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Sejal asked 4 months ago

Sir,please explain this case,what will be it’s solution?:-
A Chartered accountant approached the principal of a secondary school through a 3rd person known to the principal for his appointment as auditor of that school. Further,the CA misrepresented to the previous auditor that he had been offered appointment as auditor of the school & enquired whether he had any objection to his accepting the same though it was a fact that the appointment of CA was not made.

4 Answers
RaviRavi Staff answered 4 months ago

Please share exact question and its source. I want to understand whole case.
Cl 6 has clarification that, if CA in practice “A” is introduced to principal of school by other ca in practice “B” and if in such case “A” gets offer of work from school then it will be considered work emanating (coming) from contact of other ca in practice “B”, in such case “A” need to ensure “B” is informed about such proposal, he should be kept in loop, so that things dont happen behind his back and if there is anything objectionable he should communicate with “A”. If “B” is not informed it will be professional misconduct. 
 

RaviRavi Staff answered 4 months ago

Further soliciting work directly or indirectly is not allowed under clause 6
Lying to previous auditor is not covered any where can be covered under other misconduct. 

RaviRavi Staff answered 4 months ago

its old case of 1973 following is text
Approaching through third person for appointment as Auditor
1.1.6(42) A Chartered Accountant approached the Principal of a Secondary school through a third person known to the Principal for his appointment as auditor of that school. Further, the Chartered Accountant misrepresented to the previous Auditor that he had
been offered appointment as Auditor of the School and enquired whether he had any objection to his accepting the same though it
was a fact that the appointment of Chartered Accountant was not made.


Held, the Chartered Accountant was guilty of professional misconduct under the clause. It was further held that writing letter by the Chartered Accountant to the previous auditor offering his services to audit the accounts of School was not wrong as it was an offer to a professional colleague and not to a prospective client.


(M.L. Agarwal in Re: – Page 1033 of Vol. IV of the Disciplinary Cases-decided on 16th and 17th February, 1973).
 
 

RaviRavi Staff answered 4 months ago

because it is indirect solicitation and hence it is considered as misconduct under clause 6
further case and solution doesn’t match a point, question or case says communication with previous auditor was to ask for NOC but answer says he was just asking work from previous auditor, so there is little ambiguity. 
 

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