Chartered Accountant (CA) is the title used by members of certain professional accountancy associations in the British Commonwealth countries and Ireland. The term chartered comes from the Royal Charter granted to the world's first professional body of accountants upon their establishment in 1854.
Chartered Accountants work in all fields of business and finance. Some are engaged in public practice work, others work in the private sector and some are employed by government bodies.
In the UK, there are no licence requirements for individuals to describe themselves or to practice as accountants, but to use the description "Chartered Accountant" they must be members of one of the following organisations:
There is another accountancy body called The Association of Chartered Certified Accountants (ACCA), which has similar entitlements and responsibilities. Its members are Chartered Certified Accountants; the former name Certified Accountants is sometimes still used for brevity.
Each of these bodies admits members only after passing examinations and undergoing a period of relevant work experience. The ICAEW requires that students complete 15 examinations as well as 3240 hours of relevant work experience. Once admitted, members are expected to comply with ethical guidelines and gain appropriate continuing professional experience.
Chartered Accountants and Chartered Certified Accountants who engage in public practice work (i.e. selling services to the public rather than acting as an employee) must gain a "practising certificate" by meeting further requirements such as purchasing adequate insurance and undergoing regular inspections.
Chartered Accountants and ACCAs holding practising certificates may also become "Registered Auditors", providing they can demonstrate the necessary professional ability in that area. A Registered Auditor is able to perform statutory financial audits in accordance with the Companies Act 1985.
Further restrictions apply to accountants who carry out insolvency work.
The local title is however not available for use if the professional does not choose to join the local professional body. For example a holder of the French 'expert comptable' qualification could practise as an accountant in England without taking a local test but could only describe him/herself as "Expert Comptable (France)" not "Chartered Accountant". Within the EEA, only the UK and Ireland have bodies that issue the Chartered Accountant title.
There is also a mid-tier qualification called Associate Chartered Accountant with the designatory letters ACA. Associate Chartered Accountants are not eligible to hold a Certificate of Public Practice and therefore cannot offer services to the public.
Auditing rights are regulated by provincial governments. In British Columbia, the Business Corporations Act (which had replaced the longstanding Company Act) provides that only CAs, CGAs (Certified General Accountants), or anyone who has been granted an accounting licence by the provincial regulatory body may audit public companies. In Prince Edward Island, only qualified CAs and CGAs can perform public accounting and auditing in accordance with the Public Accounting and Auditing Act. In all other provinces, except Quebec and Ontario (detailed below), only qualified CAs, CGAs, and CMAs (Certified Management Accountants) may audit public companies.
Historically Quebec and Ontario only allowed CAs to audit public companies. However, CGAs and CMAs can audit a selected list of public bodies in Quebec. In 2004, the Ontario government passed legislation that would enable CAs, CGAs and CMAs to practice public accounting under a reconstituted Public Accountants Council. Only qualified CGAs, CMAs and CAs can be eligible for public accounting licenses.
In Quebec, the situation is currently under review and challenge based on the Agreement of Internal Trade (AIT). In August 2005, the AIT issued a report recommending Quebec to change its legislation by opening public auditing to qualified accountants who are not CAs.
The size of the accounting bodies varies across Canada. In Ontario and Quebec, CA is larger than CGA or CMA, however CGA is the fastest growing amongst the three bodies. In Manitoba and British Columbia, CGA is the largest accounting body.
Canadian Chartered Accountants use the designatory letters CA. However, a Canadian CA who is a member of a different institute/ordre to that of the province or territory in which he or she resides may face a restriction on using designatory letters in that province or territory. It is however normally straightforward to transfer membership from one provincial institute to another.
The Canadian CA is one of the few accounting destinations that can be transferred to an American CPA via a reciprocal-type exam.
A separate registration is needed for Chartered Accountants wishing to act as Auditors, namely RA (Registered Auditor). The RA Designation is controlled by IRBA (Independent Regulatory Board For Auditors), previously known as PAAB (Public Accountants and Auditors Board.).
