Ca Ordinance

THE INSTITUTE OF CHARTERED ACCOUNTANTS OF PAKISTAN

MEMBERS' HANDBOOK

VOLUME I

Containing: Part-I Part-II

Ordinance Bye-Laws

THE INSTITUTE OF CHARTERED ACCOUNTANTS OF PAKISTAN

MEMBERS' HANDBOOK

VOLUME I

Containing: Part-I Part-II

Ordinance Bye-Laws

MEMBERS' HANDBOOK Volume -1 Part I Part II

Chartered Accountants Ordinance, 1961 (X of 1961) Chartered Accountants Bye-Laws, 1983

PART I

CHARTERED ACCOUNTANTS ORDINANCE, 1961 (X OF 1961)

AS AMENDED UP TO JUNE, 1983

CHARTERED ACCOUNTANTS ORDINANCE, 1961 (X OF 1961) AS AMENDED UP TO JUNE, 1983 CONTENTS CHAPTER I PRELIMINARY Section 1. Short title, extent and commencement 2. Definitions

Page 1 1

CHAPTER II THE INSTITUTE OF CHARTERED ACCOUNTANTS OF PAKISTAN 3. 4. 5. 6. 7. 8.

Incorporation of the Institute Entry of names in Register Associates and Fellows Certificate of Practice Members to be known as Chartered Accountants Disabilities

3 3 4 5 6 6

CHAPTER III COUNCIL OF THE INSTITUTE 9. 10. 11. 12. 13. 14. 15. 16. 17.

Constitution of the Council of the Institute Mode of election to the Council Nomination in default of election President and Vice-President or Vice-Presidents Resignation of membership and casual vacancies Duration and dissolution of Council Functions of the Council Staff, remuneration and allowances Finances of the Institute

7 8 9 9 10 10 11 12 12

CHAPTER IV REGISTER OF MEMBERS 18. 19.

Register Removal from the Register

13 13

CHAPTER V REGIONAL COMMITTEES 20.

Constitution and functions of regional Committees

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CHAPTER VA MISCONDUCT 20A. 20B. 20C. 20D. 20E. 20F. 20G. 20H. 201. 20J. 20K.

Facts, etc. to be laid before the Investigation Committee Enquiry by the Investigation Committee Member or student not found guilty Orders by the Council if member found guilty Orders by the Council if student found guilty Hearing of case by the High Court Effect of inquiry Council and Investigation Committee to have powers of Civil Court Publication of findings and decisions Return of Certificate Appeal and revision

15 15 16 17 18 18 18 19 19 19 20

CHAPTER VI PENALTIES 21. 22. 23. 24. 25.

Penalty for falsely claiming to be a member, etc. Penalty for using name of the Council, awarding degree of Chartered Accountancy, etc. Companies not to engage in accountancy Unqualified persons not to sign documents Sanction to prosecute

21 21 22 22 22

CHAPTER VII MISCELLANEOUS 26. 27. 28. 29.

Maintenance of branch offices Powers to make bye-laws Powers of Federal Government to direct bye-laws to be made or to make or amend bye-laws References to registered accountants, etc. to be construed as references to chartered accountants

23 23 25 25

30. 31.

Amendment to section 144 of the Companies Act, 1913 (VII of 1913) Savings

26 26

SCHEDULES Schedule I Part 1 – Professional misconduct in relation to chartered accountants in practice

27

Part 2 – Professional misconduct in relation to members engaged in management consultancy

32

Part 3 – Professional misconduct in relation to members of the Institute in service

35

Part 4 – Professional misconduct in relation to members of the Institute generally

35

Schedule II Part 1 – Professional misconduct in relation to chartered accountants in practice requiring action by a High Court

36

Part 2 – Professional misconduct in relation to members engaged in management consultancy requiring action by a High Court

37

Schedule III Professional misconduct in relation to the students of the Institute

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THE CHARTERED ACCOUNTANTS ORDINANCE, 1961* (X OF 1961) AN ORDINANCE to make provision for the regulation of the professional Accountants WHEREAS it is expedient to make provision for the regulation of the profession of accountants and for that purpose to establish an Institute of Chartered Accountants: Now, THEREFORE, in pursuance of the Proclamation of the seventh day of October, 1958 and in exercise of all powers enabling him in that behalf the President is pleased to make and promulgate the following Ordinance:CHAPTER I PRELIMINARY 1.

Short title, extend and commencement.- (1) This Ordinance my be called the Chartered Accountants Ordinance, 1961. (2) It extends to the whole of Pakistan ** [and shall apply to all members, wherever they may be.] (3) It shall come into force on such date as the Federal Government may, by notification in the official Gazette, appoint in this behalf.

2.

Definitions.- (1) In this Ordinance, unless there is any thing repugnant in the subject or context:(a) "Associate" means an associate member of the Institute; (b) "chartered accountant" means a person who is a member of the Institute; (c) ''Council''' means the Council of the Institute ***[(cc) 'fellow" means a fellow member of the Institute;]

_______________________________________________________________ *This Ordinance received the assent of the President on 3"'March, 1961 and was published in Part 1 of the Gazette of Pakistan Extraordinary dated the 10th March, 1961. **Added by section 2 of Chartered Accountants (Amendment) Ordinance, 1983. ***Inserted by Section 3 (a) (i) of Chartered Accountants (Amendment) Ordinance, 1983.

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(d) "Institute" means the Institute of Chartered Accountants of Pakistan constituted under this Ordinance; (e) "prescribed" means prescribed by the bye-laws of the Institute; (f) "Register" means the Register of the Members of the Institute maintained under this Ordinance; (g) "registered accountants" means any person who has been enrolled on the Register of Accountants maintained by the Federal Government under the Auditors' Certificates Rules, 1950. * [(gg) “student” means a person who is or has been trainee under a training contract with a member of the Institute entitled to train students under this Ordinance and the bye-laws made there under, and has not successfully completed the examinations of the Institute;] and (h) "year" means the period commencing on the first day of July of any year and ending on the thirtieth day of June of the succeeding year. (2) A member of the Institute shall be deemed "to be in practice" when individually or in partnership with chartered accountants in practice, he, in consideration received or to be received(i) engages himself in the Practice of accountancy, or (ii) offers to perform or performs services involving the auditing, or verification of financial transactions, books, accounts, or records or the preparation verification or certification of financial accounting and related statements or holds himself, out to the public as an accountant; or (iii) renders professional services or assistance in or about matters of principle or detail relating to accounting procedure or the recording, presentation or certification of financial facts or data; or (iv) renders such other services as, in the opinion of the Council, are or may be rendered by a chartered accountant in practice; and the words "to be in practice" with their grammatical variations and cognate expressions shall be construed accordingly. _____________________________________________________________ * Inserted by Section 3 (a) (ii) of the Chartered Accountants (Amendment) Ordinance, 1983

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Explanation - An associate or a fellow of the Institute who is a salaried employee of a chartered accountant in practice or a firm of such chartered accountants shall, notwithstanding such employment, be deemed to be in practice for the limited purpose of the training of (students)*. CHAPTER II

3.

THE INSTITUTE OF CHARTERED ACCOUNTANTS OF PAKISTAN Incorporation of the Institute.- (1) All persons whose names are entered in the Register at the commencement of this Ordinance and all persons who may hereafter have their names entered in the Register under provisions of this Ordinance, so long as they continue to have their names borne on the said Register, are hereby constituted a body corporate by the name of the Institute of Chartered Accountants of Pakistan, and all such persons shall be known as members of the Institute. (2) The Institute shall have perpetual succession and a common seal and shall have power to acquire, hold and dispose of property, both movable and immovable, and shall by its name sue and be sued.

4.

Entry of names in Register.- (1) Any of the following persons* shall be entitled to have his name entered in the Register, namely:(i)

any person who is registered accountant at the commencement of this Ordinance;

(ii)

any person who has passed such examination and completed such training as may be prescribed;

(iii) any person who has passed such other examination and completed such other training outside Pakistan as is recognized by the Federal Government or the Council with the approval of the Federal Government as being equivalent to the examination and training prescribed for members of the Institute: ** [Provided that, in the case of any such person, the Council may, with the approval of the Federal Government, impose such conditions as it may deem fit.] _____________________________________________________________ *Substituted for the words 'articled clerks' by section 3 (b) of the Chartered Accountants (Amendment) Ordinance, 1983. **Substituted for the proviso reproduced below by Section 4 of the Chartered Accountants (Amendment) Ordinance, 1983. “Provided that in the case of any person who is not permanently residing in Pakistan the Federal Government or the Council with the approval of the Federal Government, as the case may be, may impose such further conditions as it may deem fit.”

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(iv)

any person domiciled in Pakistan, who at the commencement of this Ordinance is studying for any foreign examination and is at the same time undergoing training, whether within or without Pakistan, or who, having passed such foreign examination, is at the commencement of this Ordinance undergoing training whether within or without Pakistan: Provided that any such examination or training was recognized before the commencement of this Ordinance for the purpose of conferring the right to be registered as an accountant under the Auditors Certificates Rules. 1950, and provided further that such person passes the examination or completes training.

(2)

The name of every person belonging to the class mentioned in clause (i) of sub-section (1) shall be entered in the Register without the payment of any entrance fee or any application being made in that behalf and shall, for the purpose of sub-section (1) of section 3, be deemed to have been so entered at the commencement of this Ordinance.

(3)

Every person belonging to any of the classes mentioned in clauses (ii), (iii) and (iv) of sub-section (1) shall have his name entered in the Register on application being made and granted in the prescribed manner and on payment of the prescribed fee, which shall not exceed rupees five hundred in any case.

(4) The Federal Government shall take such steps as may be necessary for the purpose of having the names of all persons belonging to the class mentioned in clause (i) of sub-section (1) entered in the Register. 5.

Associates and Fellows.- (1) The members of the Institute shall be of two classes designated respectively as associates and fellows. (2)

Every person shall, on his name being entered in the Register, become an associate member of the Institute and be entitled to use the letters ACA after his name to indicate that he is an associate member of the Institute of Chartered Accountants. 4

*(3)

[An associate member who has been in practice for at least five years or an associate member of the Institute for a period of not less than ten years shall, on payment of the prescribed fee, have his name transferred to the Register of Fellows, of the Institute, and on having his transferred to the Register of Fellows, he shall be entitled to use the letters F.C. A after his name to indicate that he is a fellow member of the Institute.

Explanation:- For the purpose of this sub-section, two years as a nonpracticing associate shall be counted as one year of practice of such associate. 6.

Certificate of practice.- (1) No member of the Institute shall be entitled to practice as an auditor of a public company as defined in the Companies Act, 1913 (VII of 1913), unless he has obtained from the Council a certificate of practice: * [ ............. ............................................................................... ]

_____________________________________________________________ *Substituted for sub-Section 3 of Section 5, reproduced below, by the Chartered Accountants (Amendment) Ordinance, 1983. “(3) A member, being an associate who has been in continuous practice in Pakistan for at least five years, whether before or after the commencement of this Ordinance, or whether partly before and partly after the commencement of this ordinance, and a member who has been a registered accountant or an associate for a continuous period of not less than ten years whether before or after the commencement of this Ordinance or whether partly before and partly after the commencement of this Ordinance shall, on payment of the prescribed entrance fee, which shall not exceed rupees five hundred in any case, and on an application made and granted in the prescribed manner, have his name entered in the Register as a fellow of the Institute and shall be entitled to use the letters F.C.A. after his name to indicate that he is a fellow of the Institute of Chartered Accountants.” “Explanation:- For the purpose of this sub-section two years as a non-practicing registered accountant or as non-practicing associate shall be counted as one year of practice of such registered accountants or associate” *Proviso reproduced below deleted by section 6 of the Chartered Accountants (Amendment) Ordinance, 1983. “Provided that nothing contained in this sub-section shall apply to person who, immediately before the commencement of this Ordinance, has been in practice as registered accountant until one month has elapsed from the date of the first meeting of the Council.”

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(2) Every such member shall pay such annual fee for his certificate as may be prescribed, and such fee shall be due on the first day of July in each year. 7.

Members to be known as Chartered Accountants.- Every member of the Institute in practice and any other member may, use the designation of a Chartered Accountant and no member using such designation shall use any other designation, whether in addition thereto or in substitution therefore: Provided that nothing contained in this section shall be deemed to prohibit any such person from adding any other description or designatory letters to his name, if entitled thereto, to indicate membership of such other institute of accountancy, whether in Pakistan or elsewhere as may be recognized in this behalf by the Council, or any other qualification that he may possess, or to behalf by the Council, or any other qualification that he may possess, or to prohibit a firm, all the partners of which are members of the Institute and in practice, from being known by its firm name as Chartered Accountants.

8.

Disabilities.- Notwithstanding anything contained in section 4, a person shall not be entitled to have his name entered in or borne on the Register if hei) has not attained the age of twenty-one years at the time of his application for the entry of his name in the Register; or (ii) is of unsound mind and stands so adjudged by a competent Court; or (iii) is an undercharged insolvent; or (iv) having been discharged of insolvency, has not obtained from the Court a certificate stating that his insolvency was caused by misfortune without any misconduct on his part or has been convicted by a competent Court, whether within or without Pakistan of an offence involving moral turpitude and punishable with transportation or imprisonment or of an offence, not of a technical nature, committed by him in his professional capacity unless technical nature, committed by him in his professional capacity unless in respect of the offence committed he has either been granted a pardon or, on an application made by him in this behalf, the Federal Government has, by an order in writing, removed the disability; or

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(vi) has been removed from the membership of the Institute on being found on inquiry to have been guilty of such professional or other misconduct, as may be prescribed: Provided that a person who has been removed from the membership of the Institute for a specified period, shall be entitled to have his name entered in the Register after the expiry of such period. CHAPTER III COUNCIL OF THE INSTITUTE 9.

Constitution of the Council of the Institute.- (1) There shall be a Council of the Institute for the management of the affairs of the Institute and for discharging the functions assigned to it under this Ordinance. (2) The Council shall be composed of the following persons, namely*(a)[the prescribed number of persons, not being less than twelve, elected from the two prescribed regional constituencies by the

______________________________________________________________ *Substituted for clause (a) and (b) of sub-section (2) of Section 9, reproduced below, by clause (a) of Section 7 of the Chartered Accountants (Amendment) Ordinance, 1983:“(a) the prescribed number of persons, not being less than six, elected from the three regional constituencies to be specified by the Federal Government, by notification in the official Gazette, by the members of the Institute belonging to such constituencies from among such members of at least three years standing, the number of members to be elected from a constituency being such as may be fixed therefore by the Federal Government, and (b) not less than seven persons nominated by the Federal Government of whom not less than three shall be qualified accountants representing each of the said regional constituencies. Explanation:- In computing the period of a persons’ standing with the Institute for purposes of clause (a), the period for which he has been a registered accountants before the commencement of this Ordinance shall be reckoned as period of membership of the Institute.”

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members of the Institute belonging to such constituencies from among such members of at least five years' standing, the number of members to be elected from each such constituency being such as may be prescribed: Provided that each such regional Constituency shall consist of two zones, to be known as Zone “A” and Zone “B” having the prescribed limits: Provided further that at least one member shall be elected from each of the aforesaid Zones; and (b) not more than four persons nominated by the Federal Government.] 10.

Mode of election of the Council.- (1) Elections under clause (a) of sub-section (2) of Section 9 shall be conducted in the prescribed manner. ** [2] Where any dispute arises regarding any such election, the matter shall be referred by the Council to a Tribunal appointed by the President of the Council in this behalf and the decision of such Tribunal shall be final: Provided that in case the President of the Council in office is himself a party to such dispute or is unwilling to make such appointment, the immediate past President of the Council shall appoint the Tribunal: Provided further that no such reference shall be made except on an application made to the Council by an aggrieved party, within thirty days from the date of the declaration of the result of the Election.]

(3) The expenses of the Tribunal shall be borne by the Institute. _______________________________________________________________ * Deleted sub-section 3 of section 9 reproduced below by clause (b) of section 7 of the Chartered Accountants (Amendment) Ordinance, 1983. “(3) Notwithstanding any thing contained in sub-section (2) all the members of the first Council to be constituted under this Ordinance shall be nominated by the Federal Government.” **Substituted sub-section (2) of Section 10 reproduced below by the Section 8 of the Chartered Accountants (Amendment) Ordinance, 1983. “(2) where any dispute arises regarding any such election, the matter shall be referred by the Council to a Tribunal appointed by the Federal Government in this behalf and the decision of such Tribunal shall be final:Provided that no such reference shall be made except on an application made to the Council by an aggrieved party within days from date of the declaration of the result of the election.”

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*11.

Nomination in default of election.- (1) If the members of the Institute referred to in clause (a) of sub-section (2) of section 9 fail to elect the required number of members which they are empowered under that section to elect from a zone of a constituency, the members declared elected from that zone shall nominate the number of members not elected who shall be deemed to be members of the Council as if they had been duly elected. (2) Where the members of the Institute referred to in clause (a) of subsection (2) of section 9 do not at all elect any member, the Council shall nominate the required number of members from the respective regional constituencies and such members shall be deemed to be the members of the Council as if they had been duly elected.

12.

President and Vice President or Vice-Presidents.- (1) The Council shall elect from among its members a President and one or, if the Council so decides, two Vice-Presidents of the Institute, who shall also be the President and Vice-President or Vice Presidents of the Council respectively and so often as the office or offices of the President or the Vice-President or Vice-Presidents become vacant, the Council shall choose from among its members a President or a VicePresident or vice-Presidents, as the case may be: **[ ..............................................] (2) The President shall be the chief executive authority of the Council,

(3) The President and the Vice-President or Vice-Presidents shall hold office for a period of one year from the date on which they are chosen but so as not to extend beyond their term of office as members of the Council, and, subject to their being members of the Council at the relevant time, they shall be eligible for re-election for a total period not exceeding three consecutive years. ____________________________________________________________ *Section 11 reproduced below Substituted by Section 9 of the Chartered Accountants (Amendment) Ordinance, 1983. ** 11. Nomination in default of election.- if any body of persons referred to in section 9 fails to elect any of the members of the Council which it is empowered under that section to elect, the Federal Government may nominate a person duly qualified to fill the vacancy, and any person so nominated shall be deemed to be a member of the Council as if he had been duly elected." **Proviso reproduced below deleted by clause (a) of Section 10 of the Chartered Accountants (Amendment) Ordinance, 1983. “Provided that on the first constitution of the Council, members of the Council nominated in this behalf by the Federal Government shall discharge the functions of the President and the Vice-President for the term of the first Council.”

