|DIRECTORS REPORT 2011|
TO THE MEMBERS OF ICAI ACCOUNTING RESEARCH FOUNDATION
The Directors have pleasure in presenting the Twelfth Annual Report of the ICAI Accounting Research Foundation (ICAI ARF), together with the Audited Balance-Sheet, Income and Expenditure Account and Cash Flow Statement for the Financial Year ended 31st March 2011.
The Institute of Chartered Accountants of India, set up under an Act of Parliament – The Chartered Accountants Act, 1949 has established ICAI Accounting Research Foundation (ICAI-ARF) in January, 1999, as a Section 25 company – a core research body to promote research in the areas of accounting, auditing, capital markets, fiscal policies, monetary policies and other related disciplines. The ICAI ARF promoted by the Institute of Chartered Accountants of India (ICAI) has accelerated its work programme during the year as an academy for imparting, spreading and promoting knowledge, learning, education and understanding in the various fields related to the profession of accountancy. The ICAI ARF has undertaken many projects involving basic and applied research. The ICAI ARF believes that proper research inputs are necessary condition for raising the level of corporate governance, management, accounting and financial reporting. High quality research projects based on practical experience with theoretical extrapolations would also provide valuable inputs in formulation of policies and implementation thereof at macro and micro levels.
The ICAI ARF has completed another successful year, 2010-11, in establishing the Foundation as a core research body in the areas of Accounting, Auditing, Fiscal Laws and Policy, Corporate and Economic Laws and Policies, Economics, Financial Management, Financial Services, Capital and Money Markets and other related disciplines.
Recognizing the impetus required for promoting quality research in the country, the Board has adopted and pursued a multi - pronged action plan to support research projects of contemporary national and international significance in the areas related to accountancy profession. The ICAI ARF has extended an open invitation to undertake research to various institutions, research bodies, research scholars and the practitioners. Focussed advertisements were also put up on the website of ICAI ARF, ICAI, and in the Journal of ICAI 'The Chartered Accountant', inviting expression of interest from the members and others to carryout research in the areas of contemporary interest with requisite financial support from ICAI ARF with an option of pursuing the research or for taking up of systematic study in relevant areas. As a consequence, during the year number of research projects has been commissioned, including those with bodies like IIM, Bangalore, Institute of Public Enterprises, Oxford University and other researchers.
New value added projects will continue to be the fundamental part of subsistence of ICAI ARF. Accordingly, projects that would add value and help in spreading, promoting and advancement of various disciplines in the fields of accountancy, auditing, fiscal laws and policy, corporate and economic laws and policies, economics, financial management, financial services, capital and money markets, management information and control systems and other allied fields are being undertaken.
The main objective of the establishment of ICAI ARF is to undertake, conduct, foster, promote and provide aid and facilities for prosecuting core, fundamental, empirical, applied and other kinds of research work, projects and studies. The research work undertaken by ICAI ARF has been divided amongst two branches of research, viz., (I) Basic Research, and (II) Applied Research.
The status of major research projects completed during the year and presently undertaken/implementation under basic and applied research is given below along with particulars of proposals that are under consideration:
(I) BASIC RESEARCH:
Basic research is designed to add to an organized body of scientific knowledge and does not necessary produce results of immediate practical value. It is concerned with formulation of a theory or a contribution to theory. The ICAI ARF involves carrying out basic research projects pertaining to subjects requiring enquiring into problems and issues significant to accounting and auditing and allied disciplines such as economics, finance and business laws through outsourcing research projects by inviting applications from research bodies/scholars and providing them financial assistance. In view of the above, the following projects have been undertaken by ICAI ARF:
PROJECTS COMPLETED DURING THE YEAR:
The following research projects undertaken earlier have successfully been completed during the year 2010-11:
a. Contextualization of the concept of corporate governance with common attributes of fairness, accountability and transparency;
b. Emergence of NGOs as the predominant form of NPOs;
c. Profile of NPOs in the country by number, type and activities;
d. Legal framework governing NPO sector special emphasis relating to fiscal laws and foreign contributions;
e. Key attributes of NPOs and their performance;
f. Fund rising and its applications by NPOs;
g. Corporate Governance structure models and their applicability to NPOs, and
h. Model code of governance for NPOs.