A popular misconception exists that a Chartered Accountant may act as an Auditor. Since TOPP (Training Outside Public Practice) originated, a great number of members earned the designation Chartered Accountant with no knowledge or experience in Auditing. These Chartered Accountants specialise in financial management and almost exclusively act as financial directors or managers for large corporations.
To attain a CA(SA) qualification one must complete 3 years of pactical experience. One attains this experience by working for a registered training office. Article clerks who switch employers during this period are required to extend their training by 6 months.
After completing a relevant degree, normally a bachelors in accounting, and completing a CTA (Certificate for Theory in Accounting), part one (QE) and part two (PPE) of the qualifying exams must be completed before finally qualifying as a CA(SA).
A discussion forum for Chartered Accountancy (SA) assists anyone who has relevant questions to ask.
In India, the profession of chartered accountancy is regulated by the Institute of Chartered Accountants of India which was founded under the Chartered Accountants Act of 1949. The ICAI is responsible for examinations and licensing of it members. ICAI is the second largest body of Professional Accountants in the world with nearby 1,50,000 registered members.
Members are awarded the CA designation.
The Chartered Accountants Act, 1949 was passed on May 1. The term Chartered Accountant came to be used in place of Indian Registered Accountants. In this case, therefore, the term "Chartered" does not relate to a Royal Charter as in the case of the UK or Australia, as there is no Royal Charter in the Republic of India.
A person shall be awarded the CA after passing the relevant examinations and completion of three and a half years of articleship training (apprenticeship). This is to ensure that trainees have a mix of theoretical and practical training before they become members.
Statutory Audit under the Companies Act, 1956 and Tax Audit under the Income-Tax Act, 1961 can be carried out only by Chartered Accountants holding a Certificate of Practice.
The ICAI has also entered into Mutual Recognition Agreements with several overseas accounting bodies. e.g. the CECA with Singapore. The Institute is in process for opening up with various other countries and governments.
In view of globalization of the accountancy profession, the Institute is in the process of updating the Ordinance and Bye-Laws once again. Pakistan is also placed top 3rd chartered accountant awarding institute by IASB.
The head office of the Institute is in Clifton, Karachi in its own premises. The Institute also has regional offices at Lahore, Islamabad, Multan and Faisalabad. The ICAP is a member of the International Federation of Accountants (IFAC), International Accounting Standards Board (IASB), Confederation of Asian & Pacific Accountants (CAPA) and South Asian Federation of Accountants (SAFA).
Brief History of The Institute
The accountancy profession in this subcontinent originated with the concepts of limited liability and statutory audit which were introduced in the subcontinent with the promulgation of the Companies Acts in 1850 and 1857. However, the accountancy profession took some discernible shape in early part of the current century and in 1920 the Government of India formed an Indian Accountancy Board to advise the government on the conduct and development of this profession. The Auditor's Certificate Rules were published in 1932 whereby government authorities sought to regulate the accountancy profession.
When Pakistan came in existence in 1947, the 1932 Auditors Certificate Rules were adopted temporarily. In 1950 a new set of Auditor's Certificate Rules mainly based on the old rules, was published for regulating the profession in Pakistan. A person who satisfied the conditions laid down regarding practical training and theoretical knowledge could have his name placed on the register maintained by the Ministry of Commerce and was entitled to use the designation Registered Accountant". The Companies act in force allowed only a Registered Accountant to act as the auditor of a public company.
In 1952 the Registered Accountants formed a body known as the Pakistan Institute of Accountants to look after their interest and to take up with the Ministry of Commerce matters affecting the profession. The Government began to realize that the accountancy profession was growing in importance and in June 1959 the Department of Accountancy was set up in the Ministry of Commerce with a Controller of Accountancy to deal with the profession instead of a Section Officer. In 1961 The Institute of Chartered Accountants of Pakistan was formed as a statutory autonomous body.
As at March 2008 the number of persons registered as Chartered Accountants with the Institute were around 5,500.
Chartered Accountants in Sri Lanka belong to the Institute of Chartered Accountants of Sri Lanka and use the designatory letters ACA. Some senior members of the Institute may be elected Fellows and use the letters FCA.