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The Company Secretary
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The Company Secretary Document Transcript

  • 1. THE COMPANY SECRETARY <br />–<br /> A COST CENTRE OR A BUSINESS ASSET<br />The Company Secretary, CS as it is abbreviated, is a profession that has been seeing a phenomenal growth since the last decade. A company secretary is a financially rewarding profession and a full-fledged course that is being sought by many students in the present day. The company secretary looks after the compliance needs of the company and ensures good corporate governance. But there has always been a doubt among many a fresher and prospective students about the viability of the course and whether it will give a good return on their investment. Many companies, indeed today, they might be just recruiting company secretaries just for the sake of compliance of Section 383A of the Companies Act, making the worrying natural.<br />Many a decision has been going on in various communities and discussion forums. Some questions being:<br />
    • If a Chartered Accountant can do just what a Company Secretary does, why do we need to do an additional course? Surely, CA is a more respected profession?
    • 2. CS’s are being paid the same meager salary that is being offered to MBA’s. Then why do CS? Why not just do an MBA?
    • 3. I have seen on many websites and job dailies, that companies prefer MBA Finance to a Chartered Accountant. So is MBA better? I understand this question does not belong here, but when I do give an answer to this question, you as a reader will understand its relevance.
    • 4. Will CS by itself guarantee a job? Do I need to any additional courses so that I can get that pay package that is being boasted of by many?
    These are the questions that are going to be answered in the article, after which I will proceed to the importance of a CS to the business and the industry, thereby making it clear to those who are in doubt that CS is indeed a wonderful journey to embark upon.<br />Let us go through the questions one by one.<br />Q: If a Chartered Accountant can do just what a Company Secretary does, why do we need to do an additional course? Surely, CA is a more respected profession?<br />A: Ah! This has been one of the favorite questions. Now, CA as a profession has been around for six decades. CS is a budding profession but has seen tremendous growth in the past two decades. It is only after the economic reforms of 1991 that the profession of a company secretary has gained prominence. Since 1991, the profession is reporting an amazing growth rate. CA has had so many decades for it to grow and the Institute has done much for the profession. Moreover, the authorities have granted it enough power that ICAI seems now like monster to its poor cousins – read ICWA, ICSI. For many years, chartered accountants have been practicing what seems to be the territory of the company secretaries and the cost accountants. CA is a respected profession, but so is CS and ICWA, if not more prominent. The courses are relatively similar although the difficulty levels may vary a bit. But all this does not mean that company secretaries are feeling the pang. Opportunities for company secretaries have been growing and ever since the Satyam episode, the need for this profession has taken a gigantic leap. The course with its new syllabus is very extensive and covers nearly everything that CA studies, except in the fact that CS is more about law and governance, CA is more about finance and taxation. There is a variation of depth at which the topics are studied. One thing I am sure, a CA does what he does best, and CS does what he does best. There can be no comparison because both are as different as an apple and an orange. Which is better? I would rate both of them equally. Corporate governance is the need of the day and company secretaries are the means to provide. So, do not be paranoid, the course and the profession is the in thing and soon becoming a fad. Now let me get to the real answer, readers here might have seen the job dailies etc, and they must have come across a requirement that a company needs a CA+CS. Some people might have never come across a recruitment hoard saying that they just require a CS. The answer to this dilemma is that most companies regard a CS as a cost centre. They just recruit for the sake of compliance, but most of those most companies ask for a CA+CS qualification because they want a person who is not just into secretarial work but can also work in areas regarding finance and taxation. Now, these companies are usually small companies who do not want to make expenditure on separate CS and CA. Some people complain that after doing a CS, they are doing only e-filing and stuff, but we must know that it is up to us, students and members, to bring up this profession, give excellent suggestions to our Institute, to set a standard. This is what we, as company secretaries, are lacking in general. CS is as good a course as CA. It is we that have to improve and get our Institute to do more to uplift this beautiful course.<br />Q: CS’s are being paid the same meager salary that is being offered to MBA’s. Then why do CS? Why not just do an MBA?<br />A: Salary is an issue that is being brought up by many a prospective student. Obviously, it is important to do a feasibility study before you choose a course that suits your aptitude. Everything must be taken into account, especially like areas of finance. Let us compare these two courses first, to understand better why these two are completely different.<br />MBACSMBA can have different specializations like finance, international business, systems, marketing, human resources, etc.CS deals entirely with finance and law which in turn have subfields like capital markets, arbitration and litigation, incorporation and liquidation, taxation etc..An MBA Finance student only studies concepts from over the surface.A CS studies the subject in a depth that cannot be matched by an MBAWhen company is in distress, an MBA is not the one to solve the dilemma.A CS has the expertise to do so.MBA does not have access to top management unless after several years of experience.A CS starts his work from the board room.Nearly 65-70% of MBA’s are still roaming the markets and selling insurance plans, for which the qualification is a 12th pass.Nearly 95-99% of CS’s are already working in companies, government institutions or practicing.<br />There can be many other differences of course but I have put down only those that seemed to me worthwhile. Why is an MBA becoming a FAD? Well, firstly, the salary figures. But we must sit up and take notice that MBA is better done through reputed institutions for which the fees are really very high, although you get the expected returns. But, the fact is that to pay for the course, you take a loan and you might expect to return that in maybe say 3years after you get a job. A company secretary course on the other hand costs just including Rs. 1, 50,000 or less (includes classes, books, tuition fees, examination fees). So even if you take a loan, you can return that in say 8 months. A CS is a different course than an MBA. It is also completely worthwhile. The next thing is why CS is paid less. It is not so. At least, a CS is paid more than a CA during training. CS has a starting salary of Rs. 35000 to Rs. 70000 p.m. Recently, I saw an advertisement that a company was offering 5.5 lakh per annum for a CS. So it is not essentially true that a CS is not paid well. It all depends on the negotiation skills and interpersonal skills. An MBA is full time course, which makes it a good opportunity to develop interpersonal skills.<br />Q: I have seen on many websites and job dailies, that companies prefer MBA Finance to a Chartered Accountant. So is MBA better?<br />A: The answer to this question lies in the above answer. We, CA and CS, in general, are technical. We must improve on our soft skills. This would make us more ideal choice for recruitment.<br />Q: Will CS by itself guarantee a job? Do I need to any additional courses so that I can get that pay package that is being boasted of by many?<br />A: Yes, a CS by itself will get you a job. Any additional courses will be a value addition and totally up to a student. But it is advisable to do a course, most do an LLB or a CA. Some do MBA. If you cannot do either of these, do a BCom, MCom, law diplomas (best if you do it from prestigious law schools like NLSIU Bangalore). There is also a course that I would like you to bear in mind. It is a very extensive course called MBL (Master in Business Laws). Subjects are more or less similar to the CS course.<br />Having answered some of the typical questions, I must end this article on a note that a company secretary is very essential to the organization structure. It is a course worth its salt. Thereby, do not make comparisons to any other course. Everything is not about money either; it is about knowledge, experience, profession and career. CS is one of the best courses I have ever come across where we study matters pertaining to law, finance, taxation, governance and capital markets. It is up to us entirely to make us seem like a cost centre or a business asset. I think all of us would like to be considered as Business Assets. How would we do that? By being dynamic and diversifying. Also, by behaving like a Company Secretary.<br />All I say to prospective students is that you are doing a Spot Trade by studying this course (Expected Time: 3 Years), You are doing a Futures Contract by choosing this profession, You are making yourself a Commodity that is likely to be Leveraged by a Corporate Entity and if you inculcate good soft skills, you will likely be a Call Option.<br />