Cost Audit Rights of ICMAP - Why ICAP is allowed?

[Ajnabi]

<b>(Please note that this topic is a continuation of "Is ICMAP bigger Than CIMA", at the following thread.
http//www.accountancy.com.pk/forum/topic.asp?TOPIC_ID=3002&whichpage=4)</b>

Kamran sab,

My statements have been misconstrued by you, as I, at the outset, in the first Para said that, “Chartered Accountants and Management/cost Accountants should never be compared with each other in such a way as has been done in the foregoing posts”, the above statement has not been intended with reference to Pakistan, rather, at International level, Management Accountants are recognized to tackle the problems with regard to Costing/management accountancy. Since Pakistan is an under developed / developing country, so the comparison, if specially made to well developed Economies like USA, Canada, UK etc., seems to be quite absurd. However, there should have a yardstick which should be used while comparison is made, for this purpose, I am of the view that Pakistan’s Economy should be compared with South Asian countries, who are similar to us as far as the economy is concerned, now as far as your question is concerned, first of all I would like to clarify that I am a Chartered Accountant, not within the meaning of Chartered Accountants Ordinance 1961, and a qualified Management Accountant, again not within the meaning of Cost and Management Accountants Act 1966, so my views should be tantamount to the views of a third party in the discussion being carried on, however I am quite aware of the two institute being discussed with reference to Pakistan.

As I already said that in Pakistan, Chartered Accountants are preferred in the field of even Cost Audit, which is the thing somewhat a mystery, since guidelines of cost audit have been issued by ICMAP then what factors should refrain ICMAP to have complete rights in the field of Cost Audit? Why Chartered Accountants are allowed in this regard? This is a flaw in our system in this regard, which is due to the strong position of some “Budhay” chartered accountants in national institutions like SECP and FBR etc.

Let me further clarify that, In India, only Cost and Management accountants (previously Cost and Works Accountants) are authorized to do cost audit, however, as per their Sec 233B (1) of Companies Act, 1956, Cost Audit is only to be conducted by a Cost and Management accountant, however if the Central Government is of opinion that sufficient number of cost accountants within the meaning of the Cost and Works Accountants Act, 1959 are not available for conducting the audit of the cost accounts of companies generally, then Government may, by notification in the Official Gazette, direct that, for such period as may be specified in the said notification, such Chartered Accountant within the meaning of the Chartered Accountants Act, 1949 may also conduct the audit of the cost accounts of companies.
Similarly, in Bangladesh, Company Act, 1994, Section 220 contains similar provisions as provided by the Indian company’s act 1956, i.e. the government of Bangladesh may, by order, direct an audit of cost accounts of the company be conducted by Cost and Management Accountants only.

Their Chartered Accountants, under no impression, have any authority to conduct audit of cost accounts.

Similar examples may be provided from other countries of the world that chartered accountants are limited to the financial audit only.

As far as Pakistan is concerned, CMAs, are under no case, less capable than CAs, the only difference is the mandatory training requirement, which makes CAs as a first choice while the audit is concerned, be it cost audit or financial, there are also some other reasons that is to say,

1- Lesser number of cost and management accountants firms.

2- Lesser number of professionals who have undergone the intensive practical training even at CA firms.

3- They are quite new in the field of audit as compare to ICAP as far as the practice is concerned.

4- Audit of cost accounts has been introduced through Companies (Audit of Cost Accounts) Rules, 1998, promulgated on 24th July, 1998, making Cost Audit mandatory for only two industries in the initial stage of its promulgation.

5- Actual purpose of CMA is to promote the profession of cost/management accountancy through its rigorous strategies in this regard, ICMAP was introduced to revive the sick industries in the country, by the name of Pakistan Institute of Industrial Accountants, PIIA, in its earlier stages, the actual purpose of whom was not to do Audit of either area.

Besides the aforementioned facts, number of many other factors may also be provided, if such need is arisen.

