Centre gets into the Act to create desi 'Big Fours'
domestic accounting firms to merge and acquire scale. The government is of the view this will help create large domestic audit firms akin to the Big Four, people aware of the development said.
The Ministry of Corporate Affairs (MCA) could outline some details as part of the new government's 100-day agenda, one of them said. The LLP law and the Companies Act could be amended in the winter session of Parliament, likely to be held in December, he added.
The ministry is also engaged in talks with the Institute of Chartered Accountants of India (ICAI), which has decided to relax key provisions in its regulatory framework to facilitate the "aggregation of chartered accountant firms," the person said.
«If more firms join hands, they will acquire the size, scale and competence required to conduct accounting or audit work of large conglomerates,» said one of the persons cited.
He said the government is in the process of identifying the provisions of the LLP Act that need to be amended. Those pertaining to beneficial interest of partners in such entities could be reviewed. A clearer picture, however, could emerge by the end of this month.
Two crucial steps
The ICAI has reviewed its merger and demerger guidelines for firms and taken two crucial steps to facilitate such aggregations, its president Ranjeet Kumar Agarwal told ET.
Accounting firms wishing to merge will now have up to 10 years, instead of the current five, to separate if things don't go according to plan. «Upon parting ways within 10 years, they will be able
