Indian CFA

The Institute of Chartered Financial Analysts of India

The Institute of Chartered Financial Analysts of India was established in the year 1984 as a non-profit society registered under the A.P. (Telangana Area) Public Societies Act 1350F (Act 1 of 1350F) to offer the their flagship certification program for financial analysts known as CFA. The Institute was set up with the guidance from the leaders of the Indian Industry, CAs , PHDs,Bankers and academicians along with consultations from SEBI,Indian Ministry and other Indian bodies. The Association of Investment Management and Research(AIMR) the parent body of the present CFA Institute had a working relationship with ICFAI in the 1980s and was instrumental in setting up ICFAI. The CFA trademark was taken by AIMR and ICFAI jointly in India and later changed to 'in Use' by ICFAI after AIMR and ICFAI parted ways.

(ICFAI) represents India in the ASAF (Asian Security Analysts Federation, Australia). This is in no way affiliated to the CFA Institute of USA. The ICFAI's CFA course is designed for the Indian financial sector. This charter has the backing and recognition of EFFAS (European Federation of Financial Analyst Societies) and allows Indian ICFAI charter holders who have been conferred the CFA designation subject to membership in CCFA, to directly appear for the final CIIA exams from ACIIA. [http://www.icfai.org/icfe/aciia.htm]

Indian CFA Course Curriculum

The Program

This course is designed keeping in mind the Indian financial system and therefore offers more of a local flavor than the CFA Institute's program. ICFAI is a Private Institute and Indian CFAs need not be employed mandatorily by Indian companies. The ICAI (Institute of Chartered Accountants of India), ICWAI (Institute of Cost and Works Accountants of India) and ICSI (Institute of Company Secretaries of India) are all Apex bodies in their respective fields and are statutory bodies under an Act of the Parliament of India.The Indian CFA Program addresses the broader financial and managerial issues in the areas of Corporate Finance, International Finance, Investment Management and Financial Services.The CFA Program offered by ICFAI has been developed and is consistently reviewed in the context of the present and future needs of the corporate sector, the investment industry and the financial services sector in India.

CFA - Working Level Knowledge

Group A
*Financial Accounting - 100 points
*Economics - 100 points

Group B
*Quantitative Methods - 100 points
*Financial Management - 100 points

Group C
*Financial Markets - 100 points
*Financial Statement Analysis - 100 points

CFA - Expert Level Knowledge

Group D
*Equity: Analysis & Valuation - 100 points
*Fixed Income Securities: Analysis & Valuation - 100 points

Group E
*Derivatives: Analysis & Valuation - 100 points
*Portfolio Management - 100 points

Group F
*Mutual and other Funds - 100 points
*Professional Ethics and Case Studies - 100 points

Total 1200 points

The Examination for each subject is of 3 hours duration. Each group has two Papers of 3 hours each. Students who complete all the groups are entitled to receive the MFA Degree from ICFAI University, Tripura and the CFA Chater from the Institute at the same time.

Trademark Disputes CFAI vs ICFAI

History of the Dispute

The CFA program was an American program that was delivered internationally through various societies in 129 countries around the world through ICFA (representing member societies in America) and AIMR which were functioning separately.The ICFA and AIMR came together in 1990 to have a common uniform curriculum and bring all the societies under one umbrella.ICFAI had brought out its academic curriculum to suit Indian Finance Professionals, though it had global content. ICFAI wanted to function independently and had established working relationships with the European Federation of Financial Analysts(EFFAS) and the ASAF (Asian Securities Analysts Fedaration) with regard to development of the Profession of Security Analysts and its course content. ICFAI also wanted to bring its CFA as an Indian Statutory Charter. All this led to the dispute with AIMR, the parent body of CFA Institute which wanted a uniform curriculum or body of Knowledge through out the world for CFA program whereas ICFAI wanted changes in CFA charter to suit Indian regulations as finance professional used to work in an extremely regulated capital markets. AIMR eventually broke its working relationship with ICFAI and CCFA.

1. In August 2006, the Delhi high court issued a temporary injunction against the Indian organization from using the CFA in India. [http://www.cfainstitute.org/aboutus/press/release/06releases/20060817_01.html] The judgments made no assessment of the quality of the Indian program and merely discussed the trademark violation.The ICFAI appealed against this injunction and was successful in its appeal as it was issuing CFA charter from CCFA through the Institute and confers its Masters Degree in Finance from ICFAI in the capacity of a recognised UGC university.