As far as your query with regard to curriculums of CA and CMA particular to Cost and Management Accounting and Auditing is concerned, please note that CMAs are also required to go through all auditing standards as CAs do, as far as the subjects of cost and management accountancy is concerned, CAs are required to take only two exams i.e. Cost Accounting & the other is Management Accounting, On the other hand CMAs are required to take four exams, i.e. Fundamentals of Cost and Management Accounting, Cost and Management Accounting Performance Appraisal, Management Accounting Decision Making and Management Accounting Business strategy. These four subjects of ICMAP cover as much as double the topics being taught in ICAP. I openly invite you to go through the curriculums of both of the institute in the subjects of Costing/Management Accounting. Only an illiterate or a person with lack of knowledge may be of the view that CA is tough education as compare to CMA, furthermore, ICAP has, in its current result, produced around 200 Chartered Accountants on the other hand ICMAP has produced only 10 Cost and Management Accountants throughout the country. I again invite you to check the current results of both the institute. On the grounds of these facts, why practicing CAs are given preference to audit? Why not practicing CMAs are preferred over practicing CAs? Kamran sab, the one and only answer is the Mandatory training requirement stipulated in ICAP’s studies and no other reasons exist.


I am quite sure that if few Non-Chartered Accountants, who have completed their articleship in a reputable firm, were allowed to start as practicing Chartered Accountants then they would do almost the same job, which is done by Professional Chartered Accountants, why this is so? this is just due to Practical Training of 3.5 - 5 years at a firm. So for the purpose of Audit, mere certificate of ICAP is not sufficient rather Intensive Practical training is necessary. Which, if stipulated for CMAs as mandatory requirement by way of its Act, then there would have no reason to consider ICMAP at par with ICAP.


However, I am quite hoped that in the second or third quartile of this decade, ICMAP will be the only person, who would do Cost Audit, provided that continuous efforts and strategies formulation process at ICMAP be continued in the same way.

I wish you all the best for your future.

[kamranACA]

Dear Ajnabi

It’s nice to find a new qualified member on the forum having vast understanding and exposure of various professional issues. This is what we need to promote and strengthen the forum as a best place and resource centre of information for upcoming students of accountancy.

Based upon a simple reading of your post I have drawn a picture that you did your CMA before getting your CA (from whatever institutes) done. I hope this picture would not be an illusion of my thought. Rest is known only to Allah.

You have attempted to present your case in a nice professional and informed manner. However, while going into details of what is being done at India or other places you simply forgot that the post which you were replying was written keeping in focus the ICMAP and not the other institutes. I agree that your main comments may not be Pakistan specific. However, if you have gone through the whole thread you might have seen my comments about CIMA as well which our all ICMAP brothers rejected altogether. {So, issue was not only with CAs, rather it lies some where else.} Yet, the blessing was to see you back on ICMAP and discussion on its merits and demerits in rest of the post. By the way some of the complaints like “budhay” chartered accounts etc are weird. I will explain you why it is weird.

It’s good to get inspiration and study various international models, yet the first step is to correct the basics and find out reasons which are creating obstacles for any one specifically. Rest assured I am not in favor of keeping any one out of the competition. However, I also hate to say that bala bala institutes member(s) created this situation for us using their position. It’s disgracing for a professional to say such words in my humble view. People are of course independent in their concepts.

Our brothers and elders who were and are ICMAP members are and were largely in public sector. You can check the figures that their number is greater than CAs in public sector and especially in the entities which can affect the governmental decisions. It has a reason; CAs rarely accept lesser routine pay-scales of public sector which one of our CMA brothers said are accepted by “their (CMA) members in the best interest of nation”. Exceptions can exist in every case and in recent past so many contract jobs were offered which carried good returns and were accepted by CAs for shorter tenures. Yet majority is of CMAs in public sector be it SECP (you have to see all the history), SBP, FBR, WAPDA, NSGPL, SSGC, State-Life, Railways, NLC or some other departments. How could have it happened that some “Budhay” CAs did not “permit” the majority of others that are largely in public sector to make out a valid case for their institute and members? Either such alleged “Budhays” were too concerned or too honest with their own co-members or inversely the members of the other institutes were totally unaware of the rights and needs of their institute and members. Kaisay ho gaya yeh sab?

