Schedule
Syllabus
Schedule

CA-Inter Group 1

Starting 1 Feb 2019.
Orientation Classes starting 28 Jan 2019.

Days Timing Subject Faculty
MWF 8:00-11:00am TAX CS Saurabh Jain
MWF 11:30-2:30pm Accounts CA Sonu Gupta
TTS 8:00-11:00am Cost Management Accounting CA MS Rawat
TTS 11:30-2:30pm LAW CS Sujeet Jha
Sunday 4 Hours GST CA Mayank Bajaj
Sunday 2 Hours GMAP (GM Assessment Program) All Subjects
Syllabus

PAPER 1 – ACCOUNTING
PAPER – 2: CORPORATE AND OTHER LAWS
PAPER – 3: COST AND MANAGEMENT ACCOUNTING
PAPER – 3: COST AND MANAGEMENT ACCOUNTING
PAPER – 4 : TAXATION
PAPER 5: ADVANCED ACCOUNTING
PAPER 6: AUDITING AND ASSURANCE
PAPER – 7 : ENTERPRISE INFORMATION SYSTEMS AND STRATEGIC MANAGEMENT.
PAPER – 8 : FINANCIAL MANAGEMENT AND ECONOMICS FOR FINANCE
PAPER 1 – ACCOUNTING

PAPER 1 – ACCOUNTING
(One paper – Three hours – 100 Marks)

Objectives:

To acquire the ability to apply specific accounting standards and legislations to different transactions and events and in preparation and presentation of financial statements of various business entities.

Contents:

  1. Process of formulation of Accounting Standards including Ind ASs (IFRS converged standards) and IFRSs; convergence vs adoption; objective and concepts of carve
  2. Framework for Preparation and Presentation of FinancialStatements (as per AccountingStandards).
  3. Applications of AccountingStandards:

AS1 :     Disclosureof Accounting Policies AS2  :        Valuation ofInventories

AS3  :     Cash FlowStatements

AS4  :     Contingencies and Events occurring after the Balance SheetDate

AS 5  :     NetProfitorLossforthePeriod,PriorPeriodItemsandChangesinAccounting Policies

AS10:     Property, Plant andEquipment

AS11:     The Effects of Changes in Foreign Exchange Rates AS12:   Accounting for GovernmentGrants

AS13:     Accounting for Investments AS16:      BorrowingCosts

AS17:      SegmentReporting

AS22:     Accounting for Taxes onIncome

4.      CompanyAccounts
  • Redemptionof preferenceshares;
  • Redemptionofdebentures;
  • Accountingfor bonus issue and right
  • Accountingfor tax: Concept of deferred tax asset and deferred tax liability in line with AS 22 “Accounting forTaxes”.
  • ManagerialRemuneration
  • Preparationof financial statements – Statement of Profit and Loss, Balance Sheet and Cash FlowStatement,
  • Profit (Loss) prior toincorporation;
5.      Accounting for SpecialTransactions:
  • Investment
  • Insuranceclaims for loss of stock and loss ofprofit
  • Hire- purchase and Instalment SaleTransactions
6.      Special Type ofAccounting
  • DepartmentalAccounting
  • Accountingfor Branches including foreignbranches
  • Accountsfrom IncompleteRecords
7.      Dissolutionof partnership firms including piecemeal distribution of assets; Amalgamation of partnership firms; Conversion of partnership firm into acompany and Sale to a company; Issues related to accounting in Limited LiabilityPartnership.

Note :  If either anew Accounting Standards (AS), Announcements and Limited Revisions to   AS are issued or the earlier one are withdrawn or new AS, Announcements and Limited Revisionsto AS are issued in place of existingAS, Announcements and Limited Revisions to  AS, the syllabus will accordingly include / exclude such new developments in the place ofthe existingoneswitheffectfromthedatetobenotifiedbytheInstitute.

PAPER – 2: CORPORATE AND OTHER LAWS

PAPER – 2: CORPORATE AND OTHER LAWS

(One paper – Three hours - 100Marks)

PART I – COMPANY LAW (60MARKS)

Objective:

To develop an understanding of the provisions of company law and acquire the ability to address application-oriented issues.

