In the distant past, I introduced the revolutionary concept of a "Family CA," drawing parallels to the trusted Family Doctor. Expanding upon this visionary idea, I am driven to delve deeper into its significance. The aftermath of the Covid-19 pandemic has witnessed an upsurge in financial losses. Amidst this landscape, I've encountered a multitude of distressing financial setbacks that individuals are grappling with:
- Deposits vanishing from cooperative societies or banks.
- Property transactions marred by fraudulent activities.
- Setbacks in the unpredictable stock market.
- Succumbing to online scams and schemes.
- Falling prey to hacking and online theft.
- Falling victim to financial deceit by unscrupulous entities.
- Enduring financial losses in various cash transactions, and more.
While I've highlighted seven instances, a broader spectrum of 15-20 scenarios exist, where a Chartered Accountant's (CA) expertise becomes paramount. However, the tendency is to restrict engagements with CAs to tax filings or attestations. The truth is that the more you tap into a CA's knowledge, the better prepared you become to avert financial losses.
Instead of relying on unverified advice from acquaintances, it's prudent to integrate CAs into your financial decision-making process. Even in situations devoid of tax implications, consulting a CA before financial steps can be invaluable. Regrettably, some individuals turn to CAs solely when tax issues emerge, often withholding essential details. This approach can lead to errors and ill-advised choices.
Becoming a Chartered Accountant in India is no mean feat, demanding dedication and skill to navigate the rigorous course. Practicing CAs often encounter financial scams more than others, giving them a unique ability to spot financial anomalies before they manifest to the general populace.
The Institute of Chartered Accountants of India (ICAI) has a motto that reads "Ya Aeshu Suptaeshu Jagruti" (Sanskrit:या एष सुप्तेषु जागति), which translates to "a person who is awake in those that sleep." This phrase originates from the Upanishads and was bestowed upon ICAI by Sri Aurobindo during its formation in 1949. It signifies that CAs remain vigilant and aware when others might lack insight.
The phrase "CAs are awaken when others are sleeping" signifies their perpetual state of awareness and knowledge, contrasting with the sleep referred to metaphorically - an individual’s dormant state of understanding.
Key Financial Domains and CAs' Role
1. Deposits and Investments
Cooperative bank scams amount to around ₹10,000 crore in losses every 5 years. CAs' acumen in economic conditions and current regulations positions them as ideal investment advisors. Consulting a knowledgeable CA prior to investing can facilitate SWOT analysis and informed decision-making.
2. Share Market Investments
Common individuals suffer losses of approximately ₹25,000 crore annually in the stock market. CAs' understanding of market behaviour surpasses even seasoned market advisors. Despite this, many dive into the stock market without CA guidance, resulting in substantial losses. In Bangalore alone, it is approximated that 1,000 salaried individuals incur about ₹10 lakh in losses annually. Relying on advice from colleagues or relatives often culminates in disappointment.
3. Real Estate Investments
Real estate losses tally ₹1 lakh crore every 3 years. Salaried and small investors often make ill-informed decisions guided by real estate agents, leading to illegal payments and property deals that burden them indefinitely. Consultation with reputable CAs before such transactions can avert financial catastrophe.
4. Personal and Business Loans
Roughly ₹5 lakh crore is lost annually due to imprudent loans. Eagerness among the middle-class populace leads them to procure loans from non-banking sources for various purposes, entailing exorbitant interest rates. This results from ill- advised counsel from friends and relatives. Connecting with CAs can prevent such misguided decisions and safeguard earnings.
5. Online Scams and Schemes
Online fraud accounts for approximately ₹1 billion in losses. Unintentional sharing of KYC and personal data while filing taxes or falling for fraudulent investment schemes results in credit card fraud, hacking, and other scams. CAs can provide timely advice to protect your finances.
Conclusion
A knowledgeable and ethical CA is an invaluable asset to society. He has the potential to prevent significant financial losses for friends, relatives, and clients by offering guidance before critical financial decisions are made. With their extensive research and exposure, CAs can foresee potential pitfalls and alert you to future losses, enabling timely action. They possess the ability to anticipate scams when others are chasing gains.
Consulting a CA prior to significant financial decisions, where the transaction value represents 5% or more of your annual income, is recommended. Eg -A person who earns Rs 20 lakh yearly, then any decision where spending or investing is more than Rs 1 lakh in one transaction or more than 1 transactions, is Financial Decision.
Maintaining a close and ongoing relationship with a knowledgeable and ethical CA is crucial to avoiding financial losses. Their insights could potentially save you from losses exceeding ₹10 lakh over a span of 15 years. If you've managed to avoid significant financial losses thus far, chances are you have a reliable CA by your side. A Family CA is new manthra of secured life from all financial losses. Make your CA as party or witness for all transactions to make your transaction is correct and error free. Presence of your family CA stops others giving wrong advises and stop them cheating you.
Please remember, while seeking guidance from a CA, it's advisable to compensate them for their expertise to encourage accountability and ensure a fruitful partnership. Free advice undermines the essence of the "Family CA" concept and might not yield effective results.
Embracing the concept of a "Family CA" could become the mantra for a secure financial life, shielding you from potential losses. Personally, I receive 3 to 5 calls weekly, and I'm gratified that my advice has annually saved a substantial sum within my circle.
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