The Institute of Chartered Accountants of India (ICAI) had organised Programme on Financial Reporting Practices for Political Parties on June 23, 2015 at New Delhi. The main objective of the programme was to enhance the financial reporting skills of the auditors of Political Parties.The programme was inaugurated by Dr. Nasim Zaidi, Chief Election Commissioner along with Shri P.K. Dash, Director General, Election Commission of India, CA. Manoj Fadnis, President ICAI and CA. M. Devaraja Reddy, Vice- President, ICAI. The programme was attended by the auditors of 27 political parties.

Dr. Nasim Zaidi explained that Election Commission of India is vested with the responsibility to conduct free and fair elections but the concerns have been raised in various quarters about the quantum and nature of expenditure incurred in conducting free and fair elections. So the political parties are accountable for funds raised and expenditure incurred which in turn has made the role of accounting and auditing professionals more critical in lending credibility to the financial statements. He urged the participants that the financial statements of political parties should conform to ‘Guidance Note on Accounting and Auditing of Political Parties’ as mandated by ‘Guidelines on transparency and accountability in party funds and election expenditure’ issued by Election Commission of India.

He explained that detailed disclosures would foster confidence of various stakeholders. He also lauded the efforts undertaken by ICAI for creating awareness among the political parties to adopt better practices in the preparation of financial statements of political parties.

He assured that Election Commission would work in consultation and co-operation with ICAI to make the financial statements of political parties more transparent and accountable.

CA. Manoj Fadnis, President, ICAI highlighted the responsibility of auditor vis-a-vis his limitations in conducting audit. He emphasized that in present scenario the expectations of regulators, public and the nation from the accountancy and auditing profession have increased manifold, therefore, the professionals have to understand their responsibilities for the preparation and presentation of transparent financial statements. He said that such programme is providing a platform for constructive interactions and debate on various accounting issues of the political parties. He also complimented FRRB for going hand in hand with regulators for improving transparency in financial reporting practices followed in the country.

Shri P.K. Dash explained that Election Commission of India has issued ‘Guidelines on transparency and accountability in party funds and election expenditure’ under article 324 of the Constitution, to conduct free and fair elections. He added that to bring transparency and accountability in funding of political parties the said guidelines requires that the accounts of political parties should comply with the ‘Guidance note on Accounting and Auditing of Political Parties’ issued by the ICAI.

CA. M. Devaraja Reddy, Vice-President, ICAI highlighted the importance of information to the stakeholders and stated that the importance of transparent financial statements has become far more important than ever. He requested auditors to properly comply with the financial reporting requirements as well as to make adequate disclosures in the financial statements.

The programme has given an insight of the emerging challenges to participants in their role when they attest the financial statements of the various political parties and appraised them about various regulatory requirements that should be kept in mind while discharging their function

The topics covered in the programme are ‘Applicability of Accounting Standards on Political Parties’, ‘Compliance of Guidance Note on Accounting and Auditing of Political Parties issued by ICAI’ and ‘Common non-compliances observed in the annual audited accounts of Political Parties’.

ICAI is constantly making endeavors to contribute towards Nation Building and foster enriching relationship with its members, government and public at large.