It’s a strange question and a strange picture of the past. I hope you will try to find out what exactly has happened, what strengths were in place, what capabilities were developed, what resources were gathered, how efficiently practices were managed by the members of both of the institutes and how these practices emerged on the global scene when “others from international front” came in and evaluated the people and overwhelmingly offered their affiliations declaring the standards of practices fully conversant with their international level. So the need was to establish it locally, may be by idealizing some international model, and then asking the others that please come, check, evaluate and find out what strengths we have. A factual comparison will serve the purpose. Do you feel this all happened in a day or so? You will certainly be knowing that this might have also taken a significant amount of time as well. So, I hope your grouse with “Budhay CAs” will settle down slowly once you will listen the other side argument as well. After reading this very paragraph (which I know you are aware of at your own) would you also developing a feeling that some “Budhay chartered accountants” troubled the CMA brothers even in front of those international players? I believe your comments about those “Budhay CAs” have been developed without testing the exclamation that some CMAs oftenly make.

You have made out very logical points while pointing out ICMAP’s deficiencies on audit fronts. If you will go through the recent post of mine you will find some very real life issues which are in fact the problem areas and are not very much different from what you have evaluated. You identified following matters as major deficiencies in ICMAP members for getting into cost audit

- lack of practical training;

- lesser number of cost and management accountants firms;

- lesser number of professionals who have undergone the intensive practical training even at CA firms;

- they are quite new in the field of audit as compare to ICAP as far as the practice is concerned;

- audit of cost accounts has been introduced through Companies (Audit of Cost Accounts) Rules, 1998, promulgated on 24th July, 1998, making Cost Audit mandatory for only two industries in the initial stage;

- actual purpose of CMA “initially” was not to do Audit of either area; and

- others to be listed.

I hope you have gone through my recent post where I requested ICMAP brothers to concentrate on certain deficient areas if they wish to give a real competition in the market, instead of complaining against CAs who can of course perform much better than them for so many reasons. Reasons are identified and well know as Tariq Sohail said I have not pointed out any unknown factors. I hope I need not to again mention those reasons. Your above list indicates that you are well aware of those points as well.

I would like to comment on your remarks regarding syllabus and exam results as well. I requested you to throw some light on the grounds (certainly Pakistan specific) on which you named certain papers of ICMAP with the remarks that “These four subjects of ICMAP cover as much as double the topics being taught in ICAP”. I wish you have made these remarks without going into detail of the curriculum. Why you did not feel (as a third party) that ICMAP might have a need to restructure its syllabus contents and approach, if required. Do you think repetition and breaking down same things in four books serve some better purpose? If not required to do so in your opinion, have you really went through each component of such so-called four subjects? Have you checked how papers are structured and have you compared the contents with ICAP syllabus as well as papers? Let me find some time, I will come back to you with clear results as this post and time consumed both are on higher side.

You made me laugh while analyzing the results of ICMAP with CAs. Both institutes have publicly declared 50% as passing marks. Let me tell you with fullest affirmation that the ICAP results are always as per this marking. (I feel ICMAP will also be following the declared criteria being a professional institute). I am not telling this without exact knowledge that ICAP never sets aside this criterion. In any given examination the result will be dependent upon the facts like which students are taking it and how good the given student mix polished itself to face the test of knowledge. This mix can always vary from attempt to attempt. Without checking how many students appeared in exams, how much efficient they were and how were the papers structured and such other factors, we cannot comment on any result simply on the basis of rough or prejudiced assumptions. For so many reasons I cannot believe that any result is designed for market based or other reasons at least by ICAP and to some ones surprise this has been proved this time as well for which there is no reason but a better performance. I hope you will understand it.

I acknowledge that your comments that CMAs are the only option for Cost audit were not Pakistan specific since these cannot be at all.

