Big Four, other global firms push back against draft ICAI rules
Top global professional services firms are pushing back against draft guidelines to regulate overseas networks engaged in multi-disciplinary advisory services in India, saying they require excessive disclosures that raise confidentiality concerns and add layers of operational complexity. They also said, ICAI’s proposed guidelines also use highly ambiguous terminology that creates uncertainty in interpreting the rules, setting the stage for a fresh standoff with the regulator.
ICAI had early this month released draft Guidelines for Overseas Network. The move was meant to create a level-playing field, but has ended up throwing up concerns that could hamper working of global accounting firms in India.
Currently, there are more than 170 global networks operating in India, including the Big Four.
One of their key concerns is the draft’s sweeping disclosure norms. For example, Form BO requires foreign networks to report all civil, criminal, and disciplinary cases against any partner or CA employee of Indian entities from the past five years. Firms say it adds no value and may force irrelevant disclosures beyond professional competence or network operations. Global professional services firms are also alarmed by the draft’s ambiguous disclosure norms, especially the requirement to report turnover on a “constituent-wise” basis, which could extend to all affiliated firms globally.
On the point of fees paid by Indian firms to global networks, these firms said it’s not a typical royalty but a fair payment for real services, like access to global audit methods, technology, and quality systems that help firms do better work. Insiders say fees could range from 4% to 7% of revenues, varying by firm.
The guidelines come as the Prime Minister's Office (PMO) pushes for the creation of India’s own ‘Big Four’, even as EY, Deloitte, PwC, and KPMG collectively crossed Rs. 45,000 crore in India revenue in FY25—with EY (June year-end) on the verge of becoming the first to reach $2 billion in gross revenues.