2.On May 8, 2007, the U. S. District Court for the Eastern District of Virginia, vacated a Default Judgment issued against ICFAI that the CFA Institute (formerly AIMR) obtained in October, 1998. ICFAI recently moved to reopen the case and to vacate the Default Judgment because the Court lacked jurisdiction over ICFAI at the time the Default Judgment issued. Recognizing the merits of the ICFAI arguments, the Court vacated the October, 1998 Default Judgment.

3.With the Default Judgment vacated, ICFAI informed all its CFA charter holders that its earlier communication on not using the CFA charter in U. S. and Canada is treated as withdrawn.

4.However, on September 4, 2007, the US District Court for the Eastern District of Virginia reversed its decision to vacate the 1998 injunction against ICFAI after a motion to reconsider that decision was filed by the CFA institute. [http://www.cfainstitute.org/aboutus/worldwide/asiapac/indiaFAQ.html##usinjunction] [http://www.cfainstitute.org/aboutus/worldwide/asiapac/india/pdf/finalorder_4sept07.pdf]

5.The Indian TradeMark registry rejects CFA trademark rights of CFA Institute, America and recognises ICFAI's rights over the use of CFA charter in India which disputes the CFA Institute's claim of sole CFA trade mark rights owner worldwide. Similarly, CFA Institute had lost rights in United Kingdom, when UK registry stuck down CFA Institutes rights due to the association of Charter with Royal Charters.

6.The Delhi High Court rejected appeal of the CFA Institute to operate in India, the reason being CFA institute not having the approval from AICTE. The verdict was delivered on 15th December 2007 [http://www.business-standard.com/common/storypage_c.php?leftnm=10&autono=307616] .

On 27th May 2008, The Delhi High Court allowed US-based Chartered Financial Analyst Institute to conduct examination in India scheduled on June 8. This is an interim order on a petition by CFA Institute challenging the single bench order disallowing it from conducting examinations in India.

This year, around 4,000 Indian students are taking the examination outside the country compared to 7,000 last June. The judgement has come at a time when the students have already made arrangements of going abroad to take the examination.

While making it clear that further enrolment by the Institute will be done with the approval of this court, the bench comprising Chief Justice AP Shah and Justice S Muralidhar said: “Prima facie, the All India Council for Technical Education (AICTE) Act is not applicable (to CFA Institute).”

Last year AICTE, India’s apex body in technical education concluded that CFA Institute has not obtained its approval to conduct the CFA Program in India and must cease all operations in India. The CFA examination, that has three levels (1, 2 and 3) is held once a year in June for the Level 2 and Level 3 and twice a year (June and December) for Level 1.

Future of ICFAI and CFA

ICFAI having been embroiled in a long legal battle with CFA Institute has focussed its energies in developing Private Universities some of which have AICTE recognition along with UGC recognitions. ICFAI has focussed all its energies away from developing its CFA charter like giving it statutory recognition increasing its status as a high status profession like that of CA from ICAI,which was announced by the governing member NJ Yeshasway who vowed to take up the CFA Charter a notch above the legendary CA exam considered to be the toughest in the realm of financeFact|date=June 2008, but instead has opened a host of non-CFA programs like MBA, ICFAI Business Schools (IBS), PG Programs which have scaled up into national top 10 place in India. It has also opened schools for under graduate programs and offering degrees. CFAs pass with a stringent eligibility to qualify as CFAs but have only a niche finance sector as the job market unlike CA which has traditional roles of Auditing and taxation along with statutory roles.

Many of 5000 plus CFAs work in investment related and finance fields where MBAs (some from ICFAI itself), CAs, Masters Degree holders of Statistics, Economics, Doctorates etc. hold top posts.

ICFAI though has safeguarded its CFA charter in India with valid state legislature under IUT Tripura Act, but CFA charterholders are not mandatorily employable and currently don't perform any statutory duty unlike CAs, CSs, CWAs, though CCFA is trying hard to accomplish this in investment related areas in India. CFAs are employed only because of their course contents and rigor of the CFA programFact|date=June 2008, which is the only reason they have got market acceptance with very few qualifying as CFAs every year. ICFAI has very few CFA charter holders, compared to other professionals and hence they don't have a large and established presence in the Indian job market. Indian companies have tied up with other Indian bodies like AMFI or NSE in offering investment designations and courses.

ponsoring Institutes

CCFA (Council of Chartered Financial Analyst) is a registered society with the Indian government seeking to regulate the profession of financial analysts in India but is not a statutory body like ICAI or ICSI or ICWAI. The CFA charter is only a certification from ICFAI apprising the public at large of the CFAs competence for Financial and Investment analysis.