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*Provided that, notwithstanding the expiry of the term of their office, the President and the Vice-President or VicePresidents of the Council, shall continue to hold office till such time as their successors are elected. (4)

13.

On the dissolution of the Council, the President of the Council at the time of such dissolution shall continue to hold office and discharge such administrative and other duties as may be prescribed until such time as a new President shall have been elected and shall have taken over charge of his duties.

Resignation of membership and casual vacancies.- (1) Any member of the Council may at any time resign his membership by writing under his hand addressed to the President and the seat of such member shall become vacant when such resignation is notified in the official Gazette. (2) A member of the Council shall be deemed to have vacated his seat if he is declared by the Council to have been absent without sufficient excuse from three consecutive meetings of the Council, or if his name is, for any cause, removed from the Register under the provisions of section 19. (3) A casual vacancy in the Council shall be filled by fresh election from the constituency concerned or by nomination by the Federal Government, as the case may be, and the person elected or nominated to fill the vacancy shall hold office until the dissolution of the Council. Provided that no election shall be held to fill a casual vacancy occurring within six months prior to the date of the expiry of the duration of the Council but such a vacancy may be filled by nomination by the **[Council.] (4) No act done by the Council shall be called in question on the ground merely of the existence of any vacancy in, or defect in the constitution of, the Council.

14.

Duration and dissolution of Council.- (1) The duration of the Council constituted under this Ordinance shall be ***['four'] years from the date of the first meeting of the Council on the expiry of which it shall stand dissolved and a new Council constituted in accordance with the provisions of this Ordinance.

_____________________________________________________________ *Inserted by clause (b) of Section 10 of the Chartered Accountants (Amendment) Ordinance. 1983. ** Substituted for the words Federal Government after consultation with the President of the Council by Section 1 I of the Chartered Accountants {Amendment Ordinance, 1983. *** substituted for the word "three"' by clause (a) of Section 12 of the Chartered Accountants (Amendment) Ordinance, 1983.

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*Provided that the duration of the Council existing immediately before the commencement of the Chartered Accountants (Amendment) Ordinance, 1983, shall be three years. (2) Notwithstanding the expiry of the duration of the Council it shall continue to function until a new Council is constituted in accordance with the provisions of this Ordinance and upon such constitution, the Council so functioning shall stand dissolved. 15.

Functions of the Council.- (1) The duty of carrying out the provisions of the Ordinance shall be vested in the Council. (2) In particular, and without prejudice to the generally of the foregoing provisions the **[functions] of the Council shall include. (a) the examination of candidates for enrolment and the prescribing of fees therefore; (b) the regulation of the engagement and training of ***[students] (c) the prescribing of qualifications for entry in the Register; (d) the recognition of the foreign qualifications and training for purposes of enrolment; (e) the granting or refusal of certificates of practice under this Ordinance; (f) the maintenance and publication of a register of persons qualified to practice as chartered accountants; (g) the levy and collection of fees from members, examinees and other persons; (h) the removal of names from the Register and the restoration to the Register of names which have been removed; (i) the regulation and maintenance of the status and standard of professional qualifications of the members of the Institute;

(j) the carrying out, by financial assistance to persons other than members of the Council or in any other manner, of research in accountancy. _____________________________________________________________ *Inserted by clause (b) of Section 12 of the Chartered Accountants (Amendment) Ordinance, 1983. *'* Substituted for the word "duties by clause (a) of Section 13 of the Chartered Accountants (Amendment) Ordinance, 1983. *** Substituted for the words "articled and audit clerks" by clause (b) of Section 13 of the Chartered Accountants (Amendment) Ordinance. 1983.

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(k) The maintenance of a library and publication of books and periodicals relating to accountancy. (1) The exercise of such disciplinary power over the members and servants of the Institute as may be prescribed. (m) The formation of such Standing Committees as may be prescribed; and *(mm) the constitution of an Investigation Committee consisting of such members as may be prescribed; (n) such other powers as may be conferred on the Council by the Federal Government. 16.

Staff, remuneration and allowances.- For the efficient performance of its duties, the Council may(a) appoint a full-time Secretary who may also, if so decided by the Council, act as Treasurer; (b) appoint such other officers and servants as it deems necessary; (c) require and take from the Secretary or from any other officer or servant of the Council such security for the due performance of his duties, as the Council considers necessary; (d) fix salaries, fees, allowances and other conditions of service of the officers and servants of the Council; (e) with the previous sanction of the Federal Government, fix the allowances of the President, Vice-President or Vice-Presidents and other members of the Council and members of its Committees.

17.

Finances of the.-**[Institute-] There shall be established a fund under the management and control of the Council into which shall be paid all monies received by the *** [Institute] and out of which shall be met all expenses and liabilities properly incurred by the *** [Institute]. _______________________________________________________________ *Added by clause (c) of Section 13 of the Chartered Accountants (Amendment) Ordinance, 1983. ** Substituted for the word "Council" by clause (a) of Section 14 of the Chartered Accountants (Amendment) Ordinance, 1983. *** Substituted for the word "Council" by clause (b) of Section 14 of the Chartered Accountants (Amendment) Ordinance, 1983.

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CHAPTER IV REGISTER OF MEMBERS 18.

Register.- (1) The Council shall maintain in the prescribed manner a Register of the Members of the Institute. (2) The Register shall include the following particulars about every member of the Institute, namely.(a) his full name date of birth, domicile, residential and professional address; (b) the date on which his name is entered in the Register; (c) his qualifications; (d) whether he holds a certificate of practice; and (e) any other particulars which may be prescribed. (3) The Council shall cause to be published, in such manner as may be prescribed, a list of members of the Institute as on the first day of July of each year, and shall, if requested to do so by any such members, send to him a copy of such list. (4) Every member of the Institute shall, on his name being entered on the Register pay such annual membership fee, as may be prescribed and different fees may be prescribed for associates and for fellows.

19.

Removal from the Register.- (1) The Council may remove from the Register the name of any member of the Institute(a) who is dead; or (b) from whom a request has been received to that effect; or (c) who has not paid any prescribed fee required to be paid by him; or (d) who is found to have been subject at the time when his name was entered in the Register, or who at anytime thereafter has become subject, to any of the disabilities mentioned in section 8, or who for any other reason has ceased to be entitled to have his name borne on the Register, *[or] _______________________________________________________ * Added by clause (a) of Section 15 of the Chartered Accountants (Amendment) Ordinance, 1983.

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*(e) against whom an order has been passed under this Ordinance removing him from the membership of the Institute. **(2) The Council may, on an application made to it by a person whose name has been removed from the Register for a specified period restore his name if he is otherwise eligible to such membership; Provided that he shall have paid before such restoration the admission fee for the year during which his name is restored, and if his name has been removed under clause (b) or clause (c) of sub-section (1), all arrears on account of annual membership fee subject to maximum of five years of annual membership fee according to the scale applicable to him. (3) The restoration of the name of a member shall be notified in the official Gazette and in such journal or journals as the Council thinks desirable and shall also be communicated in writing to the person concerned. CHAPTER V REGIONAL COMMITTEES 20.

Constitution and functions of Regional Committees.- (1) For the purpose of advising and assisting it on matters concerning its functions, the Council may constitute such Regional Committees as and when it deems fit for one or more of the regional constituencies that may be ***[prescribed] under clause (a) of sub-section (2) of section 9. (2)

The Regional Committees shall be constituted in such manner and exercise functions as may be prescribed.

_______________________________________________________ * Added by clause (a) of Section 15 of the Chartered Accountants (Amendment) Ordinance, 1983. ** Added by clause (b) of Section J5 of the Chartered Accountants (Amendment) Ordinance. 1983. *** Substituted for the word, "specified by the Federal Government, by Section 16 of the Chartered Accountants (Amendment) Ordinance. 1983.

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*CHAPTER VA MISCONDUCT 20A.

Facts, etc., to be laid before the Investigation Committee.- (1) The Secretary of the Institute shall, and any member or any aggrieved person may lay before the Investigation Committee any fact indicating that(a) a member of the Institute has prima facie been guilty of any professional misconduct specified in Schedule I or Schedule II; or (b) a student has prima facie been guilty of any professional misconduct specified in Schedule III. (2) Where a complaint is received by the Institute that any member of the Institute or student is guilty of professional misconduct referred to in sub-section (1), the complaint shall, with relevant and necessary facts, be laid before the Investigation Committee.

20B.

Enquiry by the Investigation Committee.- (1) if on considering the facts or complaint laid before it under section 20A, the Investigation Committee is of opinion that such facts or complaint require investigation, it shall after giving a notice to the member of the Institute or student whose conduct is in question, hold an inquiry.

______________________________________________________________ *Inserted by Section 17 of the Chartered Accountants (Amendment) Ordinance, 1983 for the following chapter in the C.A. Bye-laws 1961. CHAPTER X OF C.A. BYE LAWS, 1961 SUSPENSION, EXCLUSION AND RESTORATION (Procedure in inquiries relating to misconduct of members) 98.

Matter to be laid before Investigation Committee.- ( 1 ) It shall be the duty of the Secretary and the right of any member or of any aggrieved person to lay before the Investigation Committee any fact indicating. (a) that a member has become liable to exclusion, suspension or reprimand under any provision of the Ordinance or these bye-laws; or (b) that an articled clerk or an audit clerk has been guilty of felony or misdemeanour or has been declared by a competent court to have been guilty of fraud or has been guilty of an act of default of such a nature as to render him unfit to become a member of the Institute. (2) Where a complaint has been received by the Institute, the Council or the Secretary, that any member has become liable as aforesaid or that any articled or audit clerk has been guilty as aforesaid, the complaint shall forthwith be laid before the Investigation Committee.

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20C.

(2)

A member of the Institute or a student whose conduct is in question shall be given an opportunity of being heard and, if such member or student so desires, the Investigation Committee shall permit such member or student to be represented before it by a counsel or by a member of the Institute.

(3)

After the conclusion of inquiry, the Investigation Committee shall report the result of the inquiry to the Council.

Member or student not found guilty.- If, on receipt of the report under section 20B, the Council finds that the member of the Institute or student, as the case may be, is not guilty of any professional misconduct, it shall record its finding accordingly and direct that the proceedings or, as the case may be the complaint be filed.

_____________________________________________________________ 99. Duties of the Investigation Committee.- (1) It shall be the duty of the Investigation Committee to consider the facts or complaint laid before it under the provisions of the last preceding bye-law and where it is of the opinion that the facts or compliant require investigation, it shall forthwith give to the member or articled or audit clerk notice of its intention to consider the complaint. The Investigation Committee shall give such member or articled or audit clerk an opportunity of being heard before it and shall, if the member or articled or audit clerk so desires, permit such member or articled or audit clerk to be represented before it by counsel or by solicitor or by a member of the Institute. The Investigation Committee shall thereafter report the result of its inquiry to the Council. (2) The investigation Committee may at the request of any member or articled or audit clerk advise such member or articled or audit clerk in regard to any matter of professional conduct. 100. Duties of the Council (1) If on receipt of such report the Council finds that a formal complaint has not been proved, it shall record its finding accordingly and direct that the proceeding shall be filed or the complaint shall be dismissed as the case may be. (2) If on receipt of such report the Council finds that a formal complaint has been proved it shall record a finding to that effect and shall afford to the member or to the articled or audit clerk, either personally or through council or a solicitor or a member of the institute, an opportunity or being heard before orders are passed against him on the case, and may thereafter make any of the following orders, namely:(a) reprimand the member or articled or audit clerk; or (b) suspend the member from membership for such period, not exceeding five years, as the Council thinks fit: or

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20D. Orders by the Council if member found guilty (1) If, on receipt of the report under section 20B, the Council is of the opinion that the member of the Institute has been guilty of any professional misconduct specified in Schedule 1, it may, after affording such member an opportunity of being heard, either personally or through counsel or another member of the Institute, make any of the following orders, namely:(a) reprimand or warn such member; (b) impose such penalty as it may deem necessary not exceeding one thousand rupees; and (c) remove the name of such member from the Register for a period not exceeding five years: Provided that, where it appears to the Council that the case is one in which the name of such member ought to be removed from the Register for a period exceeding five years or permanently, it shall not make any order but shall refer the case to the High Court with its recommendations thereon. (2) If the Council is of opinion that the member of the Institute is guilty of a professional misconduct specified in Schedule II, it shall refer the case to the High Court with its recommendations thereon. __________________________________________________________________ (c) exclude the member from membership: or (d) direct the cancellation of, or extend the period of articles or service as an audit clerk, or that any period already served under such articles or service or service as an audit clerk shall not be reckoned as such service for the purpose of sub-clause (b) of clause 82 and a person whose articles or service as an audit clerk have been so cancelled under this bye-law shall not, except with the permission of the Council, be retained or taken as an articled or audit clerk by a member of the Institute. (3) Notice of the finding and decision of Council shall forthwith be given to the member or articled or audit clerk concerned and the decision shall thereupon take effect. 101. Publication of finding and decision.- (1) When the Council finds that a formal complaint has been proved it shall cause its finding and decision to be published in the Gazette of Pakistan and in such journals as it shall think desirable and as soon as practicable after such finding and decision are pronounced. The publication shall in all cases include the name of the member or articled or audit clerk concerned unless in a particular case the Council considers that there exist special circumstances which justify the commission of the names from such publication. (2) Where the Council finds that a formal complaint has not been proved me Council may make such publication if any, as in the circumstances of the ease it considers desirable.

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20E.

Orders by the Council if student found guilty- If, on receipt of report under section 20B, the Council is of opinion that the student is guilty of any professional misconduct specified in Schedule III, it shall, after affording such student an opportunity of being heard, either personally or through a counsel or a member of the Institute, make any of the following orders, namely:(a) reprimand or warn the student; or (b) suspend the student from training, or extend the period of training of the student, for such period as it may deem fit; or (c) debar the student from training

20F.

Hearing of case by the High Court.- On receipt of a reference under section 20D, the High Court shall fix a date for the hearing of the reference and cause notice of the date so fixed to be given to the member of the Institute and the Council, and shall, after affording such member and the Council, either personally or through counsel or a member of the Institute, an opportunity of being heard, make any of the following orders, namely:(a) direct that the proceedings be filed, or dismiss the complaint, as the case may be; (b) reprimand such member; (c) remove him from membership of the Institute either permanently or for such period as it may deem fit; or (d) refer the case to the Council for further inquiry and report

20G.

Effect of inquiry.- For the purposes of this Chapter, "member of the Institute" includes a person who was a member of the Institute on the date of the alleged misconduct but has ceased to be a member of the Institute at the time of inquiry for any reason.

____________________________________________________________ 102. Return of certificates in the event of suspension or exclusion.- In the event of the suspension or exclusion of a member, every certificate of membership, fellowship or practice then held by him shall be deemed to be cancelled from the date on which and during the period for which the name of its holder is removed from the register and shall be delivered up by the member to the Secretary, in the case of suspension to be retained during the period of suspension, or in the case of exclusion, be cancelled.

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20H.

Council and Investigation Committee to have powers of Civil Court. The council and the Investigation Committee shall, for the purpose of an inquiry under this Chapter, be deemed to be a civil court and shall have the same powers as are vested in a civil court under the Code of Civil Procedure, 1908 (Act V of 1908), in respect of the following mattes, namely: (a) summoning and enforcing the attendance of any person and examining him on oath; (b) the discovery and production of any document; and (c) receiving evidence on affidavits.

20I.

Publication of findings and decisions.- Where a member of the Institute or a student is found guilty, the Council shall cause the findings and decisions given against such member or student, as the case may be, to be published in the official Gazette and in such journal or journals as the Council may deem fit: Provided that, where the Council deems necessary, it may omit the name of such member or student from publication.

20J.

Return of certificate.- (1) Where the name of a member of the Institute is removed from the Register, whether for a specified period or permanently, every certificate of membership or practice held by such member shall be deemed to be cancelled from the date of the order removing his name from the Register and shall stand so cancelled for the said period or, as the case may be, permanently.

(2) The certificate referred to in sub-section (I) shall be returned by the member of the Institute to the Secretary of the Council who shall, in the case of a member whose name is removed from the Register for a specified period, return the certificate to the member on the expiration of the said period. ______________________________________________________________ 103. Restoration to membership.- (1) The Council may on an application received in this behalf from a person whose name has been permanently or temporarily removed from the Register under section 19 restore his name if he is otherwise eligible to such membership:

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20K.

Appeal and revision.- (1) Any member of the Institute aggrieved by an order of the council imposing on him any of the penalties referred to in section 20D may, within sixty days of the date of communication of such order to him, prefer an appeal to the High Court. (2) The High Court may, on its own motion or on an application made to it, call for the record of any case in which the Council has made an order under section 20D and may(a) confirm, modify or set aside the order; (b) impose any penalty or set 'aside, reduce, confirm or enhance the penalty imposed by the order; (c) remit the case to the Council for such further inquiry as the High Court may consider proper in the circumstances of the case; or (d) pass such other order as it may deem fit: Provided that no order of the Council shall be modified or set aside unless the Council has been given an opportunity of being heard and no order imposing or enhancing a penalty shall be passed unless the person concerned has also been given an opportunity of being heard.

________________________________________________________ Provided he shall have paid before such restoration (the admission fee and) the annual fee or fees for the year during which his name is resorted, and, if his name has been removed under clauses (b) and (c) of section 19. all arrears on account of annual membership fee subject to a maximum of five years annual membership fee according to the scale applicable to him.

