Cost Audit Rights of ICMAP - Why ICAP is allowed?

[MRS]

I had already mentioned that the purpose was not to initiate any debate but it was just an exercise of sharing my opinion. Ajnabi we do agree on many points but we do differ on the subject of cost audit. The problem is that we are not paying attention to our core competency (i.e management accountancy) and are worried about those areas which do not come under our core competencies (i.e audit).I know many members are also lobbying to get rights of financial audit which is wastage of time and energy rather same energy should be invested in promoting our profession (i.e management accountancy). We need to concentrate on our strengths rather than trying to make up with our weaknesses.

i have written my comments in blue below.

Enjoy

M.Rizwan
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by Ajnabi</i>
<br />Rizwan,


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.

<font color="blue">Till that time my opinion holds true isn't it ? and let me assure you dear, once that time comes my opinion will also change as i am not that kind of person who stick to his points no matter how much the circumstances change. Please allow me to stick to my opinion for time being.</font id="blue">


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.[/black]

<font color="blue">The above statement of yours explain my point that we have failed to clear wrong perceptions in the mind of employers. The fact is that management accountants increases the profitability of organizations. Who is responsible for this wrong perception ??</font id="blue">

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.
<font color="blue">Agreed , but do we have any plan for future?? is our institute doing any thing in this regard?? and the least said about our members best it will be.

Enjoy</font id="blue">


Regards,


Ajnabi.

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

[kamranACA]

Dear Ajnabi and MRS

As Ajnabi said, I too hope good days may lie ahead but (agreeing to MRS) such days will never be witnessed unless the required focus (in fact focal/core area of speciliaty) is established and the needful is done, good days should not be dreamed.

Hoping for the best, however.

As far as advocating exclusive "cost audit" rights without bothering for "training" and financial audit rights is concerned, to my humble perception, it is totally un-useful and unfocused approach.

I already emphasized "training" and need not to explain that a fresh CMA without training is a "layman" as far as audit is concerned. Broad guidelines have to be broken down in approach, activities and procedures. I need not to explain that untrained qualified ones cannot do so. Certainly understanding the processes, flow of systems, technical understanding of machineries and their outputs, specifications, cost accumulation methods, cost formulaue and techniques, allocation of common costs, in highly complex manufacturing sectors like textiles (cotton ginning to cotton to yarn to fabric to processed fabric to made-ups and garments) or others like tanneries or even cement, sugar, ghee, fertilizer so on and so forth are not something to be learnt from books. I agree the principles remain same but practical knowledge is inevitable. So, without it there is no logic of CMAs' audit rights even if these have been given shoulder to shoulder with CAs.

Yes, once well structured and effective (manufacturing sector based as a must) practical training is made the part of CMAs qualification, then there is no harm in doing so.

However, as I said once earlier, merely the "cost audit" rights do not carry any meanings. Can a CMA establish a firm merely in hope of one or two "cost audits" in whole season? Kyun bhooka maarnaa hai yaar. Woh aik do bhi milain na milain. If its reply is, that they can engage in non audit professional practice to diversify their practice, then my question will stand again that if it could be done what is being waited for since 1966. Why CMAs so found of "audit" do not take an initiative to establish firms for their upcoming CMAs?

Certainly there were and are reasons for it; and to decrease the severity some of CMA brothers put this responsibility on the shoulders of others.

I appreciate and believe in the words of MRS. He appears to be realistic, familiar with facts on ground, and in factual knowledge of what CMA is meant for and how effective it's role can be in the coming days provided required things are done.

I believe the positive discussion with graceful and decent arguments both by Ajnabi and MRS have made the readers to grasp the theme in a more effective manner. I pay my due thanks to both of you for this contribution.

To dissent calmly and morally with due justifications and well founded reasoning appeals and may make the others to modify the opinions.

MRS your are really appreciated.


Regards,



Kamran.

[shahbaz_Noor]

AA, first of all thank for sharing valuable information and guiding new comers in this field to decide what they want to be an all rounder or just a peace of accountant. if you want to be all rounder join chartered accountancy and if you want to be just an accountant you should join Management Accountancy, cost audit is not compulsory but i think it is more important than financial audit, cost audit of necessities like food,sugar, etc, is more important as due to proper check and balance government can control the price of necessities. and it is must be conduct by management accountant as he is professional trained in field of cost and costing. if it is not possible than chartered accountant should not be allowed to conduct without hiring services of Management Accountant firm.

CMA can do financial audit of firm having paid up capital less than 2 million.

CMAs have very good systematic thinking and system scanning skills to purify it with use of risk assessment tools, but CA has good power to tackle mistakes, fraud etc which is committed by accountants.

ACMA is not eassy as one of fellow in forum rated CA very tuff and argued it is very difficult to pass CA, Cost and Manament Paper, i just want to add one thing, if CA is as tuff than why did they imposed restriction on ACMAs that ACMA can give paper after two year after ACMA

both have their education system and syllabus we should not criticise each other

[shahbaz_Noor]

AA, first of all thank for sharing valuable information and guiding new comers in this field to decide what they want to be an all rounder or just a peace of accountant. if you want to be all rounder join chartered accountancy and if you want to be just an accountant you should join Management Accountancy, cost audit is not compulsory but i think it is more important than financial audit, cost audit of necessities like food,sugar, etc, is more important as due to proper check and balance government can control the price of necessities. and it is must be conduct by management accountant as he is professional trained in field of cost and costing. if it is not possible than chartered accountant should not be allowed to conduct without hiring services of Management Accountant firm.

CMA can do financial audit of firm having paid up capital less than 2 million.

CMAs have very good systematic thinking and system scanning skills to purify it with use of risk assessment tools, but CA has good power to tackle mistakes, fraud etc which is committed by accountants.

ACMA is not eassy as one of fellow in forum rated CA very tuff and argued it is very difficult to pass CA, Cost and Manament Paper, i just want to add one thing, if CA is as tuff than why did they imposed restriction on ACMAs that ACMA can give paper after two year after ACMA

both have their education system and syllabus we should not criticise each other