Contents:

The Companies Act, 2013 – Sections 1 to 148

  1. Preliminary
  2. Incorporationof Company and Matters Incidentalthereto
  3. Prospectusand Allotment ofSecurities
  4. Share Capital andDebentures
  5. Acceptanceof Deposits bycompanies
  6. RegistrationofCharges
  7. ManagementandAdministration
  8. Declarationand payment ofDividend
  9. AccountsofCompanies
  10. AuditandAuditors

Note: The provisions of the Companies Act, 1956 which are still  in force would form  part ofthe syllabus till the time their corresponding or new provisions of the Companies Act, 2013 areenforced.

 

PART II- OTHER LAWS (40 MARKS)

Objectives:

  • To develop an understanding ofthe provisions of select legislations and acquire the ability to address application-oriented
  • Todevelopanunderstandingoftherulesforinterpretationofstatutes
  1. The Indian Contract Act, 1872 (Specificcontracts covered from section 123 onwards): Contract of Indemnity and Guarantee, Bailment, Pledge,Agency
  2. The Negotiable Instruments Act, 1881: Meaning of Negotiable Instruments, Characteristics, Classification of Instruments, Different provisions relating to Negotiation, Negotiability, Assignability, Right and Obligationof parties, presentment of Instruments, Rules ofCompensation
  3. The General Clauses Act, 1897: Important Definitions, Extent and Applicability, General Rules of Construction, Powers and Functionaries, Provisions as to Orders, Rules, etc. made under Enactments,Miscellaneous
  4. Interpretation ofstatutes: Rules of Interpretationof statutes, Aids to interpretation, Rules of Interpretation/construction of Deeds andDocuments

Note: If new legislations are enacted in place of the existing legislations, the syllabus wouldinclude the corresponding provisions of such new legislations with effect from a date notified by the Institute. Similarly, if any existing legislation ceases to have effect,  the syllabus will accordingly exclude such legislation with effect from the date to be notifiedby theInstitute.

The specific inclusions/exclusions in the various topics covered in the syllabus will be effected every year by way of Study Guidelines, if required.

PAPER – 3: COST AND MANAGEMENT ACCOUNTING

PAPER – 3: COST AND MANAGEMENT ACCOUNTING

(One Paper- Three hours- 100 Marks) 

Objectives:

  • To develop an understanding ofthe basic concepts and applications to establish the cost associated with the production of products and provision of services and apply the  same todetermine
  • To develop an understanding ofcost accounting
  • To acquire the ability to apply cost information for cost ascertainment, planning, controland decision
Contents:
  1. Overview of Cost and Management Accounting
    • Introduction to Cost and Management Accounting
      1. Objectives and Scope of Cost and Management Accounting,
      2. The users of Cost and Management accounting information- Functions of management
      3. Roleof cost accounting departmentin an organisation and its relation with other
      4. Installation of Costing System
      5. Relationship of       Cost            Accounting,                 Financial        Accounting,     Management Accounting and Financial Cost terms and Concepts
      6. Cost Reduction and CostControl
  1. ElementsofCosts
  2. Cost behavior pattern, Separating the components of fixed, variable, semi- variable and step
  3. Methodsof Costing, Techniques of
  4. Cost Accounting with use of Information
(ii)   Elementsof Cost and preparation of Cost Sheets
  1. Functional classification and ascertainment of cost
  2. Preparation of Cost Sheets for Manufacturing sector and for Service sector
  3.  Ascertainment of Cost and Cost Accounting System
  • MaterialCost
    1. Procurement procedures- Store procedures and documentation in respect of receipts and issue of stock, Stock verification,
    2. Valuation of material receipts,
    3. Inventory control-
      • Techniques of fixing level of stocks- minimum, maximum, re-order point, safety stock, determination of optimum stock level,
      • Determination of Optimum Order quantity- Economic Order Quantity (EOQ),
      • Techniques of Inventory control- ABC Analysis, Fast, Slow moving and Nonmoving (FSN), High, Medium, Low (HML), Vital, Essential, Desirable (VED), Just-in-Time (JIT)- Stock taking and perpetual inventory system, use of control ratios,
    4. Inventory Accounting
    5. Consumption- Identification with products of cost centres, Basis for consumption entries in financial accounting, monitoring
(ii)   EmployeeCost
  1. Attendance and Payroll procedures-
    • Elements of wages- Basic pay, Dearness Allowance, Overtime, Bonus, Holiday and leave wages, Allowances and
  2. Employee Cost Control
  3. Employee Turnover- Methods of calculating employee turnover, causes of employee turnover, effects of employee
  4. Utilisationof Human Resource, Direct and indirect employee Cost, charging of employee cost, Identifying employee hours with work orders or batches or capital
  5. Remuneration systems and incentiveschemes-
    • TimeRate System, Piece Rate System, Differential piece rate system, Calculation of wages, Effective
(iii)  DirectExpenses
  1. Direct expenses
  2. Natureof Direct or Chargeable
  3. Sub-contracting-Control on material movements, Identificationwith the main product or
(iv)  Overheads
  1. Functional analysis- Factory, Administration, Selling, Distribution, Research and
  2. Behavioral analysis- Fixed, Variable and Semi-
  3. Allocation and Apportionment of overheads using Absorption Costing
  4. Factory Overheads- Primary and secondarydistribution,
  5. Administration Overheads- Method of allocation to cost centresor products,
  6. Selling& Distribution Overheads- Analysis and absorption of the expenses inproducts/ customers, impact of marketing strategies, cost effectiveness of various methods of sales
  7. Treatmentof Research and development cost in cost
(v)   Conceptsof Activity Based Costing(ABC)
  • Recording and Accounting ofCosts
    1. Non-integratedCost Accounting system- Ledger under non-integralsystem
    2. Integrated (Cost and Financial) Accounting system- Ledgers under integral
    3. Difference between the Non- integrated and IntegratedAccounting
    4. Reconciliationof profit as per Cost and Financial Accounts (under Non- Integrated AccountingSystem).
3.      Methods of Costing
  • Single Output/ UnitCosting
  • Job Costing: Job cost cards and databases, collecting direct costs of each job, attributing overheads to jobs, Applicationof job
  • Batch Costing: Determination of optimum batch quantity, Ascertainment of  cost for a batch, Preparation of batch cost sheet, Treatment of spoiled and defective
(iv)   ContractCosting
  1. Ascertainment of cost of a contract, Progress payment, Retention money, Escalation clause, Cost plus contract, Value of work certified, Cost of Work not certified.
  2. DeterminationValue of work certified, Cost of work not certified, Notional or Estimated profit from a
(v)   Process/OperationCosting
  1. Processcost recording, Process loss, Abnormal gains and losses, Equivalent unitsofproduction,Inter-processprofit,Valuationofworkin
  2. Joint Products- Apportionment of joint costs, Methods of apportioning joint cost over joint products,
  3. By-Products-Methods of apportioning joint costs over by-products, treatment of By-product
(vi)   Costing of ServiceSectors
  1. Determination of Costs and Prices of services of following sectors/Industries:
    • Transport, Toll roads, Hospitals, Canteen/ Restaurants, Hotels/ Lodges, Educational Institutions, Financial Institutions/ Banks, Insurance, IT sector and other
4.      Cost Control andAnalysis
  • StandardCosting
    1. Settingup of Standards, Types of Standards, Standard Costing as method of performance
    2. Calculationand Reconciliation of CostVariances-
      • MaterialCost Variance, employee Cost Variance, Variable Overheads Variance and Fixed Overhead
(ii)   MarginalCosting
  1. Basic concepts of marginal costing, Contribution margin, Break-even analysis, Break –even and profit volume charts, Contribution to sales ratio, Margin of Safety, Angle of Incidence,Cost-Volume-Profit Analysis (CVP), Multi- product break- even analysis, Consideration of Limiting factor (key factor),
  2. Determination of Cost of a product/ service under marginal costing method, determination of cost of finished goods, work-in-progress,
  3. Comparison of Marginal costing with absorption costing method- Reconciliation of profit under the both methods,
  4. Short term decision making using the above concepts (basic / fundamental level).
(iii)  Budget and BudgetaryControl
  1. Meaningof Budget, Essentialsof Budget, Budget Manual, Budget setting process, Preparation of Budget and monitoring
  2. Theuse of budget in planning andcontrol
  3. Flexible budget, Preparation of Functional budget for operating and non- operating functions, Cash budget, Master budget,
  4. Introductionto Principal/ Keybudget factor, Zero Based Budgeting (ZBB), Performance budget, Control ratios and Budget
PAPER – 3: COST AND MANAGEMENT ACCOUNTING