(2) The restoration of a name to the membership shall be notified in the Gazette of Pakistan and in such journals as the Council think desirable and shall also be communicated in writing to the person concerned. 104. Professional and other misconduct defined.- For the purpose of the Ordinance and these bye-laws, the expression "Professional and other misconduct" shall be deemed to include any act or omission specified in [Schedules "C" and "D"] but nothing in this section shall be construed to limit or abridge in any way the power conferred or duty imposed on the Council or the Investigation Committee under these bye-laws to inquire into the conduct of any member or articled or audit clerk under any other circumstances.

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CHAPTER VI PENALTIES 21.

Penalty for falsely claiming to be a member, etc.- Any person who(i) not being a member of the Institute(a) represents that he is a member of the Institute; or (b) uses the designation Chartered Accountant; *[................................... ]or (ii) being a member of the Institute, but not having a certificate of practice, represents that he is in practice or practices as a chartered accountant, shall be punishable on first conviction with fine which may extend to one thousand rupees, and on any subsequent conviction with imprisonment which may extend to six months or with fine which may extend to five thousand rupees, or with both.

22.

Penalty for using name of the Council, awarding degree of chartered accountancy, etc.- (1) No person shall(h) use a name or a common seal which is identical with the name or the common seal of the Institute or so nearly resembles it as to deceive or as is likely to deceive the public; (ii) award any degree, diploma or certificate or bestow any designation which indicates or purports to indicate the possession or attainment of any qualification or competence possessed by a person by virtue of his being a member of the Institute; or (iii) seek to regulate in any manner whatsoever the profession of chartered accountants. (2) Any person contravening the provisions of sub-section (1) shall, without prejudice to any other proceedings which may be taken against him, be punishable with fine which may extend on first conviction to one thousand rupees, and on any subsequent conviction with imprisonment which may extend to six months, or with fine which may extend to five thousand rupees, or with both.

______________________________________________________________ *Deleted the words ‘unless he is a member of any other Institute of Chartered Accountants’ by section 18 of the Chartered Accountants {Amendment} Ordinance, 1983.

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23.

Companies not to engage in accountancy.- (1) No company, limiting the liability of its members, whether incorporated in Pakistan or elsewhere shall practice as chartered accountants: *Provided that the members of the Institute shall be permitted to form into a limited company solely for practicing as ‘Management Consultants’. (2) If any company contravenes the provisions of sub-section( 1) then, without prejudice to any other proceedings which may be taken against the company, every director, manager, secretary and any other officer thereof, who is knowingly a party to such contravention, shall be punishable with fine which may extend on first conviction to one thousand rupees and on any subsequent conviction to five thousand rupees.

24.

Unqualified persons not to sign documents.- (1) No person other than a member of the Institute shall sign any document on behalf of a chartered accountant in practice or a firm of such chartered accountants in his or its professional capacity. (2) Any person contravening the provisions of sub-section (1) shall, without prejudice to any other proceedings which may be taken against him, be punishable with fine which may extend on first conviction to one thousand rupees, and on any subsequent conviction with imprisonment which may extend to six moths, or with fine which may extend to five thousand rupees, or with both.

25.

Sanction to prosecute.- No person shall be prosecuted under this Ordinance except on a complaint made by or under the order of the Council or of the Federal Government.

___________________________________________________________________ * Added by Section 19 of the Chartered Accountants (Amendment) of Ordinance, 1983. 22

CHAPTER VII MISCELLANEOUS 26.

Maintenance of branch offices.- ( 1 ) where a chartered accountant in practice or a firm of such chartered accountants has more than one office [*] each one of such offices shall be in the separate charge of a member of the Institute **[who ordinarily resides in the area served by such office;] Provided that the Council may in suitable cases exempt any chartered accountant in practice or a firm of such chartered accountants from the operation of this sub-section. (2) Every chartered accountant in practice or a firm of such chartered accountants maintaining more than one office shall send to the Council a list of offices and the persons in charge thereof and shall keep the Council informed of any change in relation thereto.

27.

Power to make bye-laws.- (1) The Council may, by notification in the official Gazette, make bye-laws for the purpose of carrying out the object of this Ordinance, and a copy of such bye-laws shall be sent to each member of the Institute. (2) In particular, and without prejudice to the generality of the foregoing power, such bye-laws may provide for all or any of the following matters:(a) the standard and conduct of examinations under this Ordinance; (b) the qualifications for the entry of the name of any person in the Register; (c) the conditions under which any examination or training may be treated as equivalent to the examination and training prescribed for the membership of the Institute; (d) the conditions under which any foreign qualifications may be recognized;

*Omitted the words ‘in Pakistan’ by sub-section (i) (a) of Section 20 of the Chartered Accountants (Amendment) Ordinance, 1983. ** Added by clause (I) (b) of Section 20 of the Chartered Accountants (Amendment) Ordinance, 1983. 23

(e) the manner in which and the conditions subject to which applications for entry in the Register may be made; (f) the fees payable for membership of the Institute and the annual fees payable by associates and fellows of the Institute in respect of their certificates; (g) the manner in which elections to the Council at the Regional Committees may be held; (h) the particulars to be entered in the Register; (i) the functions of Regional Committees; *(j) the training of the students and suspension of the training of student, for misconduct or for any other cause; (k) the regulation and maintenance of the status and standard of professional qualifications of members of the Institute; **(kk) the issue of directives to the members of the Institute on professional matter;] (l) carrying out of research in accountancy; (m) the maintenance of a library and publication of books and periodicals on accountancy; (n) the management of the property of the Council and the maintenance and audit of its accounts; (o) the summoning and holding of meetings of the Council, the times and places of such meetings, the conduct of business thereat and the number of members necessary to form a quorum; ________________________________________________________________ Substituted clause (i) of sub-section 2 of Section 27 reproduced below by sub-section (2) (a) of section 21 of the Chartered Accountants (Amendment) Ordinance, 1983. i) training of articled and audit clerks, the fixation of limits within which premier may be charged from articled clerks and the cancellation of articles and termination of audit service for misconduct or for any other sufficient cause. ** Added by sub-section (2) (b) of Section 21 of the Chartered Accountants (Amendment) Ordinance, 1983.

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(p) the powers, duties and functions of the President and the VicePresident or Vice-Presidents of the Council; (q) the functions of the Standing and other Committees and the conditions subject to which such functions shall be discharged; (r) the terms of office, and the powers, duties and functions of the Secretary and other officers and servants of the Council; (s) the rules of professional and other misconduct, and the exercises of disciplinary powers, and (t) any other matter which is required to be or may be prescribed under this Ordinance. (3) All bye-laws made by the Council under this Ordinance shall be subject to the condition of previous publication and to the approval of the Federal Government. (4) Notwithstanding anything contained in sub-section (1) and (2), the Federal Government may frame the first bye-laws for the purposes mentioned in this section and such bye-laws shall be deemed to have been made by the Council, and shall remain in force from the date of the coming into force of this Ordinance until they are amended, altered or revoked by the Council. 28.

Powers of Federal Government to direct bye-laws to be made or to make or amend bye-laws.- (1) Where the Federal Government considers it expedient so to do, it may, by order in writing, direct the Council to make any bye-law or to amend or revoke any bye-law already made within such period as it may specify in this behalf. (2) If the Council fails or neglects to comply with such order within the specified period, the Federal Government may make or amend, with or without modifications, or revoke, any bye-laws, directed to be made, amended or revoked by that order.

29.

References to registered accountants, etc., to be construed as references to chartered accountants.- Any reference to a chartered Accountants or a registered accountant or a certified or qualified auditor in any other law or in any document whatsoever shall be construed as a reference to a chartered accountant in practice within the meaning of this Ordinance.

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30.

Amendment of section 144 of the Companies Act, 1913 (VII) of 1913).- In section 144 of the Companies Act, 1913 (VII of 1913) for sub-section (1), (2), (2A) and (2B), the following sub-section shall be substituted, namely"(l) No person shall be appointed as an auditor of any company other than a private company not being the subsidiary company of a public company, unless he is a chartered accountant within the meaning of the Chartered Accountants Ordinance, 1961; Provided that a firm whereof all the partners practicing in Pakistan are chartered accountants may be appointed by its firm name to be auditors of a company and may act in its firm name".

31.

Savings.- Notwithstanding the amendment of section 144 of the Companies Act, 1913 (VII of (19 13), made by the preceding section, the Auditors Certificates Rules, 1950, shall, so far as applicable, continue in force as it they are bye-laws made under this Ordinance.

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*SCHEDULE 1 (SEE SECTION 20A) PART I Professional misconduct in relation to chartered accountants in practice A Chartered Accountant in practice shall be deemed to be guilty of professional misconduct, if he(1)

allows any person to practice in his name as a chartered accountant, unless such person is also a chartered accountant in practice and is in partnership with, or employed by, him;

(2)

pays or allows or agrees to pay or allow, directly or indirectly, any share, commission or brokerage in the fees or profits of his professional business to any person other than a member of the Institute or a partner or a retired partner or the legal representative of a deceased partner. Explanation:- In this clause, "partner" includes a person residing outside Pakistan with whom a chartered accountant in practice has entered into partnership which is not in contravention of clause (4) of this part;

____________________________________________________________ _ *Schedules inserted by Section 22 of the Chartered Accountants {Amendment) Ordinance, 1983. Note:- Above Schedules substitute Schedule C and Schedule D, reproduced below, of the Chartered Accountants Bye Laws, 1961 (Replaced):SCHEDULE ‘C’ A member of the Institute shall be guilty of professional and other misconduct if he:(1) places his professional service at the disposal of or enters into partnership with an unqualified person or persons in a position to obtain business of the nature in which chartered accountants engage by means which are not open to a member of the Institute: Provided that this paragraph shall not be construed as prohibiting a member from practicing in a country outside Pakistan in association with a person who is entitled under the law in force in that country to perform functions similar to those a member of the Institute is entitled to perform in Pakistan.

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(3)

accepts or agrees to accept any part of the profits of the professional work of a lawyer, auctioneer, broker, or other agent who is not a member of the institute.

(4)

Places his professional service at the disposal of, or enters into partnership with, an unqualified person in a position to obtain business of the nature in which chartered accountants engage by means which are not open to a member of the Institute:

__________________________________________________________________ (2) allows any person to practice in his name as a chartered accountants unless such person is also a chartered accountant and is in partnership with or employed by him;

(3) pays or allows or agree to pay or allow directly or indirectly any share, commission, or brokerage in the fees or profits of his professional business to any person other than a member of the Institute or partner or retired partner or the legal representative or widow of a deceased partner; (4) accepts or agrees to accept any part of the profits of the professional work of a lawyer, income-tax practitioner, auctioneer, broker or other agent or any other person other than a member of the Institute; (5) accepts a position as auditor previously held by some other member without first communicating with him in writing; (6) accepts an appointment without first ascertaining from the company that the requirements of section 144 (6) of the Companies Act, 1913 (VII of 1913}, or if the company is registered in an acceded State, the requirements of any analogous provision of laws in force in that State, have been duly complied with; (7) accepts a position as auditor previously held by some other member in such conditions as to constitute-under-cutting; (8) publishes or sanctions the publication of expressions of thanks or appreciation by clients or promotes in any way laudatory notices with regard to professional matters; (9) solicits clients or professional work either directly or indirectly by circular, advertisement, personal communication or interview or by any other means practicing of the nature of advertisement; (10) advertises his professional attainments or services or uses any designation or expressions other than chartered accountant on professional documents, visiting cards, letter heads or sign boards unless it be a degree of a University established by law in Pakistan or recognized by the Federal Government or a title indicating membership of the Institute of Chartered or may be recognized by the Council;

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Provided that this paragraph shall not be construed as prohibiting a member from practicing in a country outside Pakistan in association with a person who is entitled under the laws in force in that country to perform functions similar to those a member of the. Institute is entitled to perform in Pakistan: (5)

Solicits clients for professional work either directly or indirectly by circular, advertisement, personal communication or interview or by any other means;

(6)

Advertises his professional attainments or services, or uses any designation or expression other than chartered accountant on professional documents. Visiting cards, letter head or sign boards, unless it be a degree of a University established by law in Pakistan or recognized by the Federal Government or the Council;

(7)

Accepts a position as auditor previously held by another member of the Institute without first communicating with him in writing;

(8)

accepts an appointments as auditor of a company without first ascertaining from it whether the requirements of sub-section (6) of section 144 of the Companies Act, 1913 (VII of 1913), in respect of such appointment have been duly complied with;

___________________________________________________________________ (11) allows his name to be inserted in any directory, either in the main section or an classified list, whether printed or not; so as to appear in leaded type or in any manner, which could be regarded as of an advertising character; (12) certifies any accounts, exhibits, statements, schedules or other forms of accountancy work which have not been verified entirety under the personal supervision of himself, a member of his staff, another member of the Institute or his partner; Provided that the above will not apply in cases of accounts of foreign branches or subsidiaries of his clients which have been duly certified by a public accountant; (13) gives estimates of future profits for publication in a prospectus or otherwise, or certifies for publication statements of average profits over a period of two or more years without at the same time stating the profits of losses for each year separately; (14)

charges or offers to charges, accepts or offers to accept in respect of any professional employment, fees which are based on a percentage of profits or which are contingent upon the findings or results of such employment; [except in cases which are permitted under any regulations of Government or requirements of law]:

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(9)

charges or offers to charge, accepts or offers to accept in respect of any professional employment fees which are based on a percentage of profits or which are contingent upon the findings or results of such employment except in cases which are permitted under any law for the time being in force or by an order of the Government;

(10)

Engages in any business or occupation other than the profession of chartered accountants unless permitted by the Council so to engage; Provided that nothing contained herein shall disentitle a chartered accountant from being a director of a company unless he or any of his partners is interested in such company as an auditor;

(11)

accepts a position as auditor previously held by some other chartered accountant in such conditions as to constitute undercutting;

(12)

allows a person not being a member of the Institute or a member not being his partner to sign on his behalf or on behalf of his firm; any balance sheet, profit and loss account, report or financial statement; or

(13)

gives estimates of future profits for publication in a prospectus or otherwise or certifies for publication the statements of average profits over a period of two years or more without, at the same time, stating the profits or losses for each year separately.

(15)

[being chartered accountant in practice engages] in any business or occupation other than the profession of chartered accountants unless permitted by the Council so to engage; Provided that nothing contained herein shall disentitle a chartered accountant from being a director of a company unless he or any of his partners is interested in such company as an auditor;

(16)

allows a person not being a member of the Institute or a member not being his partner to sign on his behalf or on behalf of his firm, any report or financial statement or any other document required by his client;

(17)

discloses information acquired in the course of his professional engagement to any person other than his client, without the consent of his client or otherwise than as required by any law for the time being in force;

(18)

expresses his opinion on financial statements of any business or any enterprise in which he his firm or a partner in his firm has a substantial interest, unless he discloses the interest also in his report;

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(19)

fails to disclose a material fact known to him which is not disclosed in a financial statement, but disclosure of which is necessary to make the financial statement not misleading;

(20) fails to report a material mis-statement known to him to appear in a financial statement with which he is concerned in a professional capacity;

(21)

is grossly negligent in the conduct of his professional duties;

(22)

fails to obtain sufficient information to warrant the expression of an opinion or his qualifications are sufficiently material to negate the expression of opinion;

(23)

fails to keep moneys of his client in a separate banking account or to use such money for purposes for which they are intended;

(24)

has been guilty of any act or default discreditable to a chartered accountant or a member of the Institute;

(25)

(i) contravenes any of the provisions of the Ordinance or the bye-laws made from time to time; (ii) is guilty of such other act or omission as may be specified by the Council in this behalf, by notification in the Gazette of Pakistan;

(26)

not being a fellow styles himself as a fellow;

(27) does not supply the information called for or does not comply with the requirements asked for, by the Council or any of its Committees.

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Schedule I - Contd. Part 2 Professional misconduct in relation to members engaged in management consultancy A member of Institute engaged in management consultancy shall be deemed to be guilty of professional misconduct, if he(1)

advertises or solicits for work or issues any circular, calendar or publicity material;

(2)

issues brochures, except to existing clients or in response to an unsolicited request;

(3)

uses designatory letters indicating qualifications of the directors and members of the company on letter head, notepapers, or professional cards excepts as provided in clause (6) of Part 1 of this Schedule;

(4)

refers to associate firms of Chartered Accountants on his letter head or professional cards or announcements;

(5)

adopts a name or associates himself as a partner or director of a firm or a company whose name is indicative of its activities; ______________________________________________________________________ REGULATIONS:

SCHEDULE 'D'

(a) members in practice:

subject to the prior consent of the Council, a member in practice may act as a proprietor, partner or director of a management consultancy firm or an unlimited company.

(b) members not in practice;

A member not in practice may act as a director or an employee of a management consultancy firm or an unlimited Company.

CODE OF ETHICS: A member engaged in management consultancy:1.

shall not advertise or solicit for work or issue any circular, calendar or publicity material;

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(6)

uses the term chartered accountants for his management consultancy firm or company;

(7)

shares profits of remuneration in a manner contrary to clauses (2) and (3) of Part 1 of this Schedule, except when he associates with nonmembers as stated in clause (10) of this part;

(8)

or his partner in any firm accepts auditing, taxation, or other conventional accounting work from any client introduced to him for management consultancy services by the client's own professional accountant;

_________________________________________________________________ _ 4.

shall not refer to associated firms of management consultants on their letterheads or professional cards or announcements and vice-versa;

5.

shall not adopt a name or associate himself as a partner or director of a firm or a company whose name is indicative of its activities;

6.

shall not use the designation "CHARTERED ACCOUNTANT(S)" for his management consultancy firm or company;

7.

shall not share profits or remuneration in a manner contrary to paragraphs (3) and (4) of Schedule 'C' except when he associates with non-members as stated in regulation 13 of this Schedule;

8.

shall not accept, nor, shall a partner in any firm in which he is a partner accept, auditing taxation or other conventional accountancy work from any client introduced to him for management consultancy services by the client's own professional accountant;

9.

may write a personal letter to make a direct approach to another member of the profession in practice offering his firm's or company's services;

10. may only use the term 'MANAGEMENT CONSULTANT (S) 'where he is connected with an organization in the consulting field as proprietor, partner or director. This is intended to exclude such terms as "BUSINESS CONSULTANT" "ADVISORS TO MANAGEMENT" "INDUSTRIAL CONSULTANT", etc. 11. shall abide by the rules of professional conduct of the Institute and shall ensure that the firm or company with which he is associated either as proprietor, partner or director abide by those rules;

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(9)

uses the term "Management Consultant(S)" except in respect of a company engaged in management consultancy field;

(10)

associates with non-members for the rendering of various management services except as long as such non-member observes the bye-laws and code of professional ethics of the Institute;

(11)

does not communicate with the existing professional accountant or consultant, if a member of the Institute, informing him of the special work he has been asked to undertake in the event of an introduction for management consultancy work other than through the existing professional accountant; or

(12)

Under the guise or through the medium of a company or firm does anything which he is not allowed to do as an individual. _____________________________________________________________

12. shall be responsible from the standpoint of ethics for the conduct of the company and its director's and officers as if the company were a firm in which he is partner. Further an employee member shall be held responsible for any action of his employer which contravenes the rules of professional conduct of the Institute if he is a party thereto; 13. may associate with non-members for the rendering of various management services as long a such non-members observe the bye-laws and code of professional ethics of Institute; 14. shall communicate as a matter of professional courtesy with the existing professional accountant or consultant informing him of the special work he has been asked to undertake in the event of an introduction for management consultancy work other than through the existing professional account; 15. shall not do under the guise or through the medium of a company or firm any thing which he is not allowed to do as an individual. Merchandise accounting or computer services: In addition to the rules of ethics applicable to management consultancy work, the following rules shall apply to mechanized accounting or computer services: 1.

