Institute of Chartered Accountants of India probing a central council member

NEW DELHI: Accounting regulator Institute of Chartered Accountants of India is dealing with a potentially unsavoury controversy after it emerged that a company owned by an elected member of its central council has been receiving payments from its Pune branch for two years. Members of the council, the highest decision-making body of the institute, should not benefit from the activities of ICAI.

The controversy stems from a decision of the Pune branch of ICAI to outsource a seven-day orientation programme all CA students are required to go through. Zaware Professional Academy was one of the four entities that were selected to do this, and the school's managing director, SB Zaware, became a central council member soon after. Since February 2009 till mid-September, when the Pune branch suspended the arrangement following a complaint, Zaware's company received payments from ICAI, while he served as a member of its central council.

"I'm ascertaining the facts of the matter. I have asked the Pune branch for details and we have also asked Mr Zaware to explain," ICAI president G Ramaswamy said.

Zaware told ET that he did not receive any payments from ICAI and it was his company that did. He didn't think that amounted to a conflict of interest. "The contract was signed before I became a council member. There is no conflict of interest," he said. Zaware said his company has received 11.68 lakh from the orientation activity since the beginning of the arrangement.