The Institute of Chartered Financial Analysts of India, a non-profit society, is the sponsor of the ICFAI University offering the CFA Charter along with MFA degree, which leads to the CFA Charter from CCFA.

Recent Developments

Relaxed criteria for Award of CFA Charter through MS Finance

In the recent meeting of the Board of GovernЂors of the Council of Chartered Financial Analysts (CCFA), the eligibility criteria for membership in the CCFA and for award of the CFA Designation and Charter were modified.

“Students who have successfully completed the Groups Alpha, Beta, Gamma, and the subjects Security Analysis, and Portfolio Management and Mutual Funds of the MS (Finance) Program are eligible for Membership in the CCFA and award of the CFA Charter and Designation.”

Subsequently, subjects in MS (Finance) program were realigned

With a view to improve the delivery of knowledge and to integrate different elements of finance domain in a cohesive manner, the subjects in Group Delta, Epsilon, and Kappa of MS (Finance) program were realigned, "Thus one can become CFA through MS (Finance) only after completing 1600 marks or 16 Papers as against 1200 marks from MFA-IUT."

Group Alpha
*Financial Accaounting - 200 marks
*Micro and Macro Economics - 200 marks Group Beta

*Quantitative Methods and Statistical Analysis - 200 marks
*Financial Management - 200 marks

Group Gamma

*Management Accounting - 200 marks
*Economic Legislation - 200 marks

Group Delta

*Security Analysis - 200 marks
*Portfolio Management and Mutual Funds - 200 marks

The revised format will become applicable in the examinations to be conducted from July 2007 onwards.

Thus one can now become CFA by passing groups Alpha, Beta, Gamma and Delta of MS (Finance) Program totaling 1600 marks, but will get their MS (Finance) only after completing another 1600 marks of exams or get an MFA Degree after completing 1200 marks from CFA program from ICFAI University of Tripura.

The CFA Bill 2007

CCFA working with the Ministry of Finance, has submitted a draft bill to the Government of India, "The CFA Bill, 2007" for the establishment of a Statutory Council of CFAs and for the merger of the CCFA Society with the Statutory Council. [http://www.indianexpress.com/story/217933.html]

The CFA Program with the Master in Financial Analysis Degree

Recently ICFAI through ICFAI University, Tripura, as mandated by Law, is offering the CFA Program leading to MFA Degree. This Charter is offered with a legal status.

Subsequently, The ICFAI University, Tripura sued CFA Institute regarding the right to use the CFA Charter, in the Guwahati High Court. The American CFA Institute is subsequently been barred from operating in India with no legal status to the American CFA Charter holders by Supreme Court Judgement.

The CFA program of ICFAI is now being offered by two independent bodies created separately i.e. CCFA and IUT Tripura and CFA's from both the bodies are obliged to become members of CCFA -The Indian Council of CFA's.

The Delhi High Court injunction barring ICFAI and CCFA from using their names is still in place as a result degrees are being offered from ICFAI University as separate entities, consequently the Web Sites of ICFAI and CCFA are nonoperational keeping in view of the Injunction order from October 2006, ICFAI has been given time up to seven years which is its academic period by the high court.

CFA Institute has approached the AICTE for a grant of accreditation.

upreme Court allows CAs to pursue CFA from ICFAI & become CFA's

After nearly two decades, the ICFAI (Institute of Chartered Financial Analysts of India) has won the ‘chartered’ row against the ICAI (Institute of Chartered Accountants of India).

In a decision dated May 16, 2007, the apex court ruled in favour of the Hyderabad-based ICFAI, by setting aside an earlier verdict of the Andhra Pradesh High Court, which had allowed the ICAI to prohibit its members from using the description ‘Chartered Financial Analyst’ or its abbreviation, CFA can now become full members in CCFA and practice as Chartered Financial Analysts.

AICTE takes action against CFA Institute, USA

All India Council for Technical Education (AICTE) has issued a letter to CFA Institute concluding that it has not obtained approval to conduct its CFA Program in India and must cease all operations in India.

Recognition of ICFAI by DEC (Distance Education Council)

Recently, ICFAI has been granted approval by Distance Education Council, under the aegis of IGNOU (Indra Gandhi National Open University)

External links

* [http://www.icfai.org Institute of Chartered Financial Analysts of India]
* [http://www.ccfaindia.org The Indian Council of CFA's]


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