Such services shall not be advertised nor shall there be soliciting other than by direct communication with other members of the profession who are in practice.

2.

A member offering such services shall not accept auditing, taxation or other commercial accounting work from any client introduced to h im by the clients' own professional accountant for the provision of mechanized accounting or computer service.

3.

A member shall communicate as a matter of professional courtesy with the existing accountant notifying him of the special work he has been asked to undertake in the event of an introduction for mechanized accounting or computer services other than through the existing accounting.

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Schedule I - Contd. PART 3 Professional misconduct in relation to members of the Institute in service A member of the Institute (other than a member in practice) shall be deemed to be guilty of professional misconduct, if he, being an employee of any company, firm or person: (1)

pays or allows or agrees to pay directly or indirectly to any person any share in the emoluments of the employment undertaken by the member;

(2)

accepts or agrees to accept any part of fees, profits or gains from a lawyer, chartered accountant or broker engaged by such company, firm or person or agent or customer of such company, firm or person by way of commission or gratification; or

(3)

discloses confidential information acquired in the course of his employment except as and when required by law or except as permitted by the employer PART 4

Professional misconduct in relation to members of the Institute generally A member of the institute, whether in practice or not, shall be deemed to be guilty of professional misconduct, if he(1)

includes in any statement, return or form to be submitted to the Institute any particulars knowing them to be false;

(2)

not being a fellow styles himself as a fellow;

(3)

does not supply the information called for by the Institute or does not comply with the requirements asked to be complied with or does not comply with any of the directives issued or pronouncements made by the Council or any of its Standing Committees;

(4)

generally, willfully maligns the Institute, the Council or its Committee to lower their prestige, or to interfere with performance of their duties in relation to himself or others;

(5)

has been guilty of any act or default discreditable to a member of the Institute; or

(6)

contravenes any of the provisions of the Ordinance or the bye-laws made there under.

35

SCHEDULE II (SEE SECTION 20A AND 20D) Part 1 Professional misconduct in relation to chartered accountants in practice requiring action by a High Court A chartered Accountant in practice shall be deemed to be guilty of Professional misconduct, if he(1)

discloses information acquired in the course of his professional engagement to any person other than his client, without the consent of his client or otherwise than as required by any law for the time being in force;

(2)

certifies or submits in his name or in the name of his firm a report of an examination of financial statement unless the examination of such statements and the related records has been made by him or by a partner or an employee in his firm or by another chartered accountant in practice;

(3)

permits his name or the name of his firm to be used in connection with any estimates of earnings contingent upon future transactions in a manner which may lead to the belief that he vouches for the accuracy of the forecast;

(4)

expresses his opinion on financial statements of any business or any enterprise in which he, his firm or a partner in his firm has a substantial interest, unless he discloses his interest in his report;

(5)

fails to disclose a material fact known to him which is not disclosed in a financial statement, but disclosure of which is necessary to ensure that the financial statement is not misleading;

(6)

fails to report a material mis-statement known to him to appear in a financial statement with which he is concerned in a professional capacity;

(7)

is grossly negligent in the conduct of his professional duties;

(8)

fails to obtain sufficient information to warrant the expression of an opinion or his exceptions are sufficiently material to negate the expression of an opinion; or

(9)

fails to keep moneys of his client in a separate banking account or fails to use such moneys for purposes for which they are intended. 36

Schedule II - Contd. PART 2 Professional misconduct in relation to members engaged in management consultancy requiring action by a High Court A member engaged in management consultancy shall be deemed to be guilty of professional misconduct, if he(1)

discloses information acquired in the course of his professional engagements to any person other than his client, without the consent of his client or otherwise than as required by any law for the time being in force;

(2)

is grossly negligent in the conduct of his professional duties; or

(3)

fails to keep moneys of his client in a separate banking account or fails to use such moneys for purposes to which they are intended. SCHEDULE III (SEE SECTION 20A AND 20E) Professional misconduct in relation to the students of the Institute

A student of the Institute shall be deemed to be guilty of professional misconduct if he(1) (2) (3) (4) (5) (6) (7)

contravenes any of the provisions of the Ordinance or the bye-laws made there under; does not supply the information called for by the Institute; does not comply with any requirements which he is asked by the Institute to comply with; does not comply with any of the directives issued by the Council or any of its committees; discloses confidential information acquired in the course of his training except as and when required by law or except as permitted by his principal; includes in any statement or form to be submitted to the Institute, any particulars knowing them to be false; or has been guilty of any act or omission discreditable to a student of the Institute. 37

PART II

CHARTERED ACCOUNTANTS BYE-LAWS, 1983

AS AMENDED UP TO JULY 2008

CHARTERED ACCOUNTANTS BYE-LAWS, 1983 AS AMENDED UP TO JULY 2008

CONTENTS CHAPTER I PRELIMINARY Bye-Law 1. 2. 2A. 3. 4.

Page

Short title and commencement Definitions Members in Practice Forms Notice to members

39 39 41 41 42 CHAPTER II

MEMBERS OF THE INSTITUTE 5. 6. 7. 8. 9. 10.

Register Admission of members Particulars to be supplied by members Certificate of Practice Certificate of Admission and Practice Fees

42 42 42 43 43 43

CHAPTER III ELECTIONS TO THE COUNCIL 11. 12. 13. 14. 15. 16. 17. 18. 19. 20. 21. 22. 23. 24.

Date of election Members entitled to vote Qualifications of members to stand for election Numbers of members to be elected List of voters Nominations Fee for election Scrutiny of nominations Preparation of list of valid nominations Withdrawal of candidature Intimation of final list of nominations to voters Death or cessation of membership of a candidate Uncontested election, etc. Admissible number of votes to a voter

44 45 45 45 46 46 46 46 47 48 48 48 48 49

25. 26. 27. 28. 29. 30.

Mode of election Election stations Election officer Secret chamber Ballot paper Presence of the candidates and their authorized representatives at the election stations 31. Voting to be in person and not by proxy 32. Assistants to Election officer 33. Identification of voters 34. Record to be kept by the election officer 35. Manner of recording of votes after receipt of ballot paper 36. Procedure at the election station 37. Eligibility to vote by post 38. Election committee to send ballot papers by post 39. Ballot papers to be returned after recording votes thereon 40. Issue of undelivered and fresh ballot papers 41. Grounds for declaring ballot papers invalid 42. Appointment of time and place for the counting of votes 43. Presence of candidates at the time of counting of votes 44. Counting of votes 45. Notification of results 46. Election not to be invalid due to accidental omission etc. 47. Disciplinary action against a member in connection with conduct of election 47A. Presentation by each candidate 48. Election dispute

49 49 49 49 49 49 50 50 50 50 51 51 52 52 52 52 52 53 53 53 54 54 54 56 57

CHAPTER IV MEETINGS AND PROCEEDINGS OF THE COUNCIL 49. 50. 51. 52. 53. 54. 55. 56. 57. 58.

Meetings of the Council Notice of meeting Special meetings Presiding over meetings Quorum at meetings Adjournment of meeting Procedure for transaction of business Passing of resolution at meetings Records of minutes Absence of members of the Council from Pakistan

57 57 57 57 57 58 58 59 59 59

CHAPTER V MEETINGS AND PROCEEDINGS OF THE INSTITUTE 59. 60.

Annual meeting Special meetings

59 60

61. 62. 63. 64. 65. 66. 67. 68. 69. 70. 71.

Notice of meeting Notice of motion to be given Meetings to be presided by the President etc. Quorum at meetings Adjournment of meeting Voting at meetings and demand for poll Appointment of scrutineers Procedure when poll demanded Result of poll Demand for poll not to prevent other business Minutes of the meeting

60 60 60 61 61 61 61 61 62 62 62

CHAPTER VI STANDING AND OTHER COMMITTEES 72. 73. 74. 75. 76. 77. 78. 79. 80. 81. 82. 83. 84.

Committees of the Council Executive Committee Examination Committee Investigation Committee Chairman of the Standing Committees Term of office of members of the committees Meetings of the Committees Notice of meeting Quorum, etc., at meetings Procedure for transaction of business Casting vote Secretary of the Committees Minutes

63 63 64 65 66 66 66 66 67 67 67 67 67

CHAPTER VII REGIONAL COMMITTEES 85. 86. 87. 88. 89. 90. 91. 92. 93. 94. 95. 96.

Regional Committees Admission and removal from regional register Resignation from the regional committee and casual vacancies Date of election Election to the regional committees Duties and functions of regional committees Office bearers in the regional committee Finance and accounts Meetings of Regional Committees Meetings of the members of the regional constituency Duration of the Regional Committee Dissolution of a Regional Committee

68 68 68 69 69 69 71 71 72 72 72 72

CHAPTER VIII STUDENTS 97. 98. 99. 100. 101. 102. 103. 104. 105. 106. 107. 108.

Admission of students as trainees Probationary period Period of training and registration of training contract Provisions to be included in training contract Premium Criteria to train students Transfer and execution of fresh training contracts Maximum number of students to be trained by a member Permission to train additional students Students not to engage in other business Power to terminate the training of a student Registers to be maintained

73 74 74 74 74 74 75 76 77 77 78 78

CHAPTER IX TRAINING AND EXAMINATION 109. 110. 111. 112. 113. 114. 115. 116. 117. 118. 119.

Conditions to become a member of the Institute Study courses & materials Time and places of examinations Registration of examinees Subject and syllabus of the examinations Application for admission to an examination Admission fee for examinations Refund of examination fee Examination results Failure of candidates at examinations Examination certificates

79 80 80 80 80 81 81 81 81 82 82

ENTRANCE EXAMINATION 120. Admission to Pre-entry Proficiency or Aptitude test

82

FOUNDATION AND INTERMEDIATE EXAMINATIONS 121. Admission to Foundation Examinations 122. Admission to Intermediate Examinations 123. Exemption Policy FINAL OR PROFESSIONAL EXAMINATIONS

82 83 83

124. Admission to Final or Professional Examinations 125. Certificate of service and fitness

83 84

CHAPTER X MISCELLANEOUS 126. Finances 127. Audit of accounts of the Institute 128. Powers and duties of the President and Vice President or Vice Presidents 129. Powers and duties of the Secretary 129A. Power to issue directives 130. Indemnity 131. Constitution of students’ associations 132. Method of payment of fees 133. Publication of list of members 134. Custody and use of Common Seal 135. Other Functions of chartered accountants in practice 136. Location of the office of the Institute 137. Power to remove difficulties 138. Repeal of Chartered Accountants Bye-Laws, 1961.

Schedule A Forms

48 85 85 86 87 87 87 88 88 88 88 89 89 89

90-91

CHARTERED ACCOUNTANTS BYE-LAWS, 1983* S.R.O.51(KE)/83:

Karachi, the 1st November, 1983

In exercise of the powers conferred by sub-section (1) of section 27 of the Chartered Accountants Ordinance, 1961 (X of 1961), the Council of the Institute of Chartered Accountants of Pakistan, with the approval of the Federal Government makes the following bye-laws, the same having been previously published as required by subsection (3) of that section, namely:CHAPTER 1. – PRELIMINARY 1.

Short title and commencement.- (1) These bye-laws may be called the Chartered Accountants Bye-Laws, 1983.

(2)

They shall come into force at once.

2.

Definitions.- (1) In these bye-laws, unless there is anything repugnant in the subject or context:(a) certificate of practice means a certificate granted under these bye-laws, entitling the holder to practice as a chartered accountant or Management Consultant; (b) date of election means the date of polling or palings of an election (c) form means a form set out in the Schedule; (d) graduate means a graduate of a University constituted by law in Pakistan, or a graduate of any other University recognized by the Council; *(da) “member responsible for training” means the Principal and includes a member responsible for approved training under the Training Regulations designated as such by a training organization on whose behalf he will be signing a training contract with students; (e) Ordinance means the Chartered Accountants Ordinance, 1961 (X of 1961) (f) President means the President of the Institute;

*(g) “Principal” means a member entitled by the Institute to train students or a member designated as such in an approved training organization; _______________________________________________________________________ These bye-laws were published in part-II of the Gazette of Pakistan Extraordinary dated December 1, 1983.

**S.R.O. 12 (KE)/2006 dated 27.01.2006, Part-II, Extra-ordinary Gazette of Pakistan dated 04.02.2006 39

(h) Principal place of business means the place of business registered by a member of the Institute or, where more than one place of Business is registered, the place of business indicated by him as his principal place of business; (i) “registered address” means, in the case of a member in practice his principal place of business, and in the case of a member not in practice, the address last notified by him to institute as his address for communications; (j) “schedule” means the schedule annexed to these bye-laws; these bye-laws were published in part-II of the Gazette of Pakistan Extra-ordinary dated December 1, 1983. (k) “seal” means the seal of the Institute; (l) “Secretary” means the Secretary of the Institute and includes a Deputy Secretary or an Assistant Secretary of the Institute, or any person acting as Secretary under direction of the Council; (m) “section” means a section of the Ordinance; *(n) deleted (o) “training” means training under training contract with a member of the Institute entitled to train students under the Ordinance and these bye-laws: *(oa) “training organization” means a firm of chartered accountants including a member in practice or an undertaking approved as determined by the Council to provide suitable environment to students for gaining competence based practical experience prior to admission to membership of the Institute; *(ob) “training regulations and guidelines” means training regulations and guidelines as approved by the Council; (p) “Tribunal” means the Tribunal appointed under section 10 of the Ordinance; and (q) “Vice President” means the Vice-President of the Institute. (2)

Any reference in these bye-laws to members, associates, or fellows shall, unless the contrary intention appears, be construed as a reference to members associates and fellows respectively of the Institute. _______________________________________________________________________ *S.R.O. 12(KE)/2006 dated 27.01.2006, Part-II, Extra-ordinary Gazette of Pakistan dated 04.02.2006.

(n)

“student” means a person who is or has been a trainee under training contract with a principal, and has not successfully completed the examinations of the Institute, or who has been admitted to the Basic Accountancy Course. 40

*2A.

Member in practice.- (1) A member shall be deemed “to be in practice” when individually or in partnership with chartered accountants in practice, he in consideration received or to be received,(i)

engages himself in the practice of accountancy; or

(ii)

offers to perform or performs services involving the auditing or verification of financial transactions, books, accounts, or records or the preparation, verification or certification of financial accounting and related statements or holds himself out to the public as an accountant; or

(iii)

renders professional services or assistance in or about matters of principle or detail relating to accounting procedure or the recording, presentation or certification of financial facts or data; or

(iv)

renders services in the field of management consultancy; or

(v)

renders such services as, in the opinion of the Council, are or may be rendered by a chartered accountant in practice and the expression “to be in practice” with its grammatical variations and cognate expressions shall be construed accordingly; or

(vi)

an associate or a fellow of the Institute who is a salaried employee of a chartered accountant in practice or a firm or a training organization of such chartered accountants shall, notwithstanding such employment, be deemed to be in practice for the limited purpose of training of students.

(2)

A member shall be entitled to practice as a chartered accountant or a management consultant on being granted a certificate of practice provided that for granting certificate of practice the Council may impose such conditions as it may deem fit.

(3)

Every such member in practice shall pay an annual fee for his certificate in such manner and in such amount as may be approved by the Council from time to time;

3.

Forms.- The forms set out in the Schedules shall be used in matters which they purport to relate and all notes and directions contained in the forms shall be observed accordingly. ______________________________________________________ *S.R.O. 12(KE)/2006 dated 27.01.2006, Part-II, Extra-ordinary Gazette of Pakistan dated 04.02.2006.

41

4.

Notice to members.- (1) All notices required by the Ordinance and these byelaws to be given or sent to members shall be sent under certificate of posting or by messenger to the registered address of each member and for proving that such notice has been given or sent it shall be sufficient to prove that notice was properly addressed and posted or delivered. (2)

The non-receipt of any such notice shall not invalidate any such notice meeting, resolution, proceeding or action in any meeting. CHAPTER II – MEMBERS OF THE INSTITUTE

5.

Register.- The register of members shall be maintained in Forms I and II specified in Schedule ‘A’.

6.

Admission of members.- (1) Every applicant for admission as an associate or a fellow shall satisfy the Council of his having fulfilled the conditions specified in the Ordinance and these bye-laws in such manner as the Council may require and shall produce for being enrolled as an associate or a fellow such documentary evidence about his eligibility for admission and removal of disqualification, if any, as the Council may deem necessary and the Council, on being so satisfied, shall admit him on payment of the fees prescribed in these bye-laws. (2)

7.

Every person before becoming a member shall undertake to be bound by the Ordinance, these bye-laws and the pronouncements issued by the Council from time to time.

