1. Strategies for Practise
Development vis-a-vis Mergers
and Networking
K.Raghu FCA
Bangalore

2. Current Practises
Sole Proprietory Firms
One-man Show
Insufficient time
80 : 20 rule
Working after office hours

3. Myths in CA practise
 Only large firms need proper systems
 Networking doesn’t work
 Mergers are not successful
 CA’s are good only in Taxation and Audit

4. Changes in CA practise
 Dwindling traditional practise
 More automation – Less Paper trail
 Need to understand clients business in a
changing technology environment
 Shift from Compliance related services to Value
added services
 Increasing clients awareness
 Client relationships becoming more professional
and formal

5. Changes in CA practise
 Need for Succession Planning
 Need to upgrade IT infrastructure
 Need to upgrade Office infrastructure
 Single Window service
 Specialisation
 Multi-Locational Service
 Services to Global organisations

6. Challenges in CA practise
 Retaining client base
 Recruit and retaining quality staff
 Litigation
 Competition from Big 4 and others
 Level of Fees
 Mandatatory CPE
 Introduction of Peer Review.

7. CA Practise
The way forward
 Networking
 Mergers
 Specialisations

8. Definition of Networking
 “NETWORKING amongst two or more
firms means an entity under common
control, ownership and management with
the firm or having affiliation with an
accounting entity or any entity that a
reasonable and informed third party having
knowledge of all relevant information
would reasonably conclude as being part of
the firm nationally or internationally”

9. Networking
Necessary Conditions
 Appointment of a Managing Committee
 Engagement Partner
 Review Partner
 Sharing of Profits
 Contribution of Membership Fees
 Administration of the Network

10. Networking
Optional Conditions
 PublishingE-Newsletters
 Development of Training Materials
 Development and maintenance of databases
 Appointment of a Technical Director
 Development of a digital library
 Development of Software
 Determine Uniform Fees across the network

11. Networking
Optional Conditions
 PeerReviews of the member firms
 Conduct Seminars for updating the Seminars

12. Networking – ICAI guidelines
 ICAI has started registering Networks
 ICAI guidelines to be followed for formation
and registration of Networks.
 Network to have distinct name which has to
be approved by the Institute
 “ & Affiliates” should be used after the name
of the Network
 Prescribed format of application for approval
of Name – Form A
 Networks cannot advertise nor use a logo

13. Networking – ICAI guidelines
 Registration of Network with ICAI in Form B.
 Proprietory/Partnership Firms as well as
individuals to join only one network
 Exit from Network to be done by sending
declaration in Dorm C to ICAI

14. New Opportunities and
Networking
 INFORMATION TECHNOLOGY
 ERP Implementation
 E-Commerce Implementation
 Information Systems Audit
 Information Systems Consultancy
 Detection of Computer Crimes
 Data and System Assurance Services
 Web Trust Seal and Certification

15. New Opportunities and
Networking
 BUSINESS PROCESS OUTSOURCING
 PayrollProcessing
 US Tax Returns Processing
 Accounting
 Claims Processing

16. New Opportunities and
Networking
 INSURANCE SECTOR
 Claims Management
 Risk Management
 Third Party Administrative Services
 Underwriting
 Survey and Loss Assesment

17. New Opportunities and
Networking
 INTERNATIONAL TAXATION
 Advising on Cross Border issues
 Development international financial
products
 Consulting under SOX Act.

18. Mergers – Pro’s and Con’s
 Compensation for immovable property
 Differing scale of fees
 Differing staff salary structures
 Fear about loss of clientele
 Loss of independence and flexibility
 Power and Profit sharing mechanisms
 Personal expenses

19. Mergers - Merits
 Reduced Overheads
 Shared burdenstensions
 Improved quality of service
 Improved infrastructure
 Better quality of staff and training
 Better image
 Capability to handle large assignments
 Continuity
 Synergy in operations

20. Mergers - Demerits
 Clash of work cultures, personality clashes
 Loss of clientele
 Staff redundancy
 Integration of different staffing policies
 Loss of personal touch with clients
 Increased fees

21. Strategies for Practise
Development
 Delegation of work
 Creating teams for assignments
 Time Limits for administrative work
 Use of pre-printed formats
 Checklists for all important work system of
appointments
 Responsible persons for answering routine
queries

22. Strategies for Practise Development
 Create client awareness by sending circulars
 Use automation for MIS, Billing etc.,
 Keep 10% - 20% time for reading
 Paper clearance week
 Code of conduct for Articled clerks and
employees
 Periodical reporting system to partners
 Training to articled clerks and office staff
 Hiring Quality Manpower

23. Tactics to enchance Client value
 Improving client contact
 Sending useful articles to clients
 Helping clients with your contacts
 Building a personal relationship with the client
 Participating in social activities
 Offering use of firms facilities
 Volunteering to attend clients internal
meetings if required
 Using technology to improve turn-around time

24. Tactics to improve Profitability
 Withdraw from services that cannot support
salary levels – Drop non-remunerative clients
 Earn higher fees through specialisation and
innovation
 Improve speed of Billing
 Improve speed of Collection
 Reduce space and equipment costs
 Accommodate part-time and flexi staff

25. Conclusion
 OUR MISSION
 SERVICE
 Delivering outstanding client service
SATISFACTION
 Provide maximum satisfaction to clients
SUCCESS
Achieve financial success

26. Thanks
 Members for a patient listening