Due dates and it’s extension saga for CA’s. Is there any solution for it.

Dear friends,

Every year the return dates come near and the talk for extension starts in our ca faternity. Why every year the is the talk. What is the reason and is there any solution to this never ending saga.

Below mentioned are the views expressed by CA Rushabh Mania on his linked in page. I found it quite interesting and have been of more or less of similar views, so posting it.

Story of due dates and their extension

Just like any other year, yet again, the due dates are requested to be extended by tax practitioners and Chartered Accountants. This is not an isolated incident, but request for extension of due dates has been consistent for years, whether it be tax audit, VAT audit or even a return filing dates.

The reasons that are often given for this request are also more or less similar – late release of modified forms by government, technical glitches on website, other compliance responsibilities (especially in new laws like GST and RERA). The alleged issues are of such a significance that the Institute of Chartered Accountant’s of India has itself stated in its representation that to the CBDT that the “CA office are working overtime” and that they are “unable to cope up”.

While the reasons may be genuine, it is not the first time that these issues are faced by Chartered Accountants. The Government can be blamed for much of the problem; however, it is also the time when practitioners introspect. The reasons cited this time might be temporary, but the inherent issues persist. It is high time that the practitioners identify and address these inherent issues – ineffective outsourcing strategies, shortage of trained manpower resources, outdated technology, and so on.

Sustainable solutions

– Outsourcing

When the senior practitioners are working seven days a week in peak seasons, it is often observed that young practitioners have the bandwidth to accommodate more work. Therefore, it is important to develop the mutually acceptable outsourcing strategies, to overcome market inefficiencies. One of the important points to consider in outsourcing strategies is giving a sense of client ownership to outsourced young practitioners i.e. delegating a client rather than delegating the work. Off-late more and more Chartered Accountants are entering into the practice area leaving a corporate job waiting for them and one of the very significant reasons for this is the willingness to have control over their work and clients. Therefore, the sustainable way of outsourcing strategy for senior practitioner seems to be giving the sense of control to them over the client rather than hiring them for an assignment.

Capacity building

Moreover, despite of the increase in workload and consequent inability to cope up with due date pressure almost all the time, practitioners are reluctant to enhance their resources by scaling up, as it entails increase in fixed cost. Hiring new people, renting more space, investing in technology are few measures to enhance capacity which should be considered to deliver timely and quality service. Also, the training of personnel is of paramount importance in this dynamic environment of ever changing laws. Indian practitioners need to learn this fact from the Big4 firms who invest heavily in different training programs. These measures will have a cumulative effect of practitioners being able to manage their work effectively and meet due dates.

Way forward

It is pertinent to note that when the businesses worldwide (especially Scandinavian countries) are yielding positive results for 32 hours (4 days * 8 hrs) a week plan for their employees, the Indian CA firms are acting regressively by increasing the number of working hours per week. Interestingly though, this is not due to shortage of CAs but due to uneven distribution of work, inefficient allocation and lack of flexibility in the practice area. Therefore, it is important to proactively take steps to adopt Scandinavian work culture instead of Japanese work culture of 12 hours a day which is unsustainable. This will ensure better work-life balance of practitioners & their staff.

Written by
Rushabh Mamania
Chartered Accountant
His article link
https://www.linkedin.com/pulse/solving-y-why-due-date-equation-rushabh-mamania

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