Particulars to be supplied by members.- Every member shall inform the Secretary of any change in his registered address, or place or places of business or employment and shall also supply the Council with any other information relating to his practice or employment which the Council may reasonably require for carrying out the provisions of the Ordinance or these bye-laws.

42

8.

Certificate of practice.- (1) A member may apply to the Council for *a certificate to practice entitling him to practice as a chartered accountant or management consultant and the Council shall grant to him such a certificate on his establishing to its satisfaction in such manner as it may require that **he has complied with the requirements as stipulated in bye law 109 and any other directive of the Council and that he will be in practice as a chartered accountant or management consultant as his main occupation. (2)

The certificate shall be issued in the form prescribed by the Council and shall be valid until the thirtieth day of June next following.

(3)

The validity of the certificate shall, on payment of the annual fees, *and on fulfillment of the directives of the Council be extended from time to time by a renewal certificate to be issued by the Secretary in the form prescribed by the Council.

(4)

A member in practice, on ceasing to be in practice, shall(i) inform the Council immediately of the fact of his having done so, but in any case not later than one month from the date he ceases to practice; and (ii) return the certificate of practice to the Secretary.

9.

Certificate of admission and practice.- Upon a person being admitted as an associate or a fellow and being permitted to practice, he shall in each event be entitled to a certificate to that effect under seal.

10.

** Fees.- (1) Every member shall pay to the Institute such fee, as applicable to him, within such time and in such manner, as prescribed by the Council from time to time.

______________________________________________________ * SRO 84 (KE)/94 dated 21.2.1994. ** SRO 2 (KE)/99 dated 10-2-1999. *** SRO 5 (KE)/97 dated 12.10.96 published on 20.2.97. ****SRO 23 (KE)/95 dated 19.1995 published on 28.1.95

43

Provided that(i)

(ii)

half the amount of annual membership fee only shall be payable by a person admitted on or after the first January and before the first July in any year; an associate, on being admitted as a fellow during a year, shall pay for that year any additional fee necessary to increase his fees to the amount then applicable to him; except that where the said change takes place after the last day of December, one-half only of the said additional amount shall be payable.

(iii)

a member attaining the age of 60 years and not holding a certificate of practice and also holding no office of profit shall pay *one hundred and twenty rupees only as annual fee *or one-time fee of three thousand rupees as a lifetime membership fee. No admission fee shall be charged from such Associate member on being enrolled as a Fellow if he is otherwise eligible to be enrolled as such.

(2)

All annual fees shall be payable by the first day of July each year. CHAPTER III – ELECTION TO THE COUNCIL

11.

Date of election.- (1) The Council shall decide and notify to the members the date of election at least four months before such date. (2)

The President shall, within a fortnight of the date of notification of the date of election by the Council, appoint three members who are not members of the Council to act as Election Committee.

(3)

The Election Committee, not later than thirty days from the date of notification of the date of election may, by notification, call upon the members to elect members of the Council and shall specify therein:(i)

a day, at least twenty days after the issue of the notification, on or before which nomination of candidates is to be made;

(ii)

a day, at least one day after the nomination day, for the scrutiny of nomination papers.

(iii) A day, at least ten days after the nomination day, on or before which candidature may be withdrawn; ______________________________________________________________________ * SRO.54(KE)/2008 dated 05.06.2008, Part-II of Extraordinary Gazette of Pakistan dated 21.07. 2008.

44

(4)

12.

(iv)

A day, at least forty-five days after the date of the withdrawal of the candidature, on or before which ballot papers by post should reach the Election Committee under bye-law 39;

(v)

A day for counting of votes; and

(vi)

A day for the declaration of results.

In the notification issued under clause (3), the Election committee shall also specify the number of members to be elected to the Council from each zone of the regional constituency.

Members entitled to vote.- Subject to the provisions of these bye-laws, a member whose name is borne on the Register on the date immediately preceding four months from the date of election shall be entitled to vote in the election from the respective zone of the regional constituency within whose territorial jurisdiction his address falls on the said date: Provided that his name has not been removed from the Register after publication of the list of voters.

13.

Qualifications of members to stand for election.- Subject to the provisions of these bye-laws, a member of at least five years continuous standing with the Institute on the date of election, shall be eligible to stand for election to the Council from the respective zone of the regional constituency in which his name is included.

14.

Number of members to be elected.- The number of members to be elected to the Council from each zone of the two regional constituencies shall be as under:(a)

SOUTHERN REGION:

(i)

Zone A: Comprising the province of Sindh

(ii) Zone B: Comprising the province of Baluchistan TOTAL

*8

1 ______ *9 ______

________________________________________________________________________________________ *S.R.O.10(KE)/2009 dated 23.02.2009, published in the Part II of Extraordinary Gazette of Pakistan dated 24.02.2009

45

(b) NORTHERN REGION: (i) Zone A: Comprising the province of the Punjab including Federal Capital of Islamabad

*5

(ii) Zone B: Comprising the North-West Frontier Province, Tribal Areas and Azad Kashmir 1 ______ TOTAL *6 ______ 15.

List of voters.- At least three months before the date of election, the Election Committee shall notify to the members of each zone of a regional constituency a list of members eligible to vote in that zone, with their addresses, and the manner in which the voters in any particular place shall exercise their right of vote. Explanation:- Subject to the provisions of these bye-laws, the address of a member published in the list of voters shall be final for determining the manner in which he shall be entitled to cast his vote or the zone of the constituency to which he shall belong for the purpose of casting his vote.

16.

Nominations.- The nomination of a candidate shall be in the appropriate form duly signed by the candidate and by the proposer and the seconder both of whom shall be persons entitled to vote in the election of the zone of the regional constituency to which the candidate belongs and shall be forwarded by registered A.D. or hand delivery to the Election Committee so as to reach it not later than 4.00 p.m. on the nomination date.

17.

Fee for election.- (1) A candidate for election shall pay, irrespective of the number of nominations, in all a fee of two hundred rupees by a demand draft payable to the Institute. (2)

18.

A candidate whose nomination is held to be invalid shall be entitled, on an application made by him in this behalf to the refund in full of the fee.

Scrutiny of nominations.- (1) The Election Committee shall scrutinize the nomination papers of all the candidates and shall endorse on each nomination paper its decision whether it accepts or reject the nomination. (2)

The Election Committee shall record in brief the reasons for rejecting a nomination.

________________________________________________________________________________________ *S.R.O.10(KE)/2009 dated 23.02.2009, published in the Part II of Extraordinary Gazette of Pakistan dated 24.02.2009

46

(3)

The Election Committee shall reject a nomination if it is satisfied that(i)

the candidate was ineligible to stand for election: or

(ii)

the proposer or the seconder was not qualified to subscribe to the nomination paper; or

(iii) the signature of the candidate or the proposer or the seconder was not genuine; or (iv)

there has been a failure to comply with the provisions of bye-laws 16 or 17.

Provided that:-

19.

(i)

the Election Committee shall not reject a nomination paper on the ground of a technical defect which is not of a substantial character; and

(ii)

the rejection of a nomination paper by reason of any irregularity in respect of that nomination paper shall not invalidate the nomination of a candidate by any other valid nomination paper.

(4)

If a proposer or a seconder incurs any disability by reason of the operation of the provisions of the Ordinance or these bye-laws subsequent to the date of signing the nomination, it shall not invalidate the nomination paper.

(5)

In case where a nomination paper or more than one nomination papers were filed and one or more of each nomination papers of a candidate has or have been rejected, the Election Committee shall give notice of its decision together with a brief statement of its reasons therefore to the candidate concerned by registered post.

Preparation of list of valid nominations.- (1) The Election Committee shall, after the scrutiny of nomination papers, prepare a list of validly nominated candidates for each zone of the constituency and cause a copy of the list to be sent by registered post to each candidate from the zone within ten days of the nomination date. (2)

The list shall contain full names in alphabetical order and the addresses of validly nominated candidates for each zone of the constituency. 47

20.

Withdrawal of candidature.- (1) Any validly nominated candidate may withdraw his candidature by notice in writing subscribed by him and delivered to the Election Committee before 4.00 p.m. of the withdrawal date. (2)

The withdrawal of candidature shall be intimated by the Election Committee to the other candidates standing for election from the same zone of the constituency.

(3)

A candidate who has withdrawn his candidature in accordance with clause (1) shall be entitled to the refund in full of the fee paid by him under bye-law 17.

21.

Intimation of final list of nominations to voters.- The Election Committee shall omit from the list of validly nominated candidates the name of candidates who have withdrawn their candidature and send the final list of such candidates, hereinafter referred to contesting candidates, to all the candidates and voters of the respective zones by registered post at least one month before the date of election.

22.

Death or cessation of membership of a candidate.- (1) If a validly nominated candidate who has not withdrawn his candidature dies or otherwise ceases to be a member before the date of election, the election in that zone of the constituency shall be conducted among the remaining candidates. (2)

23.

The votes cast in favour of any such candidate shall be ignored for counting purposes.

Uncontested election, etc.- (1) Where after at the scrutiny under bye-law 18, or after the withdrawal under by-law 20, the number of validly nominated candidates from any zone of the constituency remains equal or less than the number of members to be elected from that zone of the constituency or where the number of candidates from any zone of the constituency, becomes equal to or less than the number of members to be elected from that zone of the constituency, by reason of death or cessation of membership of one or more candidates before the date of election, such candidates shall be deemed to have been elected and the Election Committee shall declare such candidates to be elected from that zone. (2)

Where the number of such candidates from a zone of the constituency is less than the number of members to be elected from that zone of the constituency, the members declared elected from that zone of the constituency shall nominate members of the Council from that zone of the constituency for the remaining seat or seats. 48

24.

Admissible number of votes to a voter.- A voter shall have as many numbers of votes as the number of seats reserved for the zone of the constituency in which the voter resides.

25.

Mode of election.- The election shall be by poll and a voter shall cast his vote in person at an election station set up for the purpose except where he is allowed to cast his vote by post.

26.

Election stations.- The Election Committee shall set up such number of election stations at such places as it may deem necessary: Provided that no election station shall be set up in any town or city having less than ten voters, according to their addresses as given in the list of members eligible to vote.

27.

Election Officer.- (1) The Election Committee shall appoint an Election Officer for each election station and may also appoint such other person as it may deem necessary to assist the Election Officer. (2)

The Election officer shall, in addition to performing the duties imposed upon him by these bye-laws, be in general charge of all arrangements at the election station and may issue order as to the manner in which persons shall be admitted to the election station and generally for the preservation of peace and order at or in the vicinity of the election station.

28.

Secret chamber.- There shall be a secret chamber or chambers at each election station for casting votes by voters.

29.

Ballot paper.- The ballot paper shall contain a list of the candidates validly nominated for a zone of the constituency and shall bear the seal of the Election Committee.

30.

Presence of the Candidates and their authorized representatives at the election stations.- (1) A contesting candidate shall be entitled to be present at the election station or stations in the respective zone. 49

(2)

A contesting candidate may, before the commencement of the poll, appoint for each polling booth at an election station two polling agents, who shall be members of the Institute but only one of them shall be entitled to be present at a time on his behalf at that particular polling booth.

(3)

No appointment of a polling agent shall be valid unless the candidate has issued a letter of authority to such polling agent and that letter shall contain the full name, membership number, address of the polling agent and the name of the polling booth of an election station at which he is authorized to be present.

31.

Voting to be in person and not by proxy.- Voting shall be by ballot and voter desiring to record his vote shall do so in person and not by proxy.

32.

Assistants to Election Officer.- The Election officer may appoint such person as he thinks fit to assist him in carrying out his duties under these bye-laws.

33.

Identification of voters.- (1) Every person claiming to be a voter shall be required to sign the copy of the list of members eligible to vote provided by the Election Committee.

34.

(2)

At any time before a ballot paper is delivered to a person claiming to be a voter, the Election Officer or a person appointed by him may, of his own accord, if he has reason to doubt the identity of the person or his right to vote at the polling booth, and shall, if so required by a candidate or his polling agent, satisfy himself in any manner as he may deem advisable as to his identity.

(3)

If the Election Officer or a person appointed by him is not satisfied as to the identity of the person claiming to be a voter, he may refuse to allow such person to vote in the election.

(4)

In case permission to vote is refused, the reasons for refusal shall be recorded, and objections to such refusal if made in writing, shall also be taken on record.

Record to be kept by the Election Officer.- The Election Officer or a person appointed by him shall, at the time of delivery of the ballot paper, place a mark against the name of the voter in the list of members eligible to vote to denote that voter has received a ballot paper.

50

35.

Manner of recording of votes after receipt of ballot paper.- (1) On receiving the ballot paper, the voter shall forthwith proceed into the secret chamber set apart for the purposes and shall record his vote on the ballot paper, fold it and leave the secret chamber and insert the ballot paper in the ballot box provided for the purpose, in the presence of the Election Officer or a person appointed by him. (2)

36.

Where any ballot paper, which was delivered to a voter, is found, with or without any writing thereon, in the secret chamber, it shall be treated as cancelled.

Procedure at the election station.- (1) Polling booth or booths at an election station shall be kept open on the date of election from 9.00 a.m. to 5.00 p.m. (2)

The Election Officer shall close the polling booth or booths at an election station at the end of the day, at the hour appointed under clause (1) and no voter shall be admitted thereto after that hour.

(3)

No person shall be given any ballot paper or be permitted to vote after the hour fixed for the enclose of the poll, except the persons present within the building, tent, room or enclosure in which the polling station is situated and have not voted but are waiting to vote.

(4)

The Election Officer or the person appointed by him shall, as soon as practicable after the close of the poll, in the presence of any candidates or their polling agents who may be present, open the ballot box(es) and count the total number of votes cast, the number of valid and invalid ballot paper as well as the number of votes cast in favour of each candidate and shall prepare a statement thereof.

(5)

Any candidate or his polling agent may sign the statement if he so desires.

(6)

The Election Officer or a person appointed by him shall give a copy of the statement to the candidates or their polling agents on a written request. Thereafter, the Election Officer or a person appointed by him in the presence of a candidate or candidates or their polling agents who may be present shall seal the ballot boxed with his own seal and the seals of such candidates or polling agents as he may desire.

51

37.

Eligibility to vote by post.- (1) A member whose name is included in the list of voters and whose name is not shown under any election station shall be permitted to vote by post. (2)

A member who is residing outside Pakistan shall, notwithstanding any thing contained in these bye-laws, be eligible to vote by post for the candidate or candidates, as the case may be, of the zone of the constituency where he had his last registered address in Pakistan.

38.

Election Committee to send ballot papers by post.- At least thirty days before the date of election the Election Committee shall send by registered post to the voters eligible to vote by post, the ballot papers, together with a letter explaining the manner in which the vote shall be recorded thereon, and specify the date and hour by which it should reach the Election Committee.

39.

Ballot papers to be returned after recording votes thereon.- A voter on receiving his ballot paper sent under bye-law 38 may record his vote thereon for the contesting candidate or candidates, as the case may be, as specified in byelaw 24 and send it to the Election Committee so as to reach it before the time specified in this behalf.

40.

Issue of undelivered and fresh ballot papers.- Where a ballot paper and other connected paper sent by post under bye-law 38 are lost or damaged in transit or for any reason returned undelivered, the Election Committee may reissue them by registered post or deliver them or cause them to be delivered to the voter on his applying for the same, if it is satisfied with the reasons for such loss, damage or return.

41.

Grounds for declaring ballot papers invalid.- A ballot paper shall be declared invalid if(a)

a voter signs his name or writes any word of figure upon it or makes any mark upon it by which the ballot paper becomes recognizable or by which the voter can be identified; or

(b)

it does not bear the seal of the Election Committee; or

(c)

the cross is not marked on it; or

(d)

the cross is marked opposite the name of the candidates over and above the number of votes the voter is entitled to cast; or

52

(e)

the cross and some other sign(s) are put opposite to the name of the same candidate; or

(f)

it is unmarked or void for uncertainty.

42.

Appointment of time and place for the counting of votes.- The Election Committee shall appoint time and place for the final counting of votes and shall also give notice of such time and place in writing to all the contesting candidates.

43.

Presence of candidates at the time of counting of votes.- Every contesting shall be entitled to be present in person or to appoint a member as a representative to be present on his behalf at the time of the counting of votes.

44.

Counting of votes.- On the date notified under (3) of bye-law 11 for counting of votes and at the time and place appointed under bye-law 42, the Election Committee shall, for the purpose of counting of votes in respect of a zone of the constituency:(a)

open the cover containing the postal ballot papers received by it under bye-law 38, take out the ballot papers from each cover and record the number thereof in statement; and shall make a separate packet of these postal ballot paper;

(b)

allow the contesting candidates and their authorized representatives present at the counting an opportunity to inspect the ballot boxes and packets containing the relevant papers received from the Election Officers and their seals for satisfying themselves that they are in order; and

(c)

proceed as follows:(i)

If it is satisfied that the ballot boxes and packets containing the relevant papers which have been received are in order, it shall take up the counting of the ballot papers contained in the ballot boxes and to these shall be added the postal ballot papers;

(ii)

If it finds that any of the ballot boxes has been tampered with, it shall not count the ballot papers contained in such boxes for the purpose of election, but shall keep a record of such ballot papers for the purpose of election petitions, if any;

(iii)

The ballot papers shall be examined and the invalid ballot papers shall be rejected; 53

(iv)

It shall then count the number of votes cast in favour of each candidate;

(v)

Such number of candidates from any zone of the regional constituency as there are vacancies to be filled receiving the highest number of votes shall be declared elected but in the event of an equality of votes between two or more candidates lots shall be drawn in the presence of the contesting candidates or their authorized representatives, if any, and the candidates in whose favour lot is drawn shall be declared elected.

45.

Notification of results.- The names of all the candidates declared elected shall be officially notified by the Election Committee to the candidate and members of the Institute within fifteen days of the date of election.

46.

Election not to be invalid due to accidental omission, etc.- No election shall be deemed to be invalid merely by reason of any accidental irregularity or informality in the conduct of the election including accidental omission to send or delay in sending the ballot paper to a voter or the accidental non-receipt of, or delay in receipt of a voting paper by a voter or accidental delay or any change in the election schedule necessitate on account of any circumstances beyond control.

47.

