CA held guilty by ICAI: Cares to be Taken, while Issuing a Certificate

 CA held guilty by ICAI: Cares to be Taken, while Issuing a Certificate

1) Identify Addressee

2) Specify purpose

3) No Collusion

The Disciplinary Committee of ICAI in the matter Shri H.G. Nagaraju Vs. CA. Lingaraj M. Pujari has held that CA writing to whomsoever it may concern on a certificate reprimanded by ICAI for professional misconduct.

The Board of Discipline vide Findings dated 10th February 2023 was of the view that CA. Lingaraj M. Pujari (M.No.225579) is Guilty of “Other Misconduct” falling within the meaning of Item (2) of Part-IV of the First Schedule to the Chartered Accountants Act, 1949 read with Sec 22 of the said Act.

The Board has carefully gone through the facts of the case along with the oral and written representation of CA. Lingaraj M.Pujari.

As per the Findings of the Board as contained in its report, the Respondent was appointed by the Company vide its appointment letter dated 9th January 2017 for issuing a Certificate showing expenditures which are not supported by any bills, vouchers, documents, etc. and unapproved payments from the Financial Year 2011-12 to the Financial Year 2016-17. The Respondent issued a Certificate of expenditure dated 31st January, 2017 for the financial years 2011-12 to 2016-2017 where no support or approvals were available. The Certificate issued by him was not address addressed to “To Whomsoever It May Concern” and the purpose for which the same had been issued was not specified therein. The Board viewed that Guidance Note issued by the Institute (ICAI) i.e. “Guidance Note on Reports or Certificates for Special Purposes” clearly states that there is no standardized format for reporting on such engagements. Instead, certain basic elements were identified which include to identify addressee. However, it is also mentioned that in some cases such Certificate or report could be for other intended users hence, could be issued to such other unidentifiable user. However, since in the instant case, the Respondent had been appointed by the company and the Certificate was not addressed to the company but to unidentified users by usage of phrase “To Whomsoever It May Concern”, the Board was of the view that the very purpose for which the Certificate had been issued by the Respondent becomes questionable and misleading. The Board on bare perusal of the entries in the Annexures to the Certificate issued by the Respondent noted that the majority of the entries provided therein which were allegedly unapproved, pertained to the Complainant only. Thus, the Board was of the view that the act of the Respondent of issuing a Certificate addressed to unidentified users indicates that the same had been issued by him in collusion with the other directors of the company. The Board was of the view that it was the duty of the Respondent to perform a thorough and careful examination of the fact/data and issue an unbiased certificate which in the instant case was lacking. The said compromising conduct of the Respondent shows his malafide intention of acting in collusion with the other directors of the company which is clearly unbecoming of a Chartered Accountant and thus, has brought disrepute to the profession. Accordingly, the Board held the Respondent Guilty of “Other Misconduct” falling within the meaning of Item (2) of Part-IV of the First Schedule to the Chartered Accountants Act, 1949 read with section 22 of the said Act.

Thus, upon consideration of the facts of the case, the consequent misconduct of CA Lingaraj M. Pujari (M. No.225579) and keeping in view his oral and written representation before it, the Board decided to Reprimand of CA. Lingaraj M. Pujari (M. No.225579).