Abstract
India was a formal British colony from 1858 to 1947 and during this period British imperial policy significantly impacted upon India and her population. The achievement of political independence in 1947 heralded the implementation of new Indian social, political, legal and economic systems. Although there was little direct involvement by Britain once the transfer of power had been completed, an indirect British influence remained, exemplified by the retention of many British institutions such as the parliamentary system and the legal system, and suggesting that British models functioned as templates for India even after the cessation of formal empire.
Nehru, the first Indian prime minister, a western educated Fabian socialist influenced by central planning in Russia, introduced a mixed economy to India, in which there was a role for both private and public enterprise and in which socialist ideals operated within a secular democracy. The key elements of the mixed economic system included central planning of the economy, the development of a large public sector, control and licensing of private enterprise, price control within the private sector, the use of import substituting policies, the introduction of a predominantly public financial sector with nationalised banking and insurance, state control of foreign investment, protective tariffs and prohibition of imports. These were implemented using legislation promulgated by Parliament, government resolutions and ordinances and government bodies (Panikkar 1974, Spear 1978, Kumar 1982, Kulke and Rothermund 1990, Rothermund 1993, Brass 1994, Brown 1994).
This early period of independence (1949-1955) was also an important time for the accounting profession in India with the establishment of the Institute of Chartered Accountants of India (ICAI), an institution that is still important in the regulation of accounting today. This chapter sets out to explore the remnant influence of imperialism on the establishment of the ICAI in post independence India. It will focus on the involvement of the State in the development of the profession, credentialism and the importance of the ‘chartered accountant’ designation, mutual recognition and reciprocity. In addition, the enduring impact of imperial links on the policy decisions of both the Indian accounting profession and the new Indian Government are highlighted.
In the context of historical studies of accounting professions in post-colonial states, India is important for several reasons. It was hugely important for Britain in trading terms, providing many natural resources to Britain as well as becoming an important market for British goods, for example cotton, spinning machines and iron and steel (Tomlinson 1978, 1993; Misra 1999). In addition, it was important to Britain in times of crisis; for example, providing military support to Britain during the two world wars. It was also one of the first countries to gain independence from Britain after the Second World War, and the path of professionalization here exhibited some interesting features, falling between the professionalization models commonly to be found in the settler and non-settler post- colonial states. Today, India is the largest secular democracy in the world and is becoming increasingly important in economic terms.
Kapadia, the first ICAI President, undertook a major historical study of the professionalization of accounting in India in 1972. This chapter extends the work of Kapadia and draws from a more recent comprehensive study (Verma 2000) of the professionalization process in India to identify the factors influencing the establishment of the ICAI. The chapter is organised into three time periods which cover three very different stages in the development of the ICAI: in the pre-1945 period, we see the antecedents to the establishment of the ICAI; between 1946 and 1949, we see the establishment of the ICAI; and in the period 1949-1955 we see the early operation of the institute and the involvement of government in the activities of the ICAI post independence.
Nehru, the first Indian prime minister, a western educated Fabian socialist influenced by central planning in Russia, introduced a mixed economy to India, in which there was a role for both private and public enterprise and in which socialist ideals operated within a secular democracy. The key elements of the mixed economic system included central planning of the economy, the development of a large public sector, control and licensing of private enterprise, price control within the private sector, the use of import substituting policies, the introduction of a predominantly public financial sector with nationalised banking and insurance, state control of foreign investment, protective tariffs and prohibition of imports. These were implemented using legislation promulgated by Parliament, government resolutions and ordinances and government bodies (Panikkar 1974, Spear 1978, Kumar 1982, Kulke and Rothermund 1990, Rothermund 1993, Brass 1994, Brown 1994).
This early period of independence (1949-1955) was also an important time for the accounting profession in India with the establishment of the Institute of Chartered Accountants of India (ICAI), an institution that is still important in the regulation of accounting today. This chapter sets out to explore the remnant influence of imperialism on the establishment of the ICAI in post independence India. It will focus on the involvement of the State in the development of the profession, credentialism and the importance of the ‘chartered accountant’ designation, mutual recognition and reciprocity. In addition, the enduring impact of imperial links on the policy decisions of both the Indian accounting profession and the new Indian Government are highlighted.
In the context of historical studies of accounting professions in post-colonial states, India is important for several reasons. It was hugely important for Britain in trading terms, providing many natural resources to Britain as well as becoming an important market for British goods, for example cotton, spinning machines and iron and steel (Tomlinson 1978, 1993; Misra 1999). In addition, it was important to Britain in times of crisis; for example, providing military support to Britain during the two world wars. It was also one of the first countries to gain independence from Britain after the Second World War, and the path of professionalization here exhibited some interesting features, falling between the professionalization models commonly to be found in the settler and non-settler post- colonial states. Today, India is the largest secular democracy in the world and is becoming increasingly important in economic terms.
Kapadia, the first ICAI President, undertook a major historical study of the professionalization of accounting in India in 1972. This chapter extends the work of Kapadia and draws from a more recent comprehensive study (Verma 2000) of the professionalization process in India to identify the factors influencing the establishment of the ICAI. The chapter is organised into three time periods which cover three very different stages in the development of the ICAI: in the pre-1945 period, we see the antecedents to the establishment of the ICAI; between 1946 and 1949, we see the establishment of the ICAI; and in the period 1949-1955 we see the early operation of the institute and the involvement of government in the activities of the ICAI post independence.
Original language | English |
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Title of host publication | Accountancy and Empire |
Subtitle of host publication | The British Legacy of Professional Organization |
Editors | Chris Poullaos, Suki Sian |
Place of Publication | New York, Abingdon |
Publisher | Routledge |
Edition | New Works in Accounting History |
ISBN (Electronic) | 13-978-0-203-85154-8 |
ISBN (Print) | 13:978-0-415-45771-2 |
Publication status | Published - 2010 |