Disciplinary action against a member in connection with conduct of election.- (1) A member shall be liable to disciplinary action by the Council if, *except as provided under bye-law 47A, in connection with election to the Council he is found to have taken part, directly or indirectly, either himself or through any person, in(i)

issuing manifestos circulars; or

(ii)

organizing parties to entertain voters

(2)

A member shall be liable to disciplinary action if he adopts any or more of the following practices with regard to the election to the Council, namely:(a)

Bribery that is to say, any gift, offer or promise of any gifts or gratification to any person by a candidate or any other person, with his connivance, with the object, directly or indirectly, or;

______________________________________________________________________ *S.R.O. 1(KE)/2005 dated 24.12.2004, published in the Extra-ordinary Gazette of Pakistan dated 04.01.2005.

54 (i) inducing a member to stand or not to stand as a candidate at an election or rewarding him for such an act or omission; or (ii) inducing a member to withdraw his candidature or rewarding such withdrawal; or (iii) inducing a voter to vote or not to vote at an election, or rewarding for such an act or omission. Explanation;- For the purpose of this clause, the term “gratification” is not restricted to pecuniary gratification or gratification estimable in money but it includes all forms of entertainment and reward. (b)

Undue influence, that is to say, any direct or indirect interference or attempt to interfere on the part of a candidate or by any other person, with his connivance, with the free exercise of any electoral rights.

(c)

The publication by a candidate or by any other person, with his connivance, of any statement of fact which is false, and which he either believes to be false or does not believe to be true or in relation to the personal character or conduct of any candidate or in relation to the candidature or withdrawal of any candidate, being a statement reasonably calculated to prejudice the prospects of that candidate’s election.

(d)

The obtaining or procuring or betting, or attempting to obtain or procure by a candidate or by any other person, with his connivance, any assistance for the furtherance of the prospects of the candidates’ election from any person serving under the Government of Pakistan or the Government of any of the Provinces other than the giving of vote by such person, if he is a member entitled to vote.

(e)

The hiring or procuring , whether on payment or otherwise, of a vehicle by a candidate or by any other person, with his connivance, for the conveyance of voters.

(f)

The receipts by a member, or an agreement by a member, to receive any gratification(i)

as an inducement or reward for standing or not standing as candidate; or

(ii)

as an inducement or reward for withdrawing his

candidature; or 55 (iii) as an inducement or reward for himself or any other person for voting or refraining from voting; or

(g)

(iv)

as an inducement or reward for inducing or attempting to induce any voter to vote or refrain from voting; or

(v)

for inducing or attempting to induce any candidate to withdraw his candidature; or

contravention or misuse of any of the provisions of these byelaws or making of any false statements knowing it to be false while complying with any of the provisions of these bye-laws.

*47A. Presentation by each candidate.- (1) The Institute may, at its discretion, organize a presentation of approximately ten minutes duration to be made by each candidate before the members at least four weeks before the date of election. Separate presentations may be arranged by the Institute for Southern Region at Karachi, and for Northern Region at Lahore and Islamabad. Provided that the Institute shall not be bound to organize such presentations at any other location. (2)

In addition to the presentations as may be arranged by the Institute, each candidate shall be allowed to submit a write up not exceeding two pages of the size 8.5 x 13 inches. The write up shall cover the ideas and views of the candidate that he has about the activities and contributions of the Institute to the profession of chartered accountants.

(3)

The write up shall be placed on website of the Institute and the same shall also be circulated by the Institute in a special bulletin to be issued by it for such purpose.

(4)

Canvassing shall not be permissible except in the following limited manner, namely;(a)

By personal visits to the members; and

(b)

By telephonic contacts with the members.

_______________________________________________________________________ *S.R.O. 1(KE)/2005 dated 24.12.2004, published in the Extra-ordinary Gazette of Pakistan dated 04.01.2005.

56

48.

Election dispute.- (1) On receipt of an application under sub-section (2) of section 10, the Council shall refer the matter to the Tribunal within thirty days of its receipt. (2)

At the time of giving its decision, the Tribunal may pass such order as to costs as it may consider appropriate.

(3)

If the Tribunal is satisfied that the application made under sub-section (2) of section 10 is not founded on valid grounds, the Tribunal may while dismissing the application, award costs to the Council. CHAPTER IV MEETINGS AND PROCEEDING OF THE COUNCIL

49.

Meetings of the Council.- The first meeting of the Council shall be held within three months of the date of its being elected and thereafter the Council shall meet at least twice in twelve months at such time and place as the President may determine.

50.

Notice of meeting.- Notice of the time and place of the meeting of the Council shall be sent to the registered address of every member of the Council not less than fourteen days before such meeting and such notice shall, so far as practicable, contain a statement of the business to be transacted at such meeting; Provided that in case of urgency a meeting may be summoned to meet within three days by the president who shall inform the members of the subject matter to be considered at the meeting and the reasons for which he considers the matter to be urgent.

51.

Special meetings.- On a requisition in writing by at least twenty-five per cent of the members of the Council, the President shall call a special meeting within four weeks of the receipt of such requisition.

52.

Presiding over meetings.- All meetings of the Council shall be presided over by the President and in his absence, by the Vice-President and, in the absence of both the President and the Vice-President, by a person elected by the members of the Council present from among themselves. 53. Quorum at meetings.- Five members of the Council shall constitute a quorum for a meeting of the Council and if a quorum is not available within half an 57

hour from the time appointed for the meeting, the meeting shall stand adjourned to such future date and time as the President may appoint. 54.

Adjournment of meeting.- Subject to the provision of these bye-laws, the person presiding over a meeting of the Council may, with the consent of the majority of the members of the Council present, adjourn the meeting from time to time and from place to place; but no business shall be transacted at any adjourned meeting other than the business left unfinished at the previous meeting. Provided that no notice and quorum shall be necessary for holding an adjourned meeting, unless it be so decided by the Council at the time of adjourning the meeting.

55.

Procedure for transaction of business.- (1) The business of the Council shall ordinarily be transacted at a meeting of the Council: Provided that the President, or a Vice-President may, in an appropriate case, circulate the papers among the members of the Council for deciding any question: Provided further that if five member of the Council require that any question be decided at a meeting, the President or the Vice-President shall withdraw the papers from circulation and have the question determined at a meeting of the Council. (2)

Where the papers relating to any question are circulated among the members of the Council, a period of not less than ten days, commencing from the date of the circulation of the papers, shall elapse before any decision is taken on the question: Provided that a decision may be taken before the expiry of such period if the opinion of all the members of the Council is received earlier.

(3)

The decision shall be in accordance with the opinion in writing of the majority of the members.

(4)

A decision taken by circulation of papers shall be communicate to all the members of the Council.

58

56.

Passing of resolution at meetings.- At all meetings of the Council and in the event of difference of opinion, the vote of the majority shall prevail unless otherwise require by the Ordinance or these bye-laws and in the event of equality of votes, the person presiding shall have a casting vote in addition to his own vote.

57.

Records of minutes.- Proper minutes shall be kept of all proceedings of the meetings of the Council and shall contain every resolution passed and decision taken at the meeting and shall be signed by the person presiding over the meeting or the meeting held next thereafter, and the minutes so signed shall be sufficient evidence on the matters stated therein.

58.

Absence of members of the Council from Pakistan.- (1) Before a member of the Council, other than a member who is in the service of the Government, leaves Pakistan for a period exceeding sixty days:(i) he shall intimate the Council the date of his departure from, and the date of his expected return to, Pakistan. (ii) If he intends to be absent from Pakistan for a period of more than six months, he shall tender his resignation or apply to the Council for leave of absence and on receipt of such application the Council may at its discretion grant leave of absence, or if it considers necessary, treat the application as the members’ resignation. (2)

If any member of the Council other than a member who is in the service of the Government, leaves Pakistan for a period exceeding sixty days without taking either of the courses mentioned in sub-clause (ii) of clause (1), the Council at its discretion may terminate his membership of the Council after giving him an opportunity of being heard. CHAPTER V MEETINGS AND PROCEEDINGS OF THE INSTITUTE

59.

Annual meeting.- The annual meeting of the Institute for transacting the ordinary annual business of the Institute (namely the receipt and consideration of the annual report of the Council and the accounts of the Institute with the auditor’s report thereon and the appointment of auditors) shall be held in Pakistan on such day and at such place as the Council may from time to time appoint:

59

Provided that a meeting shall be held in every calendar year and that not more than fifteen months shall have elapsed since the date of the previous annual meeting. 60.

Special meetings.- The Council may whenever it thinks fit convene a special meeting of the Institute and shall do so within four weeks from the receipt by the Secretary of a requisition in writing signed by not less than twenty per cent of the members stating the object of the proposed meeting.

61.

Notice of meeting.- (1) The secretary shall, not less than fourteen days before any annual or special meeting of the Institute, send to each member a notice specifying the day, hour and place of the meeting and the business to be transacted thereat.

62.

(2)

In the case of annual meeting, the Secretary shall send to each member with such notice a copy of the annual report of the Council and a copy of the accounts of the Institute with the auditor’s report thereon and particulars of all motions to be brought before the meeting under bye-law 62.

(3)

The non-receipt by any member of such notice or of any of the aforesaid documents shall not invalidate the proceedings of any meeting.

Notice of motion to be given.- A member wishing to bring before the annual meeting any motion not relating to the ordinary annual business of the Institute may do so: Provided that:-

63.

(i)

notice in writing of the proposed motion, duly endorsed by five other members entitled to vote at the annual meeting, be sent or given to the Secretary and be received by him not later than ten days before the date of the annual meeting; and

(ii)

the proposed motion relates to matters affecting the Institute or the accountancy profession.

Meetings to be presided by the President, etc.- All meetings of the Institute shall be presided over by the President and, in his absence, by the Vice-President and, in the absence of both the President and the Vice President, by a person elected by the members from amongst the members of the Council present, and in the absence of all of them, from amongst themselves. 60

64.

Quorum at meetings.- Ten members present in person shall constitute a quorum for a meeting of the Institute, and if a quorum is not available within half an hour from the time appointed for the meeting, the meeting shall stand adjourned to such future time and date as the President or in his absence the Vice-President may appoint: Provided that no quorum shall be necessary for such adjourned meeting.

65.

Adjournment of meeting.- Subject to the provisions of these bye-laws, the person presiding over the meeting of the Institute may, with the consent of majority of members present, adjourn the meeting from time to time and from place to place but no business shall be transacted at any adjourned meeting other than the business left unfinished at the previous meeting: Provided that no notice shall be necessary for holding an adjourned meeting unless it be so decided in the meeting at the time of adjournment.

66.

Voting at meetings and demand for poll.- (1) Every resolution and amendment proposed and seconded at the meeting of the Institute shall be put to vote by the person presiding over the meeting and decided by show of hands and the person presiding shall declare the decision of the meeting. (2)

In the event of an equality of votes, the person presiding shall have casting vote in addition to his own vote.

(3)

The declaration made by the person presiding under clause (1) shall be final: Provided that not less than ten members present in person and entitled to vote at the meeting may demand in writing a poll of all members in respect of that decision.

67.

Appointment of scrutineers.- At every meeting of the Institute at which a poll is demanded the meeting shall appoint two members as Honorary Scrutineers.

68.

Procedure when poll demanded.- (1) On a poll being demanded under bye-law 66, the person presiding shall forthwith, or as soon as reasonably practicable after the conclusion of the meeting at which the poll is demanded, state the resolution or amendment in form of proposition, which in his opinion, will be most suitable to ascertain the views of the members.

61

69.

(2)

Upon the substance of such resolution or amendment and upon the manner of so stating the resolution or amendment the decision of the person presiding shall be final.

(3)

The voting paper setting out the proposition so stated, together with an envelope and all necessary directions, shall, within fourteen days after the meeting, be issued by the Council to all members entitled to vote.

(4)

The members shall send the said voting papers duly completed to the Secretary sealed in the envelopes provided for such purposes so as to reach him on or before the twenty-first day after the day on which the said voting papers were sent to the members and the Secretary shall hand over the sealed envelopes to the Honorary Scrutineers.

Result of poll.- (1) The Honorary scrutineers shall, within forty-eight hours from the last date fixed for the return of the voting papers, submit a report to the person presiding detailing:(i)

the result of the voting, and

(ii) the votes rejected and the reasons for such rejection. (2)

The person presiding shall send a copy of the report to each member as soon as practicable and in the event of equality of votes, he shall exercise a casting vote in addition to his own vote, and convey to the members the manner in which his casting vote has been exercised.

(3)

The report of the Honorary Scrutineers as to the result of the voting, along with the casting vote, if any, shall be conclusive.

70.

Demand for poll not to prevent other business.- The demand for a poll at a meeting shall not prevent the transaction of any business other than that on which the poll has been demanded or any business directly dependent thereon.

71.

Minutes of the meeting.- (1) Proper minutes shall be kept of all proceedings of the meetings of the Institute and shall contain every resolution passed and decision taken at the meeting. (2)

The minutes shall be signed by the person presiding over the meeting or the meeting held next thereafter, and the minuets so signed shall be sufficient evidence of matters stated therein.

62

CHAPTER VI STANDING AND OTHER COMMITTEES 72.

Committees of the Council.- (1) The Council shall constitute from amongst its members the following standing committees namely:(i)

The Executive Committee.

(ii)

The Examination Committee, and

(iii) The Investigation Committee. (2)

73.

The Council may also form such other committees and Boards* from amongst its members, the members of the Institute and other persons as it deems necessary, for the purpose of carrying out the provisions of the Ordinance and these bye-laws, and any Committee or Board so formed, may with the sanction of the Council, co-opt such other members of the Institute or other persons, not exceeding two-third of the members of the Committee or Board, as the Committee or Board thinks fit, and any member so co-opted shall be entitled to exercise all the rights of a member of the Committee or Board.

Executive Committee.- (1) The Executive Committee shall consist of the President and Vice-President or Vice-presidents, ex-officio, and not less than three other members of the Council elected by the Council. (2)

The Executive Committee shall perform the following functions, namely:(a)

Maintenance of the office of the Institute and for this purpose the Executive Committee may employ, suspend, discharge or reemploy the necessary staff other than the Secretary on such terms and conditions as it may deem fit.

________________________________________________________________________ *S.R.O. 77(KE)/2005 dated 11.05.2005, published in part-II of Extra-ordinary Gazette of Pakistan dated 30.05.2005.

63

(b)

Maintenance of true and correct accounts of all receipts and payments on behalf of the Institute and the matters in respect of which such receipts and payments take place and of all the property, securities, debts, funds and liabilities of the Institute.

(c)

Maintenance of the Register, Register of Principals, Register of Students and all other registers which are prescribed by the Ordinance or these bye-laws.

(d)

Custody of the property, assets and funds of the Institute.

(e)

Investment of the spare funds of the Institute in securities approved by the Council.

(f)

Disbursements from the funds on account of expenditure from the income or the capital in accordance with the estimates previously sanctioned by the Council: Provided that in emergent cases expenditure in excess of the estimates may be incurred by the Committee but such excess expenditure shall be brought to the notice of the Council as its next meeting.

(g)

Admission of associates and fellows, removal and restoration of names of members, issue and cancellation of certificates of practice, permission to members to engage in management consultancy, issue of certificates of membership, publication of list of members and issue of journal and other publications of the Institute.

(h)

Any other function delegated to it by the Council: Provided that the Council shall always have the power to review any decision of the Executive Committee in exercise of its aforesaid function.

74.

Examination Committee.- (1) The Examination Committee shall consist of the President and the Vice-President or Vice Presidents, ex-officio, and not less than three other members of the Council elected by the Council. (2)

It shall perform the following functions, namely:(a)

All the functions of the Council in regard to holding of examinations, admission thereto, selection and appointment of examiners, prescription of books for the guidance of candidates and declaration of results, fixation of remuneration of the

examiners, assistant examiners, superintendents of the 64 examinations and other and deal with other matter arising out of the holding of examinations. (b)

According recognition to coaching institutions for preparation of candidates for the examinations of the Institute subject to such conditions, as it may deem fit.

(c)

Maintenance of proper standard of conduct at the examinations.

(d)

Providing of proper facilities where the Committee may consider necessary, to the students to obtain coaching in the subject in which they are to be examined by the Council.

(e)

All functions in relation to students, except as otherwise provided in these bye-laws.

(f)

Any other functions delegated to it by the Council.

Provided that the Council shall always have the power to review any decision of the Examination Committee in exercise of its aforesaid functions. 75.

(1)

The Investigation Committee shall consist of.(a)

the President and the Vice-President or Vice-Presidents, exofficio;

(b)

not less than three other members of the Council, elected by the Council; and

(c)

two other persons (not being members of the Council), nominated by the Council, of whom:(i) one shall be a person who has exercised the powers of, or is or has been, a judge of High Court or who is or has been an advocate of a High Court and is qualified to be a Judge of a High Court; and (ii) the other one shall be a person who, in the opinion of the Council is suitable for such nomination.

65

Provided that the persons under clause (c) shall be nominated for a period of four years or till the completion of the tenure of the Council, whichever is earlier. (2)

It shall perform the functions assigned to it under the Ordinance and such other functions as may be delegated to it by the Council.

76.

Chairman of the Standing Committees.- The President shall be the Chairman of every Standing Committee and if, for any reason, he is prevented from attending to the affairs of a Committee, the Vice President and, in the absence of the Vice President, a member of the Committee elected by the members present shall act as Chairman of the Committee.

77.

Term of office of members of the Committees.- A member of a Standing Committee shall hold office for one year from the date of his election and shall be eligible for re-election: Provided that he is a member of the Council at the time of such election: Provided further that notwithstanding the expiry of the tenure of his office, a member shall continue to hold his office till such time as a new member has been elected in his place.

78.

Meetings of the Committees.- The president or Vice-President at any time may, and on requisition by any two members of a Committee or Board* shall, call a meeting of the Committee or Board.*

79.

Notice of meeting.- Notice of the date, time and place of the meeting of every Committee or Board* shall be sent to the registered address of every member of the Committee or Board* not less than fourteen days before such meeting and such notice shall, so far as practicable, contain a statement of the business to be transacted at such meeting. Provided that in case of urgency a meeting may be summoned to meet within three days by the President or Vice-President who shall inform the members of the Committee or Board* of the subject matter to be considered at the meeting and the reasons for which he considers the matter to be urgent.

