Chartered accountants handle statutory audits and GST audits. In companies, cost accountants take care of the cost and internal audit. Statutory audit is according to the compliances set by the government. As both professionals work in top management, there is tough competition between the two positions. The blog talks about a recent case that came to the Delhi High Court. An official from the IOC filed a petition to the court stating that the IOC had given preference in the appointment of a CA over cost accountants. IOC appointed Anuj Jain as Director of Finance. The company published an advertisement on November 25, 2022. The Finance director reports to the managing director, chairman and board of directors. The IOC board members discussed the job vacancy and the eligibility criteria at the board meeting held on 19, August, 2021. The board members preferred chartered accountants over cost accountants. The case study explains the competition between chartered and cost accountants in the corporate world.
Indian Oil Corporation case:
Agarwal applied for the position of finance director at IOC. He is a cost accountant. The petitioner was not short-listed for the finance director interview process. The Public enterprises selection board selected Jain as the suitable candidate. The reason for the appointment of Jain is that he is a chartered accountant. The applicant attended the interview with a court order. The result of the Finance director interview was not favourable to the petitioner Agarwal. Delhi High Court said that the nature of the work of a finance director is suitable for chartered accountants. Delhi High Court dismissed the case. The court says that the decision of the expert committee has no compelling reasons and that the selection process is fair.
The responsibilities of the finance director at PSU:
- The finance director is responsible for formulating finance policies.
- The finance director implements the policies and fulfils the business objectives.
- The finance director checks the performance of the employees.
- The finance director thinks about financial problems and constantly has an eye on the financial status.
- The finance director checks the IT system and uses the apt technology.
- The finance director sets targets for the accounts and finance professionals in the company. He checks the performance and motivates the human resources.
- The finance director checks the internal system and audits the internal controls.
- The finance director communicates and maintains healthy relationships with the investors and partners.
- The finance director prepares the quarterly half-yearly, and annual reports.
- The finance director adheres to the guidelines and laws of ICAI.
- The finance director has in-depth knowledge about the best practices of the industry.
- The finance director analyses financial operations and forecasts the challenges.
- The finance director has efficient knowledge of SAP and MS Office.
- The finance director supports the investors and understands the business review from the external environment.
- The finance director does long-term planning and forecasts future needs.
IS CA tougher than CMA?
The pass percentage of 2023 CA students is 8.33. The pass percentage of 2023 CMA students stands at 13.67. The numbers show that the percentage is high in the CMA course. CA is the toughest course that prepares students for the auditing profession. CMA is an equally challenging course. CA is suitable for students with above-average intellectual. CMA is suitable for students with an interest in working in top-level management. At the education level, the CA course is a difficult one. At the job level, CA and CMA are high-pressure jobs.
Competition between CA and CMA:
The finance professionals have a thread and fine line as a connection and disconnection feature. Students learning finance professional courses like CA, CMA, ACCA, CFA and CPA should understand the value and difference in the corporate demand. The competition is because of the market challenges and growth factors. The following points explain the job roles and professional ethics of a chartered and cost accountant:
- Chartered accountants work in banks, insurance firms and investment houses as statutory auditors.
- Chartered accountants work in manufacturing companies as GST auditors.
- Cost accountants work in PSUs as internal auditors.
- Cost accountants work in the BPO sector as FOAs (financial operations associates).
- Cost accountants work as market analysts in the share market.
- Cost accountants work as data analysts in private and public companies.
- Chartered accountants contribute to the tax collection process of the government. Chartered accountants help with tax evasion.
- Cost accountants contribute to human resource management and market competition. The cost accountants raise Indian companies to international standards.
- The pass percentage of the chartered accountancy course is comparatively lower than the cost accountancy course. Cost accountants find the course far better than auditing subjects.
- If a student has three certificates such as chartered accountancy, cost accountancy and company secretary ship. He has to cancel the other two certificates and practice one role. If he is doing the job, then three certifications help him gain specialised knowledge.
The real-time case study highlights the value of education with professionals. Professional courses are to show the students separated from a group of people. Data analytics, business analytics, quantitative economics, information science, MBA and MS finance are the STEM courses with finance back-up. Many top universities are offering STEM-focused courses to prepare the young generation for the changing world needs. STEM is the courses with a foundation in science, technology, engineering and math. These subjects require software and math knowledge. Finance, accounting, auditing, and business are the different names of commercial courses. The technology-driven courses are setting trends for some of the global jobs. Competition increases the demand and specialisation in a subject. Healthy competition is good for a job. CA and CMA professionals handle crucial operations. CA and CMA professionals influence management decisions and financial growth.