I discussed with you basic two ingredients of making out a quality professional. You have admitted that the second ingredient is mostly missing in CMAs (Pak). Let me know please that how a CMA can learn auditing without training? Is it possible? I wonder if it is a small issue as your post reflects that it is the “only issue”. Even if we believe that curriculum is not an issue, the biggest factor and one major pillar of the building on which quality of a professional stands is gravely missing from the required attributes. Training does not only let the learner know how to apply any theoretically learnt technique. Rather, it is fundamental to develop the understanding about the costing systems, methodologies, SOPs, documentation, controls, design and flows in variety of industrial or services sectors and organization. Without undergoing a comprehensive training programme and claiming to be a best Cost Auditor is nothing but like throwing out of a layman from the aero-plane with a parachute from the height of 10 kilometers. I wonder if any syllabus book will tell how to learn verifying, preparing, designing or analyzing the costing records of Textiles, Sugar, Oil and Ghee, Cement, Power (on whatever fuel it is) or any other sector where costing is a prime function. I am not discussing the petty issues. Without learning it practically renders no difference between a professional qualification and an academic qualification. Had it been not important, you could have produced doctors, surgeons, engineers, pilots, atomic and other scientists, chartered accountants and cost and management accountants etc. Since you cannot do so without this, it have the vital importance. So, dear it is not “training only”; rather it is the one most important attribute that makes out a quality specialist. If this is missing, so much is missing and the result of discussion is obvious.

Now summing up the whole discussion, let me again tell you that I have no issues with CMAs and would love to see them in competition since such competition always contributes in development of better ideas, services and approaches. After all they are our brothers. (I myself at some point of time in life was also considering getting into CMA as my career building qualification.) Yet, I am very much certain on why CMAs (Pak specific) are lacking audit and professional exposure and I believe you have also rightly pointed out the grey areas as well. They need to concentrate more on professional side that is even important than the academic and syllabus issues for making a place in the market. This is what market drives.

If they don’t have good firms having required strengths, number of qualified and support staff, logistical facilities; and if they don’t have practical training arrangements through which they can learn how to apply theoretical knowledge, standardized audit procedures and documentation, internal and external quality assurance system and ability to serve the needs of clients (not for the reason that they are not efficient, rather they are not geared to do it and they don’t have resources to do it) and so forth and so on, then they must have to do the needful. This is in their own best interest. There is no “Budha” CA hindering in doing this all. I hope you will appreciate this fact.

I hope no CMA will take this post as irrelevant or biased or allergic. This is what they need and this is what where a focus is required.

I, however, request that don’t transfer your burden to the shoulders of others merely by alleging weird things. This we should not do. Constructive discussion and sharing of ideas should be appreciated.

At the end, I thank you for introducing yourself and would request you to keep posting on the forum. People like you can guide better to the students for the common well-being and to encourage sharing of the knowledge and exposure.

Regards,


KAMRAN.

[Ajnabi]

Kamran sab,
I appreciate your time devotion, however, i am urgently required to attend a meeting, for which i will be out of country for 2 days.
Probably, i would reply you on Monday or Tuesday, untill then, i hope you would complete your search, for which you asked to do so.

In the end, it would be quite difficult for me to continue contribution at this forum in a long run.
I hope you understand.

Have a good day.

[awaisaftab]

Before making any comparison of CA and CMA firms we should keep in mind that cost audit was introduced in Pakistan in 1998. I think before 1998 not a single firm of CMA exists in the country. How we can compare newly established CMA firms. In many of my posts I have pointed out that the profession of CMA is developing in Pakistan. But the number of practicing CMA’s is increasing by every passing day. Know there are more than 100 CMA firms are working in the country and if the cost audit right is solely assigned to CMA’s and CA’s are deprived from this audit right then Koyee Asman Nhn Toot Parega.

One thing I have noted that Mr. Kamaran extensively against the assignment of any financial audit right to CMA. But
only on the basis of 2 subjects of cost and management accounting (the material contained in these subjects are taught in the initial stages of ICMA) he is advocating the for the right of cost audit for CA’s. Contrarily in ICMA where a completely
separate subject has introduced named as Financial Reporting is being taught he is against the assignment of any financial audit right to CMA’s.

One should keep in mind that the recommended syllabus of IFAC is being taught that is the reason why the name of papers of ICMA and CIMA are even same.

Mr. Kamran Why you do not offer your valuable suggestion in relation to ICAP. Why do you give suggestions for ICMAP only.

Is the ICAP the most prestigious institute of the world?

Is there no need of improvement in ICAP?

Why you do not give recommendations and suggestions to the members of the forum
Who are
working as trainee students in audit firms for becoming a good auditor??

[kamranACA]

Ajnabi

Best of luck for your journey.