________________________________________________________________________ *S.R.O. 77(KE)/2005 dated 11.05.2005, published in Part-II of Extra-ordinary Gazette of Pakistan dated 30.05.2005.

66

80.

Quorum, etc., at meetings.- (1) Three members of a Committee present in person shall constitute a quorum for a meeting of the Committee or Board.* (2)

81.

The procedure laid down for adjourned meetings for want of quorum in respect of the Council shall mutatis mutandis apply to such meetings of the Committees or Boards.*

Procedure for transaction of business.- (1) The business of every Standing Committee shall ordinarily be transacted at a meeting of the Committee. Provided that the President or a Vice-President may, in an appropriate case, circulate the papers among the members of the Committee for deciding any question. Provided further that if there members of the committee require that any question be decided at a meeting, the President or the Vice-President shall withdraw the papers from circulation and have the question determined at a meeting of the Committee. (2)

Where the papers relating to any question are circulated among the members of the Committee, a period of not less then ten days, commencing from the date of the circulation of the papers, shall elapse before any decision is taken on the question: Provided that a decision may be taken before the expiry of such period if the opinion of all the members of the Committee is received earlier.

(3)

A decision taken by circulation of papers shall be communicated to all the members of the Committee.

82.

Casting vote.- All questions before a Committee or Board* shall be decided by a majority of votes and in the event of equality of votes, the person presiding shall have a casting vote in addition to his own vote.

83.

Secretary of the Committees.- The Secretary of the Institute shall be the Secretary for each Committee or Board.*

84.

Minutes.- The Secretary shall maintain a record of all business transacted by the Committee or Board*, whether by circulation of papers or at a meeting of the Committee or Board.*

________________________________________________________________________ *S.R.O. 77(KE)/2005 dated 11.05.2005, published in Part-II of Extra-ordinary Gazette of Pakistan dated 30.05.2005.

67

CHAPTER VII REGIONAL COMMITTEES 85.

86.

Regional Committees.- (1) There shall be a Regional Committee for every regional constituency. (2)

Each Regional Committee shall consist of six elected members comprising five members from Zone A and one member from Zone B in both the regional constituencies.

(3)

The following shall be the territorial limits of the regional constituencies:Southern Region comprising the Province of Sind to be known as Zone ‘A’ and the Province of Baluchistan to be known as Zone ‘B’.

(ii)

Northern Region comprising the Province of the Punjab including Federal Capital of Islamabad to be known as Zone ‘A and the North West Frontier Province, Tribal Areas and Azad Kashmir to be known as Zone ‘B’.

Admission and removal from Regional Register.- (1) Each Regional Committee shall maintain a Regional Register in which shall be entered the names of all the members of the Institute in a Region. (2)

87.

(i)

If the name of a member is removed from the Register maintained by the Council, it shall stand removed from the Regional Register and if he is a member of the Regional Committee, he shall also cease to be such member.

Resignation from the Regional Committee and casual vacancies.- (1) Any member of the Regional Committee may at any time resign his membership by writing under his hand addressed to the Chairman of the Regional Committee concerned and the seat of such member shall become vacant when such resignation is accepted by the Regional Committee. (2) A member of the regional Committee shall be deemed to have vacated his seat if he is declared by the Regional Committee to have been absent without sufficient excuse from three consecutive meetings of the Regional Committee.

68

(3)

Any casual vacancy in the Regional Committee shall be filled by a fresh election and the person so elected shall hold office until the dissolution of the Regional Committee: Provided that no election shall be held to fill a casual vacancy occurring within six months prior to the date of the expiry of the duration of the Regional Committee and such casual vacancy shall be filled by nomination by the Regional Committee with the approval of the Council.

(4)

No act or proceeding of the Regional Committee shall be invalid merely on the ground of the existence of any vacancy in, or defect in the constitution of the Regional Committee.

88.

Date of election.- The Council shall deter mine and notify the date of election to the Regional Committees.

89.

Election to the Regional Committees.- (1) election to the Regional Committee shall be conducted by the Council or the Council may direct the Regional Committees to hold the election if it considers desirable to do so. (2)

Subject to the other provisions of these bye-laws a member of not less then three years’ continuous standing with the Institute on the date of election shall be eligible to stand for election to the Regional Committee from the zone of the constituency in which his name is included.

*(3)

The provisions relating to elections to the Council in regard to the qualifications of members to vote, disciplinary action, presentations by candidates, the procedure for elections, the declaration and the notification of election results shall mutatis mutandis be applicable to the elections to the Regional Committees.

Provided that the Election Committee for the purpose of elections to the Regional Committee shall be appointed by the Council. 90.

Duties and functions of Regional Committees.- (1) The Regional Committees shall be at all times function subject to the control, supervision and direction of the Council.

________________________________________________________________________ *S.R.O. 1(KE)/2005 dated 24.12.2004, published in Part-II of Extra-ordinary Gazette of Pakistan dated 04.01.2005.

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(2)

(3)

In particular and without prejudice to the generality of the foregoing provision, the duties of the Regional Committees shall be(a)

to advice the Council on all matters referred to it by the Council and to offer such other help as may be required;

(b)

to make representations to the Council in connection with matters of professional and business interest in the region and to offer suggestions for raising the standard and status of the profession and for improvement of the law applying to it;

(c)

to supply necessary information to members or to the prospective students for training and examination;

(d)

to recommend either on their own motion, or on a reference by the Council, names for inclusion in the panel of examiners;

(e)

to arrange, if found practicable, for the coaching of candidates for the aforesaid examination in the various centers of the region and to maintain an up-to-date and well-equipped library and reading-room for the use of the members and students;

(f)

to run study circles with different sub-committees or branches or arrange for regular meetings of the members for discussion on topical subject affecting the accountancy profession;

(g)

to maintain an Employment Register for securing suitable employment for chartered accountants and finding suitable chartered accountants for employers;

(h)

to carry out such other functions as may be entrusted from time to time to the respective Regional Committees by the Council.

The Council may take such action and impose such sanctions against a Regional Committee as it deems fit if it is satisfied after giving proper hearing to the Regional Committee that the Regional Committee has not carried out any of its directives or has acted detrimentally to the interest of the Institute.

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91.

92.

Office bearers in the Regional Committees.- (1) Each Regional Committee shall elect at its first meeting, to be held within *three months of its formation, a Chairman and a Secretary for that Committee from amongst its members*. Provided that a Regional Committee shall not hold its first meeting before the first meeting of the Council. (2)

The Chairman and the Secretary shall hold office for a period of one year from the date on which they are elected but so as not to extend beyond their term of office as a member of the Regional Committee” and, subject to their being a member of the Regional Committee at the relevant time, they shall be eligible for re-election.

(3)

The Chairman of the Regional Committee shall be the Chief Executive of the Regional Committee.

Finance and accounts.- (1) Each Regional Committee shall be financed by such fees as the Council may fix and direct to be paid to the Regional Committee and such aid as the Council thinks fit to grant but no Regional Committee shall borrow or obtain credit without the previous sanction of the Council. (2)

The funds of the Regional Committee shall be utilized for such purposes as may from time to time be sanctioned by the Regional Committee: Provided that no such funds shall be applied either directly or indirectly for payment to the members of the Regional Committee except for reimbursing them for any expenses incurred by them in connection with the business of the Regional Committee.

(3)

The Secretary of the Regional Committee shall be responsible for the maintenance of its accounts which shall be audited by a member belonging to the region who is not a member of the Committee or a member in partnership with a member of the Committee, as may be appointed at the annual general meeting of the members of that region.

(4)

A copy of the audited accounts and report, as adopted at the annual general meeting, shall be sent to the Council not later than one month from the date of that meeting.

________________________________________________________________________ *S.R.O. 1(KE)/2000 dated 29.5.2000, published in Part-II of Extra-ordinary Gazette of Pakistan dated 30.06.2000.

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93.

Meetings of Regional Committees.- The meetings of Regional Committees shall be held and conducted in the manner prescribed for the meetings of the Council and all provisions applying to meetings of the Council shall mutatis mutandis apply to the meetings of the Regional Committee. Provided that the quorum at a meeting of a Regional Committee shall be three members present in person.

94.

Meetings of the members of the regional constituency.- The meetings of the members of the regional constituencies shall be held and conducted in the manner prescribed for the meetings of the Institute and all provisions applying to the meetings of the Institute shall mutatis mutandis apply to the meetings of the regional constituency. Provided that-

95.

(i)

the quorum at a meeting of the regional constituency shall be five members present in person:

(ii)

the demand for a poll at any meeting shall have to be made in writing by at least five members present in person or by proxy and entitled to vote at that meeting.

Duration of the Regional Committee.- Unless earlier dissolved under bye-law 96, the duration of the Regional Committee elected shall be four years from the date of the first meeting of the committee: Provided that, notwithstanding the expiration of the duration of the committee, it shall continue to exercise its functions until a new Committee is elected in accordance with the provisions of these bye-laws: Provided further that the Council may, if in its opinion circumstances so warrant, extend or shorten the life of a Regional Committee by a notification in this behalf: Provided further that the duration of the Committee in office at the time these bye-laws come into force shall be three years from the date of the first meeting of the Committee.

96.

Dissolution of a Regional Committee.- (1) A Regional Committee shall stand dissolved if.-

72

(i)

the members of the regional constituency in a general meeting pass a resolution for its dissolution by a majority of three-fourth of its members; or

(ii)

the Council, after giving proper hearing to the Regional Committee decides to dissolve the Regional Committee.

(2)

On the dissolution of a Regional Committee, all its property, assets and funds shall vest in the Council until such time as the new Regional Committee is elected and inducted into office. CHAPTER VIII STUDENTS

97.

Admission of students as trainees.- A principal *or training organization shall, before accepting a student for training satisfy *that such student: (i)

is not less than sixteen years of age on the date of commencement of his training:

(ii)

has passed or obtained exemption from Pre-entry Proficiency Test of the Institute:

(iii)

has passed or obtained exemption from Basic Accountancy Course Comprehensive Examination or Foundation Examination or Foundation (Modules A and B) and Intermediate (Modules C and D) Examinations of the Institute; or

(iv)

is a graduate in second Division or equivalent and has passed Modules A, B, C and D of the Foundation and Intermediate Examinations of the Institute; or

(v)

is a graduate in second Division or equivalent and has passed Pre-entry Proficiency Test; or

(vi)

is a graduate in first Division or equivalent and has obtained exemption from Pre-entry Proficiency Test; or

(vii)

holds a Master’s degree in second Division or equivalent and has obtained exemption from Pre-entry Proficiency Test.

_________________________________________________________________ *S.R.O.12(KE)/2006 dated 27.01.2006, Part-II, Extra-ordinary Gazette of Pakistan dated 04.02.2006.

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98.

Probationary period.- (1) A principal *or training organization shall keep a student on probation for a period of two months and if the student completes the probation period successfully, he will be registered as a student. (2)

99.

Period of training and registration of training contract.- (1) Every student shall be required to undergo a specified period of training **as may be determined by the Council from time to time. (2)

100.

The probation period served under clause (1) shall be treated towards the total period of studentship required to be completed under these byelaws.

The training contract of every student shall, within three months of the commencement of the probation of the student and within one month after execution thereof (or within such longer period as the Council may, in its discretion, allow in any particular case), be lodged with the Institute to be registered, together with a copy of the training contract for retention by the Institute and with such evidence as to age and qualifications as may be required and such registration fee as may be *determined by the Council in this behalf shall be paid to the Institute.

Provisions to be included in training contract.- The Council may from time to time prescribe provisions which shall be included in training contract and the training contracts executed after date of such prescription shall include the said provisions and no training contract not containing the said provision shall be registered by the Institute. Provided that the Council may, in its discretion, and on the application of the parties to the training contract, waive the inclusion of some or all of the said provisions and register the training contract notwithstanding that some or all of the said provisions are not included therein.

101.

Premium.- No premium shall be charged from a student by his principal *or training organization while registering his training contract.

102.

*Criteria to train students.- (1) No member shall be permitted to engage students unless he is authorized as a training organization and meets the criteria as laid down by the Council in Training Regulations and Guidelines and on payment of such fees as may be determined by the Council:

______________________________________________________ *S.R.O.12(KE)/2006 dated 27.01.2006, Part-II, Extra-ordinary Gazette of Pakistan dated 04.02.2006. **S.R.O. 78(KE)/2005 dated 12.05.2005 published in the Part-II of Extra-ordinary Gazette of Pakistan dated 31.05.2005.

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Provided that the permission to train students shall stand withdrawn if the training organization fails to comply with the laid down criteria. (2)

No member shall be entitled to train students unless he has been in practice as a chartered accountant either independently or in partnership with a firm of chartered accountants for a period of not less than three years and has been permitted by the Council, on application made to it, and on payment of such fee as may be determined by the Council in this behalf and on compliance with the criteria laid down by the Council to train the students:

Provided that the permission to train students shall stand withdrawn if the member does not apply to register as a training organization or does not comply with the criteria given in the Training Regulations and Guidelines by dates determined by the Council. 103.

Transfer and execution of fresh training contracts.- (1) Training contracts may, by agreement between the parties thereto and subject to the permission of the Council, be transferred to another *principal or training organization entitled to train a student and shall be subject to the provisions of bye-law 99 regarding registration and the payment of fee and the training contract of such student shall be filed with the Institute within one month of the date of transfer. (2)

If the principal ceases to practice or resigns from membership, the training contract may be transferred with the permission of the Council to another *principal or training organization and if the principal *or training organization dies or is excluded or suspended from membership, the student may enter into a fresh training contract, with the permission of the Council, with another principal for the remainder of his term of service and the fresh training contract shall be registered with the Institute within one month of the date of the making thereof or of transfer of within such longer period as the Council in its discretion may allow, but shall not require the payment of any fee: Provided that in the case of death, retirement, resignation or removal of a principal who is partner of a firm, the training contract of a student of such principal *or training organization shall be deemed to be the training contract of the successor of such principal or any other partner of the firm as the firm may decide, whether or not such successor or partner is entitled to train students:

_________________________________________________________________ *S.R.O.12(KE)/2006 dated 27.01.2006, Part-II, Extra-ordinary Gazette of Pakistan dated 04.02.2006.

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Provided further that where fresh training contracts are entered into, the Council may in its discretion allow service with two or more members to be deemed to be continuous service on such terms and conditions as it may think fit. *(2A) in case the training organization ceases to exist on account of withdrawal of authorization as training organization or death, retirement, resignation or removal from membership of a sole-proprietor, the student may enter into fresh training contract with another training organization with the permission of the Council for the remainder of his term of training and the fresh training contract shall be registered with the Institute within one month of the date of the making thereof or transfer of within such longer period as the Council in its discretion may allow, but shall not require the payment of any fee. (3)

Where there is a dispute between the student and the principal *or training organization regarding the transfer of the studentship, the aggrieved student may apply to the Council for permission to transfer the studentship to another principal *or training organization.

(4)

The Council may, after giving the student and the principal *or member responsible for training an opportunity of being heard, permit the student to have him transferred to another principal subject to such conditions as it may deem necessary: Provided that the Council may appoint a sub-committee to decide this matter after giving the student and the member *responsible for training a hearing in this behalf.

(5)

104.

On such permission, the training of the student shall be transferred to another principal *or training organization, subject to the provisions of bye-law 99 regarding registration and payment of fees and such other conditions as the Council may deem fit.

Maximum number of students to be trained by a *principal or training organization.-**(1) No principal shall have under his training at the same time more than fifteen students:

__________________________________________________________________ *S.R.O.12(KE)/2006 dated 27.01.2006, Part-II, Extra-ordinary Gazette of Pakistan dated 04.02.2006. *S.R.O.25(KE)/2007 dated 17.04.2007, Part-II, Extra-ordinary Gazette of Pakistan dated 19.04.2007.

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Provided that a student taken for training by a principal under clause (2) of byelaw 103 shall not be counted in the number of trainees specified in this bye-law. Provided further that a principal who is a fellow member of the Institute may train five additional students. *(2)

Each training organization shall be authorized to engage up to a maximum of **fifteen students per partner who is authorized to train students: **Provided if a partner authorized to train students is also a fellow member of the Institute, he may train five additional students.

**(3)

105.

In case a member is a partner in more than one firm of chartered accountants or training organization his collective entitlement of students as a partner of all such firms shall not exceed the authorized maximum entitlement mentioned above.

Permission to train additional students.- A principal **or training organization may, in addition to number of students permitted under **bye-law 104, engage ten extra students for each of his partners, not entitled to train students and for each member employed on full-time basis in his service: Provided that a principal **or training organization shall not be entitled to train additional students for a partner or a member employed, on full-time basis in his service, if such partner or member has any professional connection whatsoever with any other accountant or a firm of accountants entitled to act as auditor or auditors of companies.

*106.

Students not to engage in other business.- (1) A student shall throughout his term of training serve in his principal’s office or training organization on his principal’s business or, as the case may be, training organization’s business of public accountancy and he shall not, during such term of training, practice as a public accountant or engage in any other business or occupation: Provided that a student may, with the consent of his principal or training organization,(i)

have leave of absence, for examination preparation and any other purpose for a total period not exceeding:-

__________________________________________________________________ *S.R.O.12(KE)/2006 dated 27.01.2006, Part-II, Extra-ordinary Gazette of Pakistan dated 04.02.2006. **S.R.O.25(KE)/2007 dated 17.04.2007, Part-II, Extra-ordinary Gazette of Pakistan dated 19.04.2007.

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(ii)

(a)

one hundred and eighty days in respect of trainee students who has not passed or obtained exemption from Foundation Examinations (FE-1 and FE-2) or from Modular Examinations (Modules A, B, C and D) prior to commencement of training period.

(b)

one hundred and thirty days in respect of trainee student, who pass or obtain exemption from Modular Examinations (Module, A, B, C and D) prior to commencement of training period.

spend a period not exceeding twelve months in all in such industrial commercial or other suitable organisation as the Council may approve and subject to such conditions and control as the Council may impose or exercise. Provided further that in suitable cases the Council may sanction to a student leave in excess of prescribed limit on the condition that he shall be required to undergo training in lieu of the excess leave as sanctioned by the Council.

