CAs need to familiarise themselves with new areas of global accounting: FM Sitharaman

Finance Minister Nirmala Sitharaman

Finance Minister Nirmala Sitharaman on August 17 said that chartered accountants need to familiarise themselves with the new areas of accounting emerging globally which are becoming mandatory for companies to seek investments.

“There are newer areas in which chartered accountants will have to familiarise themselves with global developments. They will not just have to comply but also better advise their clients on new greenfield areas. These include carbon accounting, Corporate Social Responsibility (CSR) accounting and Environmental, Social, and Governance (ESG)-related expectations. Due diligence is so required on these by your clients for negotiating on transfer of technology, negotiating with partnerships and negotiating for funds,” she said.

Sitharaman was speaking at the Inaugural Session of National Chartered Accountants (CAs) Conference – ‘CAs Profession in Digital Era’ in Bhubaneswar.

“CAs need to be familiar with these new areas of accounting. They will have to set up best practices to make it a template for everyone to follow,” she said.

Emphasising on greater adoption of technology, the minister said that the CAs will need to nudge their clients towards it.
The government is active to ensure that chartered accountants have engagement with counterparts in other countries for more learning in these areas. The commerce ministry talks for a free trade agreement with the UK and various Memorandum of Understanding (MoUs) that are in the works should be leveraged for this by the CA community, she said.

Elaborating on how technology helps in all areas, she said it is its adoption that boosts greater productivity in manufacturing and services. Retail investors find fit to get into the stock market due to the digital revolution. When all the information is available digitally, it is then that people build trust in those companies. For a country to build an image for inviting foreign investment, information available digitally helps, Sitharaman said.

Financial literacy can be built easily with the digital revolution, she added.