Regards,

[kamranACA]

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by kamranACA</i>
<br /><blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by awaisaftab</i>
<br />Before making any comparison of CA and CMA firms we should keep in mind that cost audit was introduced in Pakistan in 1998. I think before 1998 not a single firm of CMA exists in the country. How we can compare newly established CMA firms. In many of my posts I have pointed out that the profession of CMA is developing in Pakistan. But the number of practicing CMA’s is increasing by every passing day. Know there are more than 100 CMA firms are working in the country and if the cost audit right is solely assigned to CMA’s and CA’s are deprived from this audit right then Koyee Asman Nhn Toot Parega.

One thing I have noted that Mr. Kamaran extensively against the assignment of any financial audit right to CMA. But
only on the basis of 2 subjects of cost and management accounting (the material contained in these subjects are taught in the initial stages of ICMA) he is advocating the for the right of cost audit for CA’s. Contrarily in ICMA where a completely
separate subject has introduced named as Financial Reporting is being taught he is against the assignment of any financial audit right to CMA’s.

One should keep in mind that the recommended syllabus of IFAC is being taught that is the reason why the name of papers of ICMA and CIMA are even same.

Mr. Kamran Why you do not offer your valuable suggestion in relation to ICAP. Why do you give suggestions for ICMAP only.

Is the ICAP the most prestigious institute of the world?

Is there no need of improvement in ICAP?

Why you do not give recommendations and suggestions to the members of the forum
Who are
working as trainee students in audit firms for becoming a good auditor??

<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">


Awais

First of all I have a humble suggestion; whenever you will click others' ideas and will try to test your abilities on it you will do what you have done on the other thread and what you are doing on this thread. Suggestion is to avoid it. It will help.

Cost audit might have been introduced in 1998 but CMAs institute is there from 1966 (CMAs even believe it was there before this date). Professional practice is not only meant for Cost Audit. You (personally) are also very much found of financial audits by the way. Would you like to establish a firm just for getting two cost audits per year? Certainly not! So what are your people doing since 1966? This answer is just for your question. Otherwise I no where said that CMAs should not be given audit rights. I only pointed the areas where you have not paid any attention since 1966. And yes, this was also for CMAs benefit. You are not a CMA so far. When you will be a CMA then we will discuss it. Tab tak araam / chill karo!

As far as CA syllabus is concerned, you know you cannot qualify its Cost and Management Accounting papers in all of your life’s time? If not then join CA and prove my words wrong. By the way have you gone through such papers at CMA so far?

If you will visit the other thread you will find answers to all your confused questions. Go there and get the clarifications.

Regards,



KAMRAN.

<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">

[Ajnabi]

Kamran Sab,

I, while initiating the topic, said that Pakistan is an under developed Economy and it would be inappropriate to compare her Economy with UK, USA or any other well developed Countries, in the same manner, ICMAP should not have been compared with CIMA, rather it should have been compared with ICMAI (India), ICMAB (Bangladesh) or ICMAS (Srilanka), which are quite relevant as far as the comparison is concerned, this sounds quite inapt while ICMAP is compared with CIMA, and the same case is applicable when ICAP is compared with ICAEW or ICAS.

I respect your all comments regarding CIMA and I acknowledge that CIMA is quite a prestigious Institute which is recognized all over the world, however, there exists no logic if you simply averred CIMA to be on the upper side as compare to ICMAP as far as Pakistan is concerned, and this seems like comparing ACCA with ICAP in Pakistan, if ACCA cannot / Should not be compared to ICAP in Pakistan, due to the prestige of ICAP in Pakistan then comparing ICMAP with CIMA has no logic, neither theoretically nor it is seen practically that CIMA is being preferred over ICMAP, however, exceptional cases are always prevalent and the same exception is seen where ICAEW / ACCA is preferred over ICAP even in Pakistan. Had ICMAP being less capable to any Management Accountancy bodies of the world then it would not have been provided maximum exemptions by CIMA. You, in my opinion, be well aware with the exemptions being provided by CIMA to ICMAP Members, and this is quite an honorable achievement for Pakistani’s CMA to be well recognized throughout the world that we are being provided maximum number of CIMA’s papers exemptions.

The above Para has no concerned with the topic being discussed under the said subject, however, clarification was necessary.