(2)

Every Principal and training organization shall on completion, discontinuation or termination of a student send a report forthwith to that affect to the Secretary.

107.

Power to terminate the training of student.- *(1) A principal or training organization may terminate the training of a student if he is guilty of misconduct, misbehaviour or breach of any of the provisions laid down in the training contract or fails to progress satisfactorily as per Training Regulations.; (2)

A student aggrieved by the termination of his training under clause (1) may, within thirty days of such termination, prefer an appeal to the Council.

(3)

On receiving appeal under clause (2), the Council shall refer it for report to any one of its members.

(4)

The member to whom an appeal is referred shall, after giving the parties an opportunity of being heard, submit a report together with his recommendation to the Council.

(5)

The decision of the Council taken after considering the recommendation of the member shall be final and binding on both parties. 108. Registers to be maintained.- The Council shall maintain a Register of principals *and training organizations and a Register of students in which the names of principals and the students shall, respectively, be entered. __________________________________________________________________ *S.R.O.12(KE)/2006 dated 27.01.2006, Part-II, Extra-ordinary Gazette of Pakistan dated 04.02.2006.

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CHAPTER IX TRAINING AND EXAMINATION 109.

Conditions to become a member of the Institute.- (1) A person shall not be eligible for enrolment on the Register unless.(i)

he has passed all the prescribed examinations of the Institute or has been granted exemption from such examinations under these Bye-laws: or

(ii)

he has passed the Intermediate and Final Examinations or examinations equivalent thereto from such accounting bodies outside Pakistan the examinations and training of which have been recognized equivalent to the examinations and training prescribed under these bye-laws:

Provided that if such member desires to start practice as a Chartered Accountant or Management Consultant, he shall pass the papers of Advanced Taxation and Corporate Laws and Practices of the Professional examinations: Provided further that the condition in the above proviso shall not apply to a person who has either started or completed articleship or training contract outside Pakistan before these bye-laws came into force. (2)

A person referred to in sub-clause (i) of clause (1) shall produce a certificate from a principal *or training organization in such form as the Council may direct that he has completed the requisite period of training:

Provided that the period of training required to be completed by an articled clerk whose deed of articles was executed under the Chartered Accountants Bye-Laws, 1961, shall remain unchanged: Provided further that the period of training required to be completed by an audit clerk registered under the said Bye-Laws shall be reduced by one year”; and

_________________________________________________________________ *S.R.O.12(KE)/2006 dated 27.01.2006, Part-II, Extra-ordinary Gazette of Pakistan dated 04.02.2006.

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(3)

A person referred to in sub-clause (ii) of clause (1) shall produce a certificate in such form as the Council may require that he has completed training under articles or a training contract outside Pakistan with a member of the respective institute for such period as is prescribed under its regulations as prerequisite to become its member: Provided that a person who has completed a part of the training outside Pakistan under articles or a training contract with a recognized Institute shall be required to complete only the balance of period of training in Pakistan to make the total period as prescribed under these Bye-Laws.

(4)

110.

111.

The Council may in suitable cases condone a break in the training of a student in order to keep continuity in training.

Study courses and materials.- (1) The Council may prescribe study material or correspondence course and may require students to attend the tutorial courses. (2)

Unless otherwise exempted, a student shall not be admitted to any examination of the Institute unless he attends and completes the prescribed tutorial course and has obtained the requisite study material or completed the correspondence course.

(3)

The Education and Training Committee may, with the approval of the Council, exempt a person from complying with all or any of the conditions specified in sub-clause (2).;

Time and places of examinations.- (1) All examinations shall be held twice a year at such time as the Examination Committee may from time to time direct and at such place or places as it shall from time to time appoint. (2)

The dates and places of the examinations and other particulars shall be notified at least one month before the dates of the examinations.

112.

Registration of examinees.- Any person desiring to appear in an examination of the Institute shall get his name registered with the Institute in such manner and on payment of such annual fee as may be determined by the Council from time to time in this behalf.

113.

Subject and syllabus of the examinations.- The examinations shall be conducted in the subject and syllabus or as may be determined by the Council from time to time.

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Provided that the subject and syllabus of the examinations shall be effective from the date and in the manner as may be notified by the Council in the official Gazette. 114.

Application for admission to an examination.- (1) Applications for admission to an examination shall be in such form as may be prescribed by the Council, a copy of which may be obtained from the Institute or the Regional Committees or from such other agencies as may be specified by the Council. (2)

Every application under clause (1) together with such documentary evidence as may be required and the prescribed fee shall be sent so as to reach the Institute in accordance with the direction given by it in the matter.

115.

Admission fee for examinations.- Every candidate for admission to an examination conducted by the Institute shall pay such fees as may be prescribed by the Council from time to time.

116.

Refund of examination fee.- The fee paid by a candidate who has been admitted to an examination shall not be refunded: Provided that where a candidate applies to the Examination Committee for refund of fee before the last date to apply for admission to an examination on the ground that he is prevented from attending an examination on account of circumstances beyond his control, the Examination Committee may refund the fee paid by such candidate.

117.

Examination results.- (1) The Examination Committee shall consider the reports of the examiners and moderators on each examination and may accept them or reject them or may accept them subject to any modification or alteration which may seem desirable. (2)

The Examination Committee shall then report to the Council the result of each examination and upon the approval and adoption by the Council of the report of the Examination Committee, a list of successful candidates shall be published in the official Gazette.

(3)

Every candidate shall also be individually informed of his result.

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118.

Failure of candidates at examinations.- (1) A candidate who has failed to pass any examination or group or part of examination, may offer himself for that examination or group or part of examination, as the case may be, on any subsequent occasion in such manner and within such period as the Council may determine: Provided that a candidate who is successful in all papers except in one paper or a section of paper of a group or part thereof; he may, subject to approval of the Council, be allowed to take that paper or, as the case may be, section of a paper again instead of re-appearing in all the papers: Provided further that such candidate shall be allowed to clear the said paper or, as the case may be, section in two attempts by appearing in two immediate succeeding examinations. Provided also that in case a candidate is unable to avail an attempt due to circumstances beyond his control to the satisfaction of the Examination Committee, it may permit such a candidate to defer the attempt to an immediately succeeding attempt. (2)

119.

A candidate shall retain a pass in a paper(s) or part(s) of a paper(s) under the Modular scheme of examinations as the Council may determine from time to time.

Examination Certificates.- Every candidate passing or obtaining exemption from any examination of the Institute shall be furnished with a certificate to that effect, in the form to be specified by the Council and such certificate shall be signed by the President and the Secretary. ENTRANCE EXAMINATION

120.

Admission to Pre-entry Proficiency or Aptitude test.- A candidate seeking admission to Pre-entry Proficiency or Aptitude Test of the Institute shall be required to fulfill such conditions as may be specified by the Council from time to time. FOUNDATION AND INTERMEDIATE EXAMINATIONS

121.

Admission to Foundation Examinations.- No person shall be admitted to Foundation Examinations, comprising of Module A and Module B unless he has passed or obtained exemption from Pre-entry Proficiency or Aptitude 82

Test subject to Exemption Policy and fulfillment of eligibility conditions as laid down by the Council from time to time. 122.

Admission to Intermediate Examinations.- No person shall be admitted to Intermediate Examinations comprising of Module C and Module D unless he has passed or obtained exemption from the Foundation Examinations subject to Exemption Policy and fulfillment of eligibility conditions as laid down by the Council from time to time.

123.

Exemption Policy.- The Council may, in accordance with its policies, consider requests for exemption or credits from candidates who have passed certain examinations of other recognized accountancy bodies or recognized educational institutions, for appearing in Pre-entry Proficiency or Aptitude Test or examinations as a whole or part thereof and allow such exemption or credits from papers of examinations subject to such conditions as the Council may determine.

FINAL OR PROFESSIONAL EXAMINATIONS 124.

Admission to Final or Professional examinations.- (1) No person shall be admitted to Professional Examinations – 1 (PE-1) or Module E of Final Examination under the Modular Scheme of Final Examinations effective from the December 2002, unless:(a)

he has passed or has obtained exemption from the examinations of Intermediate or Basic Accountancy Course or Foundation (FE-1) and FE-2) or Modules A, B, C and D:

(b)

he has completed such period of training as a student as determined by the Council ; and

(c)

six months have elapsed since he was declared completely successful in Foundation (FE-1 and FE-2) or Intermediate Examinations (Modules C and D).

(2)

No person shall be admitted to Professional Examination from Professional Examination-2 (PE-2) or Module F of Final Examination unless(a)

he has passed or has obtained exemption from Professional Examination – 1 (PE-1) or Module E of Final Examination *or has cleared three papers of module E; and

________________________________________________________ *S.R.O.39(KE)/2007 dated 02.07.2007, Part-II, Extra-ordinary Gazette of Pakistan dated 14.07.2007.

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(b)

he is serving the last twelve months of the period of training as a student from the first day of the month in which the examination is held.

Provided that if a candidate who has passed from outside Pakistan any part or parts of the final examination or an examination equivalent thereto of the accounting bodies the examinations of which have been recognized by the Council as equivalent to a part of the professional examination prescribed under these bye-laws, he shall be exempted from passing such part or papers of the professional examination as the Council may decide. 125.

Certificate of service and fitness.- Every student desiring to present himself for any examination for first time shall produce to the Examination Committee a certificate from his principal *or training organization to the effect that he is a fit and proper person to be admitted to the examination and the specific period of training which has been duly completed by him. CHAPTER X MISCELLANEOUS

126.

Finances.- (1) All moneys received by the Institute shall be paid into an account of the Institute at its bankers and cheques drawn upon its bankers shall be signed by two members of the Council or by a member of the Council and the Secretary or the persons authorized to sign cheques shall have been named by a resolution of the Council. (2)

The funds of the Institute shall be employed for such purposes as may from time to time be sanctioned by the Council and all funds not needed immediately for the ordinary purposes of the Institute may be invested by the Council in any government security or securities or in any other security or securities approved by the Federal Government.

(3)

The Council may from time to time borrow from a scheduled bank or from the Federal Government any money required for meeting its liabilities on capital account or for the purpose of meeting current liabilities pending the receipt of income.

_________________________________________________________________ * SRO 12(KE)/2006 dated 27.01.2006 Part-II Extra-ordinary Gazette of Pakistan dated 04.02.2006

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127.

(4)

The Council shall keep proper accounts of all income and expenditure and have the annual account duly audited.

(5)

A copy of the audited accounts and the report of the Council for that year shall be forwarded to the Federal Government as soon as practicable after its adoption at the annual meeting of the Institute.

Audit of accounts of the Institute.- (1) The members at each annual meeting shall appoint two auditors who shall be members in practice at such remuneration, if any, as the meeting may determine. (2)

No member of the Council or a member who is in partnership with such a member shall be eligible for appointment as auditor.

(3)

In the event of any vacancy, occurring in the office of auditor between two annual meetings or in the event of a vacancy not being filled at an annual meeting, the said vacancy may be filled by the Council at a meeting summoned with notice of the object: Provided that during such vacancy the continuing auditor may act alone.

128.

(4)

The auditors shall hold office until the next annual meeting but shall be eligible for re-appointment.

(5)

The auditors shall be nominated by two members of the Institute and such nomination shall be signed by the members nominating and by the candidate, and must reach the office of the Institute at least ten days before the annual meeting.

(6)

The auditors who are in office shall be deemed to be nominated at each annual meeting unless they have intimated in writing to the Secretary their desire not to be re-elected.

(7)

Notice shall be given to members and epecially to the retiring auditors of the names of all other persons nominated for appointment.

Powers and duties of the President and Vice-President or Vice-Presidents.(1) The President shall exercise such powers and perform such duties as are contained in the provisions of the Ordinance and these bye-laws and as may be delegated by the Council or entrusted by the Standing Committees from time to time.

85

129.

(2)

The President or a Vice-President may direct any business to be brought before the Council or the Standing Committees for consideration.

(3)

If the Office of the President is vacant or if the President for any reason is unable to exercise the powers or perform the duties of his office the Vice-President or one of the Vice-Presidents shall act in his place and shall exercise the powers and perform the duties of the President.

Powers and duties of the Secretary.- (1) Subject to the provisions of the Ordinance and these bye-laws and under the general supervision of the President, the Council and the Standing Committees concerned, the Secretary shall be incharge and administrative head of the office of the Institute. (2)

In particular and without prejudice to the generality of the foregoing power, the powers and duties of the Secretary shall include: (i)

the management of the office of the Institute and attending to all correspondence and other matters relating to it;

(ii)

enrolment of associates, admission as fellows, removal from the membership owing to death, restoration of membership, issuing notifications therefore and the signing of notifications on behalf of the Council;

(iii)

sanctioning and renewing of certificates of practice for associates and fellows and cancelling of certificates of practice at the request of members;

(iv)

maintenance of all the Registers, documents and forms as required by the Ordinance and these bye-laws;

(v)

the management of all the property of the Institute;

(vi)

incurring revenue and capital expenditure within the limits sanctioned by the Council or the Standing Committees, receive moneys due to the Institute and issue receipts therefore; pay staff salaries and allowances; maintain or cause to be maintained proper accounts and deliver the books of accounts and information to the Institute’s auditors appointed by the Council for the purpose of audit of the accounts of the Institute;

(vii)

exercising of disciplinary control over the staff except dismissal which should have the sanction of the President;

(viii)

admitting candidates to the examinations held under these byelaws and making all necessary arrangements for the conduct of examinations; 86

(ix)

refunding or transferring of fees received in accordance with these bye-laws for the examinations, enrolment, issue of certificates of practice and allied matters;

(x)

registering and noting of suspensions, cancellations and terminations of studentship;

(xi)

appointing solicitors or advocates and filling papers, swearing affidavits and subscribing to plaints, writs and other documents for court purpose;

(xii)

taking all steps necessary for proper conduct of elections; and

(xiii)

performing such other duties and functions as are incidental and ancillary to, and may be required for the performance of, the above duties and exercising such other power as may be delegated by the President, the Council or the Committees from time to time.

129A. *Power to issue directives.- The Council or any Standing Committee constituted under bye-law 72, may issue directives, from time to time, to the members and students on professional matters. 130.

Indemnity.- (1) The members of the Council, officers and auditors shall be indemnified by the Institute from all losses and expenses incurred by them in the discharge of their respective duties, except such as happen from their own respective willful default or in the case of an auditor from his own negligence or willful default or that of the partner or employee of such auditor. (2)

No member of the Council, officer or auditor shall be liable for default of any other member or members of the Council, officers or auditors, or for signing any receipt or document, or for any act of conformity, or for any loss or expense happening to the Institute, unless the same happens from his own willful default, or in the case of an auditor from his own negligence or willful default or that of any partner or employee of such auditor.

131. Constitution of students’ associations.- (1) The Council may constitute a students’ association in each Regional constituency as and when it deems fit and may frame rules laying down the conditions, functions and duties of such associations and such rules shall be notified in the official Gazette: ________________________________________________________________________ * SRO 22(KE)/2004 dated December 31, 2003 published in the Gazette of Pakistan (Extraordinary) – January 16, 2004.

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Provided that a students’ association constituted under the Chartered Accountants Bye-Laws, 1961, shall be construed to have been constituted under these byelaws. (2)

Any person who is admitted as a student shall become a member of the students’ association of his Region on payment of such fees, as may be prescribed, with his application for registration of his training contract.

(3)

The amount so collected shall be transferred to the respective students’ association and the Council may, in addition, give such financial grants to the students’ associations as may be decided by it from time to time.

(4)

No student shall become a member of, or associate himself, with, any other students’ association, by whatever name called, parallel to the one constituted under these bye-laws.

132.

Method of payment of fees.- All fees prescribed under these bye-laws, shall be paid to the Institute in such manner as the Council may direct.

133.

Publication of list of members.- (1) The Council shall publish the list of members required under sub-section (3) of section 18 in any manner it thinks fit and may distinguish between the associates and fellows in practice and between the associates and fellows not in practice. (2)

134.

Custody and use of Common Seal.- (1) The Common Seal shall be kept in such custody as the Council may from time to time determine. (2)

135.

Such publication shall be supplied to members and other gratuitously or at such price as the Council may from time to time determine.

The Common Seal shall not be affixed to any instrument except by order of the Council and every such instrument shall be signed by the President or two members of the Council and by the Secretary.

Other functions of chartered accountants in practice.- Without prejudice to the discretion vested in the Council in this behalf, a chartered accountant in practice may act as a liquidator, trustee, executor, administrator, arbitrator, receiver, advisor or a representative for costing, financial, company law and taxation matters or may take up an appointment that may be made by Federal Government or Provincial Government and Courts of law or any other Authority established under any law, or may act as Secretary in his professional capacity

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not being a whole-time salaried employee. 136.

Location of the office of the Institute.- The head-quarters of the Institute shall be located at Karachi or such other place as the Council may decide.

137.

Power to remove difficulties.- (1) if any difficulty arises in giving effect to the provisions of these bye-laws, the Council may, by general or special order, do anything not inconsistent with these provisions which appear to it to be necessary or expedient for the purpose of removing the difficulty. (2)

138.

In particular and without prejudice to the generality of the foregoing power, any such order, may provide for continuing in force such provisions of the Chartered Accountants Bye Laws, 1961, or such other provisions as conferred any right or privilege or as imposed any obligation or liability.

Repeal of Chartered Accountants Bye-laws, 1961.- (1) The Chartered Accountants Bye-Laws, 1961, are hereby repealed. (2)

Notwithstanding the repeal of the Chartered Accountants Bye-Laws, 1961, any appointment, notification, order, election, examination, result of an examinations, service as an articled or audit clerk, made, issued, held, declared, rendered or any other thing done under the repealed byelaws, shall, so far as it is not inconsistent with the provisions, of the byelaws, be deemed to have been made, issued, held, declared, rendered or done under the provisions of these bye-laws unless and until it is superseded by action taken in accordance with these bye-laws.

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