Examination for Insolvency professionals - Changes proposed
Published: Nov 06, 2017
By TIOLCORPLAW News Service
NEW DELHI, NOV 06, 2017: THE Insolvency and Bankruptcy Code, 2016 provides for a class of regulated persons, namely, Insolvency Professionals (IP), who play an important role in resolution, liquidation and bankruptcy processes of companies and individuals. Their responsibilities require the highest level of capability and integrity. Accordingly, the Code allows only individuals who have the required qualification and experience and are registered as IP with the Insolvency and Bankruptcy Board of India (Board) to render services as IP.
The Board has specified the requirements for registration as IP. The Board has been conducting Limited Insolvency Examination since 31st December, 2016. It is an online examination conducted every day from 100+ locations. The Board puts out syllabus, test definition, and a model question paper on its web site for guidance of prospective candidates and revises the same every six months, to assimilate the learning from transactions under the Code. By the end of October, 2017, 1799 Candidates have passed the examination and of them, 1181 have been registered as IPs. An IP needs in ample measure multi-dimensional skills, including leadership, inter-personal, communication, negotiation, conflict resolution, and stress management, in additional to professional knowledge and maturity. He may hire some of the knowledge and skills required for transactions under the Code and may delegate some of his non-core responsibilities, yet he needs to lead the initiative from front and drive value creation, while taking with him all the stakeholders with varied and conflicting interests. Though it includes case studies and case laws, the examination in the current format does not test these skills adequately. Keeping in view the job requirements of an IP, based on informal feedback from stakeholders and on the advice of the Examination Committee of the Board, it is proposed to change the Limited Insolvency Examination pattern to have two stages as under:
a. The examination in the current format will constitute Stage I;
b. Stage II will be a group discussion for four hours (two hours to read a case followed by two hours of discussion) on a case study to test a person's ability to handle stress and pressure, conflict management, balancing the interests of stakeholders, negotiation, leadership, communication, etc.
A candidate, who has cleared Stage I, would be allowed to attempt Stage II. A person, who has cleared both the Stages, will be considered to have passed the Limited Insolvency Examination. Stage II will be conducted once in a month or quarter, depending on the number of candidates eligible and interested to participate in the group discussion, in every metropolitan city. A candidate, who has cleared Stage-I, may make at most 2 attempts at Stage-II within one year of clearing Stage-I. The new pattern would be effective from 1st April, 2018.
The discussion paper solicits comments on need to supplement or strengthen the Limited Insolvency Examination and if so, how? The comments may be sent at exam@ibbi.gov.in by 31st December, 2017.