Kamran Sab, I again vehement that ICAP and ICMAP are very prestige institutes of Pakistan, neither my basic purpose was to compare each other, which is of no worth since both are different field of specializations, nor I consider these institutes less capable to any other institutes of the world even outside Pakistan, be it ACCA, CIMA, ICAEW, ICAS etc., although I do not possess certificates of ICMAP and ICAP, even though I am almost fully exempted to take any examinations of the two institutes, however, I am of the view that our institutes should be well recognized in the world and should be considered at par with other eminent institutions of the world, rather my basic purpose was to discuss the Cost Audit rights of ICMAP, which is obviously, ICMAP’s negligence so far that it could not incorporated those crucial steps so far which we discussed. However, still Audit Rights should specifically be given to ICMAP rather ICMAP and ICAP.

My Comments regarding Budhay Chartered Accountants have been misapprehend by you, I did not mean what you analyzed, I meant that their position is quite strong on the one hand and ICMAP’s negligence on the audit front, these two factors, specifically later one, are main constrains toward Cost Audit right to be provided to ICMAP specifically.

Those problems, which I discussed, for which your avouchment is evident, can be settled by redacting quite few efforts;

1- Increase in number of Cost and Management Accountants firms again depends on many factors i.e. what revenue measures are available to strengthen these firms? Whether sufficient number of partners is available? Whether Quality professionals and supportive staff are available, whether those resources are available which are required for audit practice and does institute has affiliation from renowned international firms? Answer of these questions is quite sufficient to the question whether to increase number of firms is necessary currently or not.

2- Once ICMAP, through amendment in its act, start mandatory training requirement in the area of costing for its students then they will have those professionals, who have undergone intensive practical training. For this, ICMAP has to start atleast one year training requirement to be made mandatory for its student.

3- As far as the statement of their newly existence in the field is concerned, this will be sorted out once the aforesaid steps are taken.

Kamran Sab, let me tell you with conformity that topics being taught in ICMAP, in the area of Cost and Management Accountancy, are quite sufficient for an individual to be called an expert in the field of Cost/Management Accountancy, which, in my view, requires no modification in the current scenario. On the other hand, those topics, which are being taught in ICAP, are covered in initial first two examinations of ICMAP, which I named, besides some exceptional topics of Management Accounting of ICAP, which are covered in Strategic Financial Management of ICMAP. Let me further clarify that topics of SFM of ICMAP are also quite sufficient as compare to BFD of ICAP.

To achieve 50% passing marks in any subject is no issue at all, had the criteria set by these institute been invariable, Marks achieved by students would have been disclosed in their mark statements, however this is not the case in both of these institute, which is an another issue and has no concern with the topic, however, may be discussed separately should such necessity be arisen.

However, it requires clarification that almost equal number of students takes admission in ICMAP and ICAP in a given time period and with almost same capabilities, since both class of students belongs to the same nation. Similarly, almost equal students should be got through in the examinations of the two institutions, however, ICMAP results indicate around 5% of ICAP results, on the basis of these facts, saying straightaway that ICAP has tough examination criteria as compare to ICMAP sounds illogical. Had it had as much difficulty in ICAP examinations then results would have shown the output of ICMAP more than ICAP. However, the result is contrary to the general rule.

I am again of the view that Cost Audit rights will specifically be given to ICMAP within the next 5 years provided ICMAP put same efforts in this regard.

However, inspite of these facts, I am quite agree with you that a student cannot have required level of knowledge unless theoretically learnt techniques are applied practically. In this specific area ICMAP is reluctant to concentrate, but hopefully, soon this area will be covered.

In the end, I would clarify that I have no affiliation from either of the institutes’ inspite of being relevant from both institutes, however, do not merely prefer ICAP over ICMAP or vice versa based on the above grounds. I also apologize, if due to any reason, contents written above hurt you (Including alleging some Chartered Accountants as “Budhay”) or any other member.

Thanks for devoting your precious time in going through the post.


Regards,


Ajnabi.

[kamranACA]

Ajnabi

Thanks for your post and inputs on the topic and welcome back after your visit.

You have well defined, rather identified the reasons and deficiencies for which there are issues with permitting Audit rights to CMAs, be it cost audit or whatever. I have reasons to believe that unless such impediments are not corrected "audit rights" is not an issue for CMAs; rather ability and resource to perform "quality" audit is their core issue. I gave example of tax audit "rights" given to CMAs, which unfortunately could not help CMAs to secure even a single audit in actual allocation. Reasons are obvious, identified, and of course correctable.


