ICAI Issues Draft Guidelines for CA Firms in Overseas Networks

The Institute of Chartered Accountants of India (ICAI), through its Committee for Aggregation of CA Firms (CACAF), has released an Exposure Draft of the proposed Guidelines for Overseas Network. This draft is open for public comments until 27th June 2025, and marks a significant regulatory development aimed at fostering cross-border professional collaboration while ensuring accountability and ethical compliance for Indian CA firms involved in global networks.

The objective of the proposed guidelines is to establish a robust framework for registration, regulation, and ethical supervision of Overseas Networks, defined as any formal or informal arrangements between domestic ICAI-registered CA firms and foreign entities engaged in similar professional services. The draft aims to enhance global competitiveness of Indian firms, facilitate access to international best practices, and ensure compliance with Indian laws and ICAI’s Code of Ethics.

Under the draft, Overseas Networks will be required to undergo a mandatory registration process, beginning with approval of a distinct network name and culminating in a detailed registration process, both subject to administrative scrutiny and fees. The guidelines introduce the concept of a Nodal Officer cum Contact Point, a member of ICAI in good standing, who will be responsible for compliance and communication on behalf of the network.

The guidelines specify the permitted and prohibited services, reinforcing that all intra-network transactions must be at arm’s length and in compliance with Indian laws. Importantly, prohibited services as per the Companies Act, 2013, and ICAI’s ethical standards cannot be circumvented through network affiliations. Furthermore, disciplinary consequences are prescribed for violations such as associating with unregistered networks, non-disclosures, or unethical fee-sharing arrangements.

Annual reporting, ethical compliance, and maintenance of transparency in affiliations form integral components of the framework. The guidelines draw upon global best practices and legal precedents, including directives from the Hon’ble Supreme Court in the matter of multinational accounting firms operating in India. These provisions aim to establish a level playing field for Indian CA firms, ensuring fair participation in global accounting and auditing services.

Stakeholders are encouraged to review the draft and submit their views by the stated deadline via the provided online form, email, or postal correspondence. The Exposure Draft and relevant forms, including those for registration (Form AO and BO), change in constitution (Form CO), and de-registration (Form EO), are available for download from the ICAI website.

Click here to read the complete Exposure Draft

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