Boom time for cost accountants

TNN 14 September 2009, 01:40pm IST

While the world of finance crumbled with recession, some professions within the sector witnessed a boom. The cost and works accountants (CWA) profession is one of them, claims GN Venkataraman, the newly appointed president of Institute of Cost and Works Accountants of India (ICWAI).

According to him, a cost accountant goes beyond books to analyse the actual cost involved in running a firm, manufacturing a product, and so on. "After the recession , there has been a marked increase in the salary of our final year students as compared to previous years," he says.

Over the years, CWA as a profession has been lagging behind as compared to chartered accountancy. Venkataraman feels that the reason for this is lack of regulatory support for the profession. "Since the time the institute was established under the act of parliament, there are only 44 products listed to be cost audited. In order to look into the matter and provide regulatory support, the ministry of corporate affairs (MCA) appointed an expert group last year. And that expert group has made 39 recommendations," he says.

As the new president, he says, it would be his priority to push for these recommendations. "Under these recommendations, ICWAI has also been asked to develop 20 standards for the profession. To date, we have developed six standards," he informs. The report has also recommended that regulators should move from a compliance oriented framework to a performance management framework with enterprise governance in mind. This shift becomes important in the context of the Satyam fraud, where the government hired a team of CWAs to investigate the fraud.

Talking about a future vision, Venkataraman says that he wants to increase the visibility of CWA as a profession, both nationally and internationally. "Nationally, I want CWAs to be at a level playing field with that of CAs. For this we have asked the government to recognize cost accountants under the definition of 'accountants' under Section 288 of the Income Tax Act. I feel we are equally qualified."

To get international visibility, the institute is pressing to get the name changed to the Institute of Cost and Management Accountant. "Globally, CWA professionals are known as cost and management accountants. In fact, the institute was also established by the members of Chartered Institute of Management Accountants (CIMA), UK," he says. Besides, he adds that the institute's efforts to develop standards for CWAs have been recognized by the International Federation of Accountants (IFAC), which is a global organization for the accountancy profession. We are trying to convince IFAC to adopt these standards. And in case this happens, members of IFAC would be adopting them, making India the first country to give accountancy standards to the world," he says.

When it comes to education, Venkataraman says that the institute has been updating its syllabus in keeping with industrial needs. It is for this reason that the institute is planning to introduce a course for specialization in valuation management.

Source: TIMES OF INDIA