As I said earlier, well structured, compulsory, vigorous and tough training is an imperative requirement (one of two) to produce a "professional" be it CA, CMA or of whatever field (doctor, engineer, pilot, lawyer, scientist etc) . Here the word professional has to be used and it needs to be carefully differentiated.if you are not trained, there is a little difference between you and M Coms and MBAs. You may not accept what I am saying; and for any graceful difference I do have all the professional regard.


Besides having fullest regard of your view point, I am sorry that I can't even accept that CMA syllabus anywhere offers greater depth than CA. Earlier there were 4 exams to qualify CA that have now been converted to 6 moduler exams. Merely increasing the number of papers or subjects does not mean you are going in some further depth. It however makes things easier some times and saves from tough times. I firmly believe you have some issues with understanding the facts or you by nature are inclined to present a better picture of one over the other. It's your prerogative and I am no body to influence your choice or thought. Being a human I can also be wrong in what I understand. That's why I thought it should not be debated further.

Further, keeping in view the difference of 5 years in establishment and comparitively lesser students trend/choice of joining CMA profession over CA (you can check number of students entered every year through all streams), the number of CAs and CMAs so far produced in Pakistan do not materially differ.

Although I do respect your view point but mentioning something due to influence of some others' info does not suit a person who Mashallah holds two international qualifications. I, at least expect better, independent and balanced analysis from you.

Just for an example that your analysis is one sided, influenced and totally against the facts, let me tell you with all due regard and respect that if we accept that only 5 percent of CMAs are produced every year against total CAs produced, then todate CMAs must have not been crossed a number of 250 to 275 since the inception of establishment of ICMAP. You I think are not aware that CAs so far produced have not crossed 6000 since the year 1961. These are yet around 5500 so far out of which number the alive CAs would not be more than 4400 (current rough estimate based upon last years actual figures).

I hope you don't need to be told that how many CMAs have been produced. Certainly they are not 250 in number as portrayed by your analysis.

I hope being a qualified person you would be knowing that ICMAP came into existence after 5 years of ICAP, and there is a substantial difference in the average number of students' intake in both professions.if you doubt on this, I hope you can get data of students intakes in both institutes during say last five years. Yet, you can figure out CMAs so far produced by ICMAP.

I hope you will gracefully accept your incorrect information and wrong estimation that has gravely affected the validity of the half of the material contained in your post and to your overall stance on the subject matter as well. I hope you will revisit your 5 percent conclusion.

I would reiterate that its my utmost wish that others should get rights provided they prove their capabilities since this is supposed to increase healthy competition in the market. However, "provided that they prove their capabilities" is of stringent importance and certainly I am no body to decide that such capability has been proved or in what time will be proved. (Although I may carry my personal opinion but no body should be affected since personally I can be right as well as wrong). To achieve what is required depends upon vision and an actively pursuaded and monitored action plan.

A also believe that you or I can only make suggestions that are neither a guaranteed step or measure to rectify the things nor are they any decision or conclusion.

I at the end would again like to thank you for sparing time and letting us know your view point. I also hope to see continued better analysis and nice inputs from you.

Stay safe and keep posting nice stuff.

Regards,



Kamran.

[MRS]

I wonder why CMA’s in Pakistan always try to compare them selves with CA’s. The two are meant to cater totally different branches of Accountancy.

I do not want to initiate any debate but in my opinion the reason CA’s are preferred over CMA’s by employers is that the profession of Management Accountancy has not matured in Pakistan and employers are not aware about the value a management accountant can bring to his business. Most of the CMA’s including me are not employed in our relevant field i.e. management accountancy. We are employed on finance side and there fore are always cheaper options for employers as compared to CA’s.

I fail to understand why so much emphasize is done on audit rights, we CMA’s are not meant to conduct audit. Just look at CIMA the most prestigious institute of management accountancy they even ignore the taxation side in their curriculum because it’s not their area of expertise. In UK CIMA members earn more than members of ICWAE the reason is that employers know the potential of management accountants and their importance in decision making process is acknowledged in developed world.

