Role of Chartered Accountants: Duties and Responsibilities

Former president Dr. APJ Abdul Kalam famously remarked chartered accountants (CAs) as partners in nation building. Indeed, CAs are an essential cog in the wheel of the country’s economy as their financial expertise come handy while formulating economic policies and analysing their potential outcomes.

Over the years, the responsibilities and role of chartered accountant have undergone a massive change and today their duties aren’t just confined to auditing and taxation. Read on to know the diverse roles of a modern-day CA.

1. Financial modelling

Financial modelling refers to the process of creating a summary of a firm’s earnings and expenses in form a spreadsheet that comes handy to analyse the impact of any future event or business decision. Note that financial modelling isn’t just restricted to creating a spreadsheet and making a forecast but also demands skills such as proficiency in Excel, visual basic for applications (VBA), valuation methodologies and ratio analysis among others.

Today, CAs are actively involved in financial modelling, helping companies in the country to get an accurate picture of their earnings and expenses to formulate better decisions. At the same time, learning the nuances of financial modelling help CAs to expand their venture and make strategic business decisions.

1. Risk assessment and management

For any business to thrive and mitigate frauds, it’s imperative for it to have a proper risk assessment and management system in place. India has witnessed numerous high-level financial frauds that have not only dented the image of the country but have also jeopardised the economy. The PNB fraud case, Saradha Group financial scandal and the Satyam scandal are some of the most high-profile financial scams the country has seen over the last few years.

Thus, today CAs working in tandem with top hierarchy of a firm to identify potential risks by closely monitoring financial records and policies along with writing and implementing risk management programmes. They are not only evaluating internal risks and but also external ones by keeping a close tab on the policies from regulatory bodies.

1. Forensic accounting

Forensic accounting combines financial accounting and investigative skills to identify irregularities which can impact civil or criminal cases. Through forensic accounting evidence of corruption, embezzlement and other financial crimes are sought. Due to poor corporate governance and mismanagement, there’s a growing need for CA firm having skilled CA professionals who are well-armed with techniques and skills to identify, discover and preserve evidence of every form of financial abuse.

Also, with an increasing number of lending institutions knocking the door of the National Company Law Tribunal for taking actions on defaulters with cases being filed under the insolvency law, there’s a demand for CAs specialising in forensic accounting. Additionally, local wings of enforcement agencies and regulatory bodies require forensic auditors in their efforts to crack down on shell companies and inside trading.

1. Wealth management and financial planning

While most people know the art of accumulating wealth, very few know how to manage it properly. Of late, a lot of CAs have ventured into wealth management and financial planning to help individuals realise their financial goals.

In fact, the Institute of Chartered Accountants of India (ICAI) offers a certificate course on wealth management and financial planning through which CAs learn and impart crucial lessons on the various aspects of goal-based investments to their clients. With Indian investors looking to invest in newer avenues like mutual funds and equities, apart from the traditional ones like gold and fixed deposits, the demand for CAs offering this service is likely to go up in the coming days.

Aditya Sehgal is a blogger and loves to write on various niches. He is known for his in-depth knowledge on topics such as technology, finance, lifestyle, current trends etc. Being a passionate writer he also contributes his knowledge on various blogs