INCREASED INSTITUTE FEES FOR CHARTERED ACCOUNTANTS- IS IT JUSTIFIED?

The institutional announcement:

The ICAI has announced increase in fees payable as members and as practioners w.e.f.01.04.2001 vide communication  dated 25th February, 2011. The communication reads as follows:

ATTENTION OF MEMBERS

Kind attention of Members is invited to the revised schedule of Membership and related fee effective from 01st April, 2011 as given below: -

Members who are senior citizens i.e. have attained the age of 65 years as on 1st April of the relevant year will be required to pay the fees at lower rates which is as under: -

Particular of Fees Revised Fee (Rupees)

Annual membership Fee

Associate Fee   600

Fellow Fee    1600

Certificate of Practice Fee 1500

Particulars of Fees Revised Fee (Rupees)

Membership Fee

Entrance Fee                           1200

Fellow Admission Fee            1800

Annual membership Fee

Associate Fee                          800

Fellow Fee                            2200

Certificate of Practice Fee 2000

Restoration Fee 1200

Members are requested to remit fee for membership /Certificate of Practice / Fellow membership at the prescribed amount as applicable to them.

S d/ -

(T. Karthikeyan)

Secretary

Members can pay their fee on line by clicking online payments link on the homepage of www.icai.org.

Inflation effect:

It seems that the Institute has taken advantage of  hardest and most popular present  problem of general public that is inflation. However the communication does not indicate the existing structure of fees. Therefore, one cannot easily find the actual increase of fees. For that one need to make extra efforts to find out old rate, new rates and difference.

Recurring annual fees:

Recurring annual fees is payable by members to continue membership and if any member also want to hold certificate of practice  (COP) an additional fees is payable.

Revised annul fees in a tabular form for senior members is as follows:

Revised fees in a tabular form for other members is as follows:

Entrance Fee: 

Entrance fees of Rs.1200 is payable when a person who has qualified as CA want to be enrolled as an ACA. Thus for a newly qualified CA who want to become a member will have to pay  Rs.1200/- as entrance fees plus Rs. 800/- as annual fees = Rs.2000/-

If he want to start practice he will have to pay another Rs.2000/- for COP. Thus total outgo for a new CA in practice on this account will be Rs.4000/-. Is it not on  higher side?

Fellow Admission

On completing five years as member and meeting other requisites one can apply for fellowship of the institute. For becoming a fellow an admission Fee of Rs.1800/- will be payable beside on becoming FCA the annual fees and COP fees will also be increased. This is reason that many senior members are still continuing as ACA.

Restoration

If any member is removed from the register of members for any reasons  the institute charges an additional fees of Rs.1200 which is  called Restoration Fee for restoration of name to register of members.

Services rendered by ICAI to its members:

For members (ACA and FCA) the institute maintains register of members, COP holders, voters register etc. Institute also regulates conduct of members. Institute also provide a copy of its journal “The Chartered Accountant” to its members. These services are rendered to members irrespective of holding of COP.

CA, ACA,FCA and employment:

A member can get job because he has qualified as a CA and it may not be necessary that he should be a member of ICAI. Author has found many members who joined services and attained seniority in job but have not applied to become a FCA. Many members who are in service have stopped paying even annual fees for ACA.  Many students who joined service and continued in service after passing the examination did not even become a  member. This is because in employment what is relevant is the fact of passing ICAI l examinations and the experience gained. The membership is not very much relevant in salaried occupations.

Annual fees for COP- is not justified:

Membership fees is Okay, however, fees for COP is not justified. This is because  any additional services are not rendered by the ICAI to  COP holders. Even a member, who does not hold COP, can avail most of facilities of institute.

Merely because a member who want to engage in practice need a COP from ICAI, a substantial annual fees is not justified.  A onetime  fees for issuing COP may be charged once when COP is granted thereafter payment of membership fees should only be required for continuity of COP.

In professions like  Doctors ,Advocates, engineers, architects, MBA, etc. there is no COP fees payable.  As there is not much additional service to members holding COP, there is no justification of charging COP fees from members.  There is some token payment required at the time of enrolment or registration with governing bodies. There is no annual fees charged to such professionals.

Students – fees has been increased many folds:

Services are provided to students for studies and examination. Earlier the fees charged from students was very low, however over a period of time fees charged to students have also gone up substantially.

Substantial hike in fees is not justified:

Apparently it can be said that substantial hike in fees charged to members for membership and COP and also fees charged to students is on higher side and there should not be substantial increase a regular feature. The institute must consider the issue in a reasonable manner.