaries of India, established under the Company Secretaries Act, 1980.
The Bar Council of India, established under the Advocates Act, 1961.
The Institute of Actuaries of India, established under the Actuaries Act, 2006.
The Indian Institute of Architects, established under the Architects Act, 1972.
Regulation 53A (2) List of Foreign Professional Bodies
The membership of the professional bodies or institutions outside India recognised by the Council under sub-
section (2) of section 29. That means Foreign Professional Bodies with whom ICAI has MOU / MRAs
Regulation 53A (3) List of Qualifications
A person qualified as a Cost Accountant under the Cost and Works Accountants Act, 1959.
A person qualified as a Company Secretary under the Company Secretaries Act, 1980.
A person with a bachelor’s degree in law from a legally established university or recognized institution.

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