IBBI issues CPE guidelines for Insolvency Professionals. Minimum 60 hours in 3 calendar years prescribed

IBBI issues CPE guidelines for Insolvency Professionals. Minimum 10 hours each and 60 hours in three calendar years prescribed 

Insolvency and Bankruptcy Board of India

6th August, 2019

Insolvency  and  Bankruptcy  Board  of  India (Continuing  Professional Education for Insolvency Professionals) Guidelines, 2019

1. Short title and commencement

(a) These guidelines may be called the Insolvency and Bankruptcy Board of India (Continuing Professional Education for Insolvency Professionals) Guidelines, 2019.

(b) These Guidelines have been prepared in consultation with all the three Insolvency Professional Agencies (IPAs).

(c) These Guidelines shall come into force with effect from 1st January, 2020.

(d) These Guidelines are issued in exercise of the powers under Section 196(1)(aa) of the Insolvency and Bankruptcy Code, 2016 read with regulation 7(2)(ba) of the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016.

2. Background.

(a) Insolvency Professionals (IPs) constitute a key institution of the insolvency regime and market economy. An IP plays an important role in resolution, liquidation and bankruptcy processes of companies, LLPs, partnership firms, proprietorship firms and individuals in distress. His work affects the lives and livelihood of all stakeholders of the person in distress. He needs an array of abilities to deliver on his statutory duties and obligations in an ever-evolving market environment.

(b) Section 196(1)(aa) of the Insolvency and Bankruptcy Code, 2016 mandates the Insolvency and Bankruptcy Board of India (Board) to promote the development of, and regulate, the working and practices of, abcaus.in insolvency professionals, insolvency professional agencies and information utilities and other institut It has been endeavour of the Board to make available a cadre of competent and accountable IPs matching the dynamic market realities.

(c) Accordingly, regulation 7(2)(ba) of the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016 mandates that the registration of an IP is subject to the condition that he shall undergo continuing professional education (CPE) as may be required by the B Clause 10 under the First Schedule to the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016 provides that an IP must maintain and upgrade his professional knowledge and skills to render competent professional service.

3. Objective.

(a) Continuing professional education is a planned and systematic attempt to introduce, review, or alter the competencies and thereby improve the performance of professionals. It meets post-registration professional development needs of IP.

(b) An IP needs to continuously upgrade himself through CPE to remain relevant and provide value added services. He needs to attend today’s work with today’s technology. An anecdote from an unknown source illustrates the objective. There was a woodcutter who had been cutting wood for years. But he never got a raise. Others who joined later to him were getting raises every year even though some of them took rest in between, and some others took off for weeks. He met his boss with resentment. The boss replied: “You are cutting the same number of trees today you were cutting five years ago. How can we give a raise?” The woodcutter went back, worked harder, put in longer hours, but not much improvement. He consulted his colleagues and learnt that they took five minutes break each time after cutting a tree. Still they cut more trees. How? They use those five minutes to sharpen the axe. Some of them use tools sharper than axe. The woodcutter realised his folly that he had never sharpened his axe for years, nor tried to use sharper tools. He sharpened the axe and the productivity improved; he got a raise. He learnt to use mechanised tools and productivity improved further. He got further raise.

4. Application

(a) An IP shall undertake CPE in compliance with these Guidelines to keep his registration valid.

(b) Authorisation for assignment shall not be issued or renewed to an IP who fails to comply with these Guidelines.

(c) These Guidelines shall not apply to IPs who have completed the age of 65 years.

Illustration

An IP attains the age of 65 years on 24th November, 2026. He may not undertake CPE for the calendar year 2026.

5. CPE Requirement

(a) An IP shall undertake a minimum of 10 credit hours of CPE each calendar year and a minimum of 60 credit hours of CPE in each rolling block of three calendar years:

Provided that an IP is not required to undertake any CPE in the calendar year in which he is registered.

Illustration

An IP registered on 30th June, 2019 shall undertake CPE for at least-
(i) 10 credit hours in each calendar year, namely, 2020, 2021, 2022, 2023 and so on; and
(ii) 60 credit hours in each rolling block of three calendar years, namely, 2020-2022, 2021-2023, 2022-2024 and so on.

Clarification 1

An IP shall undertake CPE even when his registration is suspended, or he has ceased to have an authorisation for assignment.

Clarification 2

The minimum CPE of 10 hours may be exempted by the IPA for a year on application by the IP, provided that the IP undertakes a minimum of 60 hours in every rolling block of three years.

(b) An IP, whose registration is suspended or who ceased to have an authorisation for assignment, shall undertake the backlog of CPE hours before he seeks revival of registration or authorisation for assignment, as the case may be, if he has not undertaken CPE in accordance with (a) above.

Illustration

An IP ceased to have an authorisation for assignment on 15th January, 2020. He seeks authorisation for assignment on 16th November, 2027. He has not undertaken any CPE during 2020-2027. He shall undertake CPE for such hours as he would have done had he abcaus.in continued to have authorisation for assignment.

(c) Within seven days of completion of a learning activity, an IP shall submit such details of learning activity and credit hours earned by him, as may be required by his IPA.

(d) The IPA shall take note of the credit hours earned by an IP, on being satisfied that the IP has earned credit hours in accordance with the Guidelines.

6. Learning activities.

(a) An IP may earn credit hours from the learning activities in two ways:

(i) By participation in learning activities offered by the Board, an IPA, a Registered Valuer Organisation, a statutory professional institute, a university or any other entity, as may be approved by the Board from time to time; or

(ii)  By publishing articles / delivering lectures, in the areas relevant for IPs, an indicative list of which is at Schedule to these Guidelines.

(c) The following is an indicative format of learning activities in areas relevant for IPs and credit hours thereof:

7.  Monitoring

(a) The IPA shall monitor and maintain records of CPE in respect of its professional members in a manner accessible to IPs and the Board.

(b) The record of CPE shall include the details of learning activity undertaken by an IP, year wise and rolling block wise, including dates of each learning activity, the area of such activity, the credit hours earned for such activity, etc.

(c) The IPA shall submit an exception report every quarter to the Board and make available detailed records to the Board when called upon to do so.

(d) The Board shall make random check to verify the quality of learning activity and records of the IPAs in respect of CPE of their professional members.

8. Non-compliance

An IP, who fails to earn the credit hours in accordance with these Guidelines, shall be deemed to have contravened provisions of regulation 7(2)(ba) of the Insolvency and Bankruptcy Board of India (Insolvency Professionals) Regulations, 2016 read with clause 10 of the Code  of Conduct under the First Schedule thereof.

9. Review.

The Board may review these Guidelines from time to time, in consultation with the IPAs.

10. Abbreviations

Board: Insolvency and bankruptcy Board of India
CPE: Continuing Professional Education
IP: Insolvency Professional
IPAs: Insolvency Professional Agency

Schedule

Areas Relevant for Insolvency Professionals for the Purpose of Continuing Professional Education

Download IBBI (Continuing Professional Education for Insolvency Professionals) Guidelines, 2019 Click Here >>

• An invalid assessment order cannot be revised under section 263
• CIT can not assume revision powers u/s 263 for issues not forming part of limited scrutiny
• NFRA imposes penalty of Rs. 4.50 crores on CA/Audit Firm for professional misconduct
• SCN not giving minimum 7 days time to respond to proposed variation–Assessment set aside
• ITD Chandigarh invites empanelment of Cost Accountants u/s 142(2A) for FY 2024-2026