(II) APPLIED RESEARCH:
Applied Research is directed towards the solution of immediate specific and practical problems. It is performed in relation to actual problems and under the conditions in which they are found in practice. The applied research requires systematic study to gain knowledge or understanding necessary to determine the means by which a recognized and specific need may be met.
In view of the above, ICAI ARF has undertaken projects related to conversion of accounts from cash basis to accrual system of Accounting for Municipal Corporation of Delhi (MCD), Kolkata Municipal Corporation (KMC) & Controller General of Accounts (CGA) etc. involving conceptualizing a new accounting system including the incorporation of methodologies and procedures not current in India and same had been successfully completed. The Foundation has also undertaken DFID Project relating to Strengthening Rural Decentralization (SRD) suggesting a detailed methodology and road map for under pinning the issues on a logical framework. In continuation to above, the following projects have further been undertaken by ICAI ARF:
To further promote the applied research, the foundation office is working on the lines of the aforesaid projects and undertakes the following projects, as given below:
During the year the revenue from research activities has been Rs. 98.33 Lakh as against Rs. 25.94 Lakh in the previous year. The excess of expenditure over income is Rs 18.85 Lakh as compared to the deficit of about Rs. 1.84 Lakh during the year 2009-10. Since there has not been any surplus in the F.Y. 2010-11, therefore no amount could be appropriated towards the building reserve. Financial results for the year 2010-11 compared with those of previous year are summarized below:
(Amount in Rs.)
STRENGHTHENING OF INFRASTRUCTURAL BASE:
THE WAY FORWARD:
Recognising the fact that considerable efforts are required to promote research in the field of accounting in India, ICAI ARF has taken a number of proactive measures for undertaking applied research, and carrying out research studies. The ICAI ARF would further intensify promotional campaign for establishing direct contact with the Universities and other bodies on the one hand, and reaching out to the potential researchers throughout the country, on the other.
The list of proposed research projects of contemporary national and international significance and proposed research projects for Ph. D degree would be further expanded, and expression of interest invited. In selected areas, ICAI ARF may directly undertake research. Possibilities for networking with research organisation of repute, within and outside India would be explored. Series of technical documents are proposed to be published and focussed training programmes organised for dissemination of technical knowledge and skills to various stakeholders.
CONSERVATION OF ENERGY, TECHNOLOGY ABSORPTION, FOREIGN EXCHANGE EARNINGS AND EXPENDITURE:
Particulars of Employees: Pursuant to provisions of section 217(2A) of the Companies Act, 1956 read with the Companies (Particulars of Employees) Rules, 1975, as amended from time to time, it is stated that no employee was in receipt of remuneration exceeding Rs. 24 Lakhs per annum or Rs. 2.00 Lakh per month during the year 2009-10.
DIRECTORS RESPONSIBILITY STATEMENT:
As required by section 217(2AA), Board of Directors hereby confirms that:
The foundation has maintained the cordial and harmonious relations at all levels. Efforts were made to inculcate team spirit and motivate the employees to fully develop there potential.
HUMAN RESOURCE DEVELOPMENT
The Foundation has always considered that its core strength lie in quality of its human assets.
Welfare of the employees had received due attention during the year.
BOARD OF DIRECTORS
During the year CA. Amarjit Chopra relinquished the charge of Chairman held by him as Ex-Officio. The Board places on record its appreciation for the commendable services and contribution made by CA. Amarjit Chopra.
M/s. V. Shankar Aiyar & Company Chartered Accountants, retire as Auditors at the conclusion of this Annual General Meeting and have further confirmed their eligibility under 224(1B) of the Companies, 1956.
The Board take this opportunity to place on record their appreciation for the continued assistance, support and co-operation received from the Ministry of Corporate Affairs- Government of India, State Governments and their Urban Local Bodies, M/s. Infosys Technologies Ltd, Office of Department of Posts (DoP), Government of India, Guru Gobind Singh Indraprastha University, Bank of India and other authorities, experts, research scholars and individuals during the course of execution of the research projects and in other disciplines.
The Board of Directors sincerely appreciate and commend the valuable contribution made by the employees of the foundation at all levels in the pursuit of achieving excellent result for another year in succession.
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