Letter to Chartered Accountants Institute

C N Venugopalan Ex- Manager, Union Bank of India & Financial Consultant	“ Nandanam” Kesari Junction North Paravoor Kerala – 683 513
Phone No. 0484 2447994 Mobile: 9447747994

The Director, 18^th October, 2006

Institute of Chartered Accountants of India,

ICAI Secretariat,

C-1 Sector –I, Noida – 201 301 Attn.: Mr. Vijai Kapoor

New Delhi

Dear Sir,

Significant Accounting Policies & Banks –

Publication of wrong working results

I had sent to you a letter dated 13^th May, 2006 on the captioned subject which the institute neither acknowledged nor replied in time. On enquiring the status of the letter, the CPIO of the institute informed me through his letter No. ICAI RTIA CPIO: 67:06 dated 13^th October, 2006 that it “has been responded vide Institute’s letter dated 11^th September, 2006 (Copy enclosed).” I had not at all received a letter bearing date 11^th September, 2006 from the institute till now. However, on going through the enclosure, I found a letter dated 11^th October, 2006 which bore no reference number at all. I have not received the original of the said letter, which appears as having been addressed to me. The institute has sent to me a copy of this letter even without my alleging its non receipt as if it was aware of the situation. The absence of any letter reference number in it also is intriguing. The letter No. CPIO 67:06 dated 13^th October, 2006 is seen dispatched swiftly by Speed Post on the very same day to me. As a safety measure and abundant precaution, you have stated in your letter sans any reference number that my letter dated 13^th May, 2006 has been received by you only on 6^th October, 2006 i.e. after a delay of about four months. The institute is in no way accountable to me and it was well entitled to return my letter in May, 2006 itself without sleeping over it, if the matter detailed in it was not pertinent to you. All the things taken together make the whole thing really enigmatic.

You have rightly stated in your letter that the Institute is a statutory body set up under an Act of the Parliament for regulating the profession of accountancy and it evolves guidelines and standards which are intimated to the members for observing compliance with the norms. The standards evolved are from the knowledge we acquire day by day. The norms prevalent some ten years back are replaced by fresh norms in keeping with time and requirements of the situation. It is the same belief that made me think that it would be worthwhile to bring to your notice the need for evolving fresh norms because of non-provision / non payment of establishment expenses that are contingent liabilities. Non-provision /non payment of Pension results in inflation of Profits as also conversion of establishment expenses into profits. Public also get deceived on account of the high stock prices prevailing in the market because of the inflated profits banks show in the financial statements. The situation has prevailed for last ten years or so. My sincere feeling was that the Institute would take up the matters with the Indian Banks Association and RBI, if not with Individual Banks.

Now I perceive that even statutory bodies are propelled by bureaucracy in our country and one has to be surprised only if the due sanctity is assigned to matters. Though the country is nearing the diamond jubilee year of independence, the citizens get justice and fair play only in their grave yard.

With regards,

Yours faithfully,

C N Venugopalan

cc.to: Dr. V. Seshadri, CPIO, ICAI, P B NO. 7100, Indraprastha Marg,

New Delhi – 110 002 for Information.