CA coaching is brisk business

Around 700 students come to a prominent auditorium in the city every day. Many of them cannot find vacant seats, so they sit on the floor.

Around 700 students come to a prominent auditorium in the city every day. Many of them cannot find vacant seats, so they sit on the floor. Along with their notebooks, some also carry dictaphones.

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The gates of the fully packed auditorium close at 7 every morning. Soon, a booming voice is heard on stage, a huge projector screen is lit and a man in his early 30s starts addressing the students.

This is the scene at a typical private coaching class in New Delhi for students pursuing the chartered accountancy (CA) course.

Sumit, who attends CA classes at Pyarelal Auditorium near the ITO crossing in central Delhi, says: "The syllabus is too extensive and there is not much time available for CA students to study all the subjects in detail. So almost everyone has to go for private coaching classes. It helps a lot as the institutes provide us printed notes, in addition to regular lectures."

These classes are held in auditoriums and big halls having the capacity to accommodate at least 500 students. The private coaching classes for medical and engineering entrance examinations in comparison have around 50 to 100 students in one class.

There is such a mad rush of students for CA coaching classes that many auditoriums here are booked for four to eight months every year. Projectors, laptops and audio-visual presentations are used extensively to teach theoretical as well as practical lessons.

The revenue potential of CA coaching institutes is huge.

"If we can afford to hire auditoriums at the rate of Rs.10,000-15,000 per day continuously for eight to nine months every year, that itself is an indication of the turnover," said the owner of a CA coaching institute in west Delhi.

His institute has enrolled 1,000 students, charging Rs.5,000 to Rs.7,500 from each student for a four-month course this year.

A substantial part of this income is not taxed because students pay fees generally in cash and do not bother about a receipt.

KM Gupta, CEO of the Academy of Commerce, a Delhi-based leading private coaching institutes for CA students, says: "The revenue potential of CA courses is huge as coaching charges for each of the two dozen papers varies between Rs.2,500 and Rs.4,000. This includes the cost of printed notes and test papers.

"Delhi has emerged as the hub of CA coaching institutes over the last few years. Mumbai and Chennai are the other two centres where students from the western and southern parts of the country prefer to go."

In New Delhi, there are more than 100 CA coaching institutes, all of them doing brisk business.

"Thousands of students from other states are landing up in Delhi every year to attend these classes," according to Gupta, whose institute also provides hostel and paying guest facilities for such students.

The burgeoning CA coaching industry has propelled many qualified and experienced chartered accountants to chuck their lucrative practice or jobs to teach full time in institutes.

RK Mehta, who had acquired a CA degree around 10 years ago, says: "I teach five to six hours daily and I am able to make a satisfactory amount of money. I don't need to do anything else."

Most experienced faculty members teaching in top prestigious CA coaching institutes are able to make Rs 2-3 million per annum by spending around six to eight hours in the classroom every day, said a senior faculty member in a well known CA coaching institute here.

These numbers are likely to grow in the near future with a growing demand for CAs and a continuous increase in the number of students getting registered with the "Institute of Chartered Accountants of India (ICAI)", which conducts examinations and award CA degrees in India.

In 1995-96, the number of students registered with ICAI stood at 56,978. In 2004-05 this figure reached 84,251, an increase of around 50 per cent.