PAPER – 3: COST AND MANAGEMENT ACCOUNTING

(One Paper- Three hours- 100 Marks) 

Objectives:

  • To develop an understanding ofthe basic concepts and applications to establish the cost associated with the production of products and provision of services and apply the  same todetermine
  • To develop an understanding ofcost accounting
  • To acquire the ability to apply cost information for cost ascertainment, planning, controland decision
Contents:
  1. Overview of Cost and Management Accounting
    • Introduction to Cost and Management Accounting
      1. Objectives and Scope of Cost and Management Accounting,
      2. The users of Cost and Management accounting information- Functions of management
      3. Roleof cost accounting departmentin an organisation and its relation with other
      4. Installation of Costing System
      5. Relationship of       Cost            Accounting,                 Financial        Accounting,     Management Accounting and Financial Cost terms and Concepts
      6. Cost Reduction and CostControl
  1. ElementsofCosts
  2. Cost behavior pattern, Separating the components of fixed, variable, semi- variable and step
  3. Methodsof Costing, Techniques of
  4. Cost Accounting with use of Information
(ii)   Elementsof Cost and preparation of Cost Sheets
  1. Functional classification and ascertainment of cost
  2. Preparation of Cost Sheets for Manufacturing sector and for Service sector
  3.  Ascertainment of Cost and Cost Accounting System
  • MaterialCost
    1. Procurement procedures- Store procedures and documentation in respect of receipts and issue of stock, Stock verification,
    2. Valuation of material receipts,
    3. Inventory control-
      • Techniques of fixing level of stocks- minimum, maximum, re-order point, safety stock, determination of optimum stock level,
      • Determination of Optimum Order quantity- Economic Order Quantity (EOQ),
      • Techniques of Inventory control- ABC Analysis, Fast, Slow moving and Nonmoving (FSN), High, Medium, Low (HML), Vital, Essential, Desirable (VED), Just-in-Time (JIT)- Stock taking and perpetual inventory system, use of control ratios,
    4. Inventory Accounting
    5. Consumption- Identification with products of cost centres, Basis for consumption entries in financial accounting, monitoring
(ii)   EmployeeCost
  1. Attendance and Payroll procedures-
    • Elements of wages- Basic pay, Dearness Allowance, Overtime, Bonus, Holiday and leave wages, Allowances and
  2. Employee Cost Control
  3. Employee Turnover- Methods of calculating employee turnover, causes of employee turnover, effects of employee
  4. Utilisationof Human Resource, Direct and indirect employee Cost, charging of employee cost, Identifying employee hours with work orders or batches or capital
  5. Remuneration systems and incentiveschemes-
    • TimeRate System, Piece Rate System, Differential piece rate system, Calculation of wages, Effective
(iii)  DirectExpenses
  1. Direct expenses
  2. Natureof Direct or Chargeable
  3. Sub-contracting-Control on material movements, Identificationwith the main product or
(iv)  Overheads
  1. Functional analysis- Factory, Administration, Selling, Distribution, Research and
  2. Behavioral analysis- Fixed, Variable and Semi-
  3. Allocation and Apportionment of overheads using Absorption Costing
  4. Factory Overheads- Primary and secondarydistribution,
  5. Administration Overheads- Method of allocation to cost centresor products,
  6. Selling& Distribution Overheads- Analysis and absorption of the expenses inproducts/ customers, impact of marketing strategies, cost effectiveness of various methods of sales
  7. Treatmentof Research and development cost in cost
(v)   Conceptsof Activity Based Costing(ABC)
  • Recording and Accounting ofCosts
    1. Non-integratedCost Accounting system- Ledger under non-integralsystem
    2. Integrated (Cost and Financial) Accounting system- Ledgers under integral
    3. Difference between the Non- integrated and IntegratedAccounting
    4. Reconciliationof profit as per Cost and Financial Accounts (under Non- Integrated AccountingSystem).
3.      Methods of Costing
  • Single Output/ UnitCosting
  • Job Costing: Job cost cards and databases, collecting direct costs of each job, attributing overheads to jobs, Applicationof job
  • Batch Costing: Determination of optimum batch quantity, Ascertainment of  cost for a batch, Preparation of batch cost sheet, Treatment of spoiled and defective
(iv)   ContractCosting
  1. Ascertainment of cost of a contract, Progress payment, Retention money, Escalation clause, Cost plus contract, Value of work certified, Cost of Work not certified.
  2. DeterminationValue of work certified, Cost of work not certified, Notional or Estimated profit from a
(v)   Process/OperationCosting
  1. Processcost recording, Process loss, Abnormal gains and losses, Equivalent unitsofproduction,Inter-processprofit,Valuationofworkin
  2. Joint Products- Apportionment of joint costs, Methods of apportioning joint cost over joint products,
  3. By-Products-Methods of apportioning joint costs over by-products, treatment of By-product
(vi)   Costing of ServiceSectors
  1. Determination of Costs and Prices of services of following sectors/Industries:
    • Transport, Toll roads, Hospitals, Canteen/ Restaurants, Hotels/ Lodges, Educational Institutions, Financial Institutions/ Banks, Insurance, IT sector and other
4.      Cost Control andAnalysis
  • StandardCosting
    1. Settingup of Standards, Types of Standards, Standard Costing as method of performance
    2. Calculationand Reconciliation of CostVariances-
      • MaterialCost Variance, employee Cost Variance, Variable Overheads Variance and Fixed Overhead
(ii)   MarginalCosting
  1. Basic concepts of marginal costing, Contribution margin, Break-even analysis, Break –even and profit volume charts, Contribution to sales ratio, Margin of Safety, Angle of Incidence,Cost-Volume-Profit Analysis (CVP), Multi- product break- even analysis, Consideration of Limiting factor (key factor),
  2. Determination of Cost of a product/ service under marginal costing method, determination of cost of finished goods, work-in-progress,
  3. Comparison of Marginal costing with absorption costing method- Reconciliation of profit under the both methods,
  4. Short term decision making using the above concepts (basic / fundamental level).
(iii)  Budget and BudgetaryControl
  1. Meaningof Budget, Essentialsof Budget, Budget Manual, Budget setting process, Preparation of Budget and monitoring
  2. Theuse of budget in planning andcontrol
  3. Flexible budget, Preparation of Functional budget for operating and non- operating functions, Cash budget, Master budget,
  4. Introductionto Principal/ Keybudget factor, Zero Based Budgeting (ZBB), Performance budget, Control ratios and Budget
PAPER – 4 : TAXATION

PAPER – 4 : TAXATION

(One paper ─ Three hours – 100 Marks)

 

To develop an understanding of the provisions of income-tax law and goods and services tax  law and to acquire the ability to apply such knowledge to make computations and address  application oriented issues.

SECTION A: INCOME TAX LAW (60 MARKS)

Contents:

  1. BasicConcepts
    • Income-tax law: An introduction
    • Important definitions in the Income-tax Act,1961
    • Conceptof previous year andassessmentyear
    • Basisof Charge and Rates ofTax
2.      Residential status and scope of totalincome
  • Residential status
  • Scope of total income
3.      