If we have to blame some one then we should blame ourselves for not promoting the profession of management accountancy in Pakistan. May I ask what role our institute has played in promoting our profession??? And our members including me have never tried to convey the value of management accountant to our employers. Just tell me how many organizations in Pakistan have a separate management accounts department???

I think it is unwise to shift the responsibility on others and complain like ordinary people. We the management accountants are not ordinary people and there fore we should start working towards promotion of our profession in Pakistan. Once we do it then only we can complain about biases and prejudice of other professionals towards us.


M.Rizwan

[awaisaftab]

Dear Rizwan and Ajnab

Emphasis is being given on cost audit. It is exclusively the rights of CMA's. Financial Audit is not being discussed here. I have already said that CMA profession is new in our country. Some months ago I wrote a thread on management accounting the response of the members were very surprising for me. very basic questions were raised by the members regarding management accounting. Many of us do not know the difference between management and cost accounting.

In my view some years ago there was no existence of the separate field of Finanacial Analysis but know it is an fastly emerging field of accounts and finance. The same can also be said about the field of internal audit. I am optimistic about the profession of management accounting in the country.

Regards,

Awais Aftab

<b>(This is only and only the reply of posts of MRS and Ajnabi)</b>

[MRS]

Dear Awais,

When i say audit i mean every kind of audit. In my opinion CMA's are not trained to conduct audit although we have covered knowledge area but we lack in training. For me audit is not my domain and thats again is my opinion.

regards
M.Rizwan

[awaisaftab]

Any CMA comes in the field of cost audit joins this field after training or after hiring the persons who have the desired level of knowledge of cost audits. As the number of CMA firms will increase we make better performence. As far as training in audit is concerned it should be gaind in some firms which have some prestige.

[MRS]

<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by awaisaftab</i>
<br /> Training in firms of low level like Taja,Maja Gama & Co's do not deliver any benifit to trainees.
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">

[D][D] i like your comments [D][D] this reminds me of a chartered accountant who was unfortunately my boss for three months after that i asked my CE either to change my department or accept my resignation as i cannot report to a clown [][o)][D]

[awaisaftab]

Oh!! MRS you copied my comments which I have deleted from my post. There was a difference of seconds. Anyhow these are not my comments.

[Ajnabi]

Rizwan,

I respect your comments and understand your feelings which are indicated in your posts; however, I expect that you must have gone through the foregoing posts, which sufficiently replies your most of the queries, i.e. we admit that ICMAP and ICAP produce two different types of professional Accountants for which comparison is illogical, CIMA is not to be compared with ICMAP on the grounds specified, Reasons for employers’ preference to CA over CMA, and others. I also acknowledge that Audit is not a core area of Management Accountants, furthermore, Cost Audit is not a statutory audit like Financial Audit, however, based on your views, a question should be asked whether what the need to introduce Cost Audit was? And why were the guidelines issued by ICMAP in this regard? Had it not been the concerned area then ICMAP would have considered some other facts and would have put in efforts elsewhere.

I initiated the topic, since I am and was of the view that Cost Audit rights should specifically be given to Cost Accountants, since similar practice is being followed throughout the world, then why should Pakistani CMA lack in this specific area? after above discussions, we are of the view that ICMAP has not put required efforts in this specific area so far, for which I am optimistic, as far as future of Management Accountancy and Cost Audit is concerned in Pakistan, that ICMAP will be able to get over on the aforementioned obstacles and it would start training as a mandatory for its student. Let the time come.

Let me clarify, in country like Pakistan, Professional Accountants must have sound knowledge about taxations issues due to the existence of contradictions in these two areas is much on the higher side as compare to other countries of the world.

Let me further comments on your views with regard to separate management accounts department, which may not be the case for the next many years. Since Pakistan is basically a developing country and most of the employers are of conservative view that a sole professional should be used to tackle their multiple problems, in such a case separate department, which is of no use, would attract a drastic effect over profitability. Which may not be borne by any employers.


Awais,
I am of the same view, which you said and thankful to you for adding value in this thread.


Kamran sab,
I am very much thankful to you for your valuable inputs.
I am of the view that future will decide better way for appropriate person.



Regards,


Ajnabi.