THE days when accounting executives were prosaic professionals who went about their business with mechanical alacrity and measured humour are long gone. Accounting maestros now occupy centre-stage in an organisation, enjoy a glamorous image and are powerful figures in companies by virtue of their numerical skills.
But before you form a rosy picture in your mind, complete with impressive pay package, remember you have to clear the tough accountancy exams to pursue a career as a chartered or cost and works accountant. A good numerical ability, penchant for numbers and an analytical mind to interpret data affirms your aptitude for the profession. This combined with an ability to work on legal aspects in an administrative environment opens up the prospect of company secretaryship for you.
The reason for talking about these three professions in the same breath is that all three fall under the jurisdiction of the Ministry of Corporate Affairs. The bodies responsible for educating and training professionals in the respective fields are different, and work independent of each other. While a chartered accountant (CA) is trained by The Institute of Chartered Accountants of India (ICAI), a cost and works accountant (CWA) is a descendant of The Institute of Cost and Works Accountants of India (ICWAI). A separate statutory body, The Institute of Company Secretaries of India (ICSI), churns out company secretaries (CS). Of the three professions, the statutory powers enjoyed by a CA is much wider in scope than those of a CWA or CS.
Enrolments in Nutshell
If you are a 10+ 2 pass student, you are eligible for registering in any of the three courses. You also earn stipend, the amount of which depends on what the company chooses to give you. (See: Credit in Your Professional Account) In order to be member of ICAI, a student has to clear the Final Exam, complete three years of articled training and also undertake a 15-day general management and communication skills course. CWA is a multiple-entry course. A foundation level entrant may take a minimum of three years to complete the course if he clears the exam of each stage in one sitting.
Chartered accountants are sought-after professionals in specialised areas of accounting, auditing, corporate finance, corporate law and taxation. A CA also acts as a business advisor by preparing financial reports, helping the business to secure loans, preparing financial projections and determining business viability. As a tax advisor, a CA helps businesses and individuals to comply with tax laws.
As a CWA, you will maintain and scrutinise statutory books of accounts, prepare cash budgets, cash flow statements, do cost management planning and determine costing policy for companies, besides advising on investment and profit-planning. Good computing skills is a must for rendering services efficiently. ICWAI has more than 1,65,000 students and more than 40,000 qualified members who currently hold positions such as financial and business analysts, financial directors and consultants across sectors.
A CS is a vital link between the board of directors, shareholders and government and other agencies, with expertise in legal matters, securities law, capital market and corporate governance. They are responsible for all regulatory compliances of a company. All three professionals can choose to work for an organisation or practise independently.
The business of accounting, which remained cast in the traditional mould for decades, is witnessing a change in role responsibility quite rapidly. The traditional audit and tax functions are being widened, incorporating new services like business management consulting. The opportunities lie across sectors, as the finance department is the backbone of any organisation. A CA at the entry level can earn anywhere between Rs 30,000-35,000 a month. "There is a sustained demand for qualified, trained and experienced cost accountants in the fields of accounting and management functions," says Kunal Banerjee, President, ICWAI. A CS can begin his/ her career with a monthly remuneration starting from Rs 20,000 upwards.
Job prospects overseas are increasingly opening up. Recently, ICWAI and Chartered Institute of Management Accountants (CIMA), UK, entered into a Memorandum of Understanding, agreeing to recognise the professional qualifications of each other's alumni. CIMA has agreed to exempt 11 papers for successfull ICWAI candidates. Similar strategic partnerships have been signed by ICAI too, with professional bodies of UAE, UK, Singapore, Mauritius and Australia.
Hard work, dedication, speed, constant practice, robust communication skills and computer competency are some of the ingredients that help in clearing the tough examinations these courses entail. Many CA students pass the intermediate examination and complete articleship training, but do not become a member, ie a qualified CA, because they fail the final examination.To help recognise the hard work put in by students who fail to clear only the final hurdle, ICAI has started awarding them an Accounting Technician Certificate (ATC).
A similar course, Certificate in Accounting Technician (CAT), has been launched by ICWAI. The objective of ICWAI, however, was predominantly to address the shortfall of junior-level accountants. With increasing business activity, sectors like retail, BPO/ KPO and small and medium-sized enterprises need accountants to keep their day-to-day accounts. There is a huge dearth of junior-level accountants, maintains Banerjee. "The demand in that space is expected to be one million in another five years," he says. Small businesses are reluctant to employ even a fresh CA, whose minimum salary is upwards of 30,000 a month. "In fact, they don't even need a qualified, specialised cost accountant," says Banerjee. ICWAI started CAT in order to meet the demand in this segment. The year-long course, divided into foundation and competency levels, comprises examinations that include 60-hours of computer training, 6 months of practical training and 15 days of orientation training. "The beauty of CAT is it marries beautifully with the main professional course," says Banerjee.
This, that or the other?
You may chose to do one, or get qualified in all three courses, increasing your skill set base and gaining a huge competitive edge in the job market. If you are oriented towards audit, tax aspects and financial accounting, then opt for CA. CWA tackles study relating to cost and management accounting in great detail. Company secretaryship deals with legal aspects threadbare. The job prospects of being a CWA are not as varied as they are for a CA. A CA has the authority to verify and certify all accounts including the balance sheet of an organisation, unlike a CWA, whose expertise is limited to analysing and determining organisational and management costs. Though the role of CS can't be compared to that of accounting professionals, every organisation needs them for sound advice on corporate, legal, secretarial, administrative and even tax-related matters. Any company with an annual turnover above a certain limit is mandated to have one.
So, which qualification will you credit in your career plan sheet? Balance your interests and aptitude well!