Breach of Trust and Damage to Reputation of CA Firm: ICAI reprimands CA who admits Guilt for Professional Misconduct [Read Order]

The Institute of Chartered Accountants of India (ICAI) has issued a formal reprimand against a chartered accountant after finding him guilty of professional misconduct under the Chartered Accountants Act, 1949. The order was passed by the Board of Discipline on July 29, 2025, following hearings that examined multiple allegations of misconduct.

The disciplinary proceedings were initiated based on a complaint involving breaches of trust and damage to professional reputation within a chartered accountancy firm. The case revealed that the member had undertaken professional assignments outside the knowledge of his firm, diverting payments into his personal account. Such conduct was found to be in violation of the terms of the partnership agreement and contrary to the ethical obligations of a chartered accountant.

Further, it was established that the member had made false and misleading communications to clients of the firm, casting unwarranted aspersions on expense claims. These actions, the Board noted, had the effect of undermining the firm’s goodwill and professional standing.

Additionally, the member had recorded and circulated a private telephonic conversation without consent, a move that was deemed unprofessional and damaging to workplace trust.

Other allegations, such as the alleged mishandling of forensic audit documents and financial discrepancies in partner accounts, were investigated but not upheld by the Director (Discipline). The Board concurred with this assessment, restricting its findings to three proven charges.

During the hearings, which concluded in January 2025, the respondent explicitly admitted guilt to the charges for which prima facie evidence existed. In light of this admission, the Board determined that no further inquiry was necessary and upheld the findings of misconduct under Clause (2) of Part IV of the First Schedule to the Chartered Accountants Act.

While noting the gravity of the violations, the Board opted for a reprimand instead of harsher measures such as suspension or removal from membership. Professional misconduct, even when not criminal in nature, attracts scrutiny and disciplinary measures intended to uphold public confidence in the accounting profession.

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