The Institute of Chartered Accountants of India (ICAI) has announced that its Council has decided to initiate disciplinary scrutiny in cases where chartered accountants or firms quote extremely low fees for tenders that are disproportionate to the scope and nature of the work.
The announcement, issued by the Professional Development Committee on July 2, 2026, states that where the fee quoted by a member or firm is found to be “extremely low and is not commensurate with the size, value, volume, manpower requirement and nature of work,” the matter may be referred to the Director (Discipline) for appropriate action.
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Decision Applies Across All Tenders
According to the announcement, the Council’s decision is broad in scope and is not confined to assignments that are exclusively reserved for chartered accountants under law. Instead, it applies irrespective of whether the tender pertains to services exclusively reserved for CAs or otherwise.
The ICAI clarified that:
“The Council of ICAI has decided that wherever the fee quoted by the member or the firm is extremely low and is not commensurate with the size, value, volume, manpower requirement and nature of work, the matter can be referred to Director (Discipline) for appropriate action.”
The announcement further states that this principle will apply regardless of the category of tender involved.
Objective Behind the Decision
The move is intended to discourage unhealthy price competition that may compromise audit quality, professional ethics, and the ability of firms to perform assignments in accordance with applicable standards.
By empowering the disciplinary mechanism to examine such cases, the Council seeks to ensure that fee quotations reflect the actual resources, expertise, and professional responsibilities required for the assignment.
Impact on Chartered Accountants and Firms
The decision is expected to have significant implications for chartered accountants and CA firms participating in government, public sector, and private tenders. Members may now need to ensure that their financial bids are adequately justified and proportionate to the scope of work, failing which they could face disciplinary scrutiny.
Professional observers believe the announcement signals the ICAI’s intent to promote quality-driven competition rather than a race to secure assignments solely through aggressive fee undercutting.
The announcement was issued by the Professional Development Committee of ICAI on July 2, 2026, following a decision of the ICAI Council regarding tender participation by its members.
