The Evolution of Accountancy in India
Long ago, when our country was under the rule of the British East India Company, an act came into effect which stipulated several books that were required to be maintained by a registered company under The Companies Act, 1913. The requirement of an auditor was also there to maintain these books. The auditors needed a certificate from the local government to act as an auditor, as a basic qualification. The unrestricted certificate holder had the freedom to act as an auditor throughout the country, but a restricted certificate bearer could only act within the allotted province or language specified in the certificate.
The Introduction of the Government Diploma in Accounting (GDA)
In 1918, a diploma course started in Bombay, referred to as the Government Diploma in Accounting (GDA). In this diploma course, a desired candidate was required to undergo an articleship of three years and had to pass the examination; qualified candidates were rewarded with the unrestricted certificate. Afterwards, the issuance of restricted certificates was also ended in 1920.
Formation of the Register of Accountants
In the year 1930, after the Society of Auditors was founded in Madras, the government of India decided to keep records of members practicing as auditors. The mentioned record or register was called the Register of Accountants, and the person whose name was enlisted in the register was known as a Registered Accountant.
Establishment of the Indian Accountancy Board
Two years later, in 1932, an Accountancy board was developed called the Indian Accountancy Board to advise the Governor General in Council of India on the points of accountancy and the required conduct along with qualification standards of the auditors. The Indian Accountancy Board held its first examination in the year 1933, and GDAs were exempted from taking the test of auditors in the same year. Before the GDA was completely abolished in 1943, the first final examination of the auditors was conducted by the Accountancy Board.
The Formation of the Institute of Chartered Accountants of India (ICAI)
In independent India, a step was taken to form an expert committee that recommended starting an autonomous association of accountants to regulate the profession of auditors. The Government of India, after accepting the report of the expert committee, passed the Chartered Accountant Act in 1949 just before India became a Republic country. However, the Chartered Accountant Act came into effect on 1 July 1949, and the Institute of Chartered Accountants of India was introduced. According to section 3 of this act, the ICAI is founded as a body corporate with perpetual succession and a common seal.
The Controversy Over the Term "Chartered Accountant"
The term "Charter" from the professional designation, Chartered Accountant, is a controversial term because "Charter" refers to a royal charter in many countries. However, many titles were suggested at the time of passing the Chartered Accountant Act for the same profession in other countries, like Registered Accountants.
Simultaneously, many accountants have registered themselves as members of the Institute of Chartered Accountants in England & Wales and other societies of Chartered Accountants and continue to practice as Chartered Accountants. After much debate in the Indian Constituent Assembly, the term "Registered Accountants" was replaced with "Chartered Accountants" and came into effect on 1 July 1949, with 1st July celebrated as Chartered Accountants Day every year.
From India, Ahmadabad
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34Long ago, when our country was under the rule of the British East India Company, an act came into effect which stipulated several books that were required to be maintained by a registered company under The Companies Act, 1913. The requirement of an auditor was also there to maintain these books. The auditors needed a certificate from the local government to act as an auditor, as a basic qualification. The unrestricted certificate holder had the freedom to act as an auditor throughout the country, but a restricted certificate bearer could only act within the allotted province or language specified in the certificate.
The Introduction of the Government Diploma in Accounting (GDA)
In 1918, a diploma course started in Bombay, referred to as the Government Diploma in Accounting (GDA). In this diploma course, a desired candidate was required to undergo an articleship of three years and had to pass the examination; qualified candidates were rewarded with the unrestricted certificate. Afterwards, the issuance of restricted certificates was also ended in 1920.
Formation of the Register of Accountants
In the year 1930, after the Society of Auditors was founded in Madras, the government of India decided to keep records of members practicing as auditors. The mentioned record or register was called the Register of Accountants, and the person whose name was enlisted in the register was known as a Registered Accountant.
Establishment of the Indian Accountancy Board
Two years later, in 1932, an Accountancy board was developed called the Indian Accountancy Board to advise the Governor General in Council of India on the points of accountancy and the required conduct along with qualification standards of the auditors. The Indian Accountancy Board held its first examination in the year 1933, and GDAs were exempted from taking the test of auditors in the same year. Before the GDA was completely abolished in 1943, the first final examination of the auditors was conducted by the Accountancy Board.
The Formation of the Institute of Chartered Accountants of India (ICAI)
In independent India, a step was taken to form an expert committee that recommended starting an autonomous association of accountants to regulate the profession of auditors. The Government of India, after accepting the report of the expert committee, passed the Chartered Accountant Act in 1949 just before India became a Republic country. However, the Chartered Accountant Act came into effect on 1 July 1949, and the Institute of Chartered Accountants of India was introduced. According to section 3 of this act, the ICAI is founded as a body corporate with perpetual succession and a common seal.
The Controversy Over the Term "Chartered Accountant"
The term "Charter" from the professional designation, Chartered Accountant, is a controversial term because "Charter" refers to a royal charter in many countries. However, many titles were suggested at the time of passing the Chartered Accountant Act for the same profession in other countries, like Registered Accountants.
Simultaneously, many accountants have registered themselves as members of the Institute of Chartered Accountants in England & Wales and other societies of Chartered Accountants and continue to practice as Chartered Accountants. After much debate in the Indian Constituent Assembly, the term "Registered Accountants" was replaced with "Chartered Accountants" and came into effect on 1 July 1949, with 1st July celebrated as Chartered Accountants Day every year.
From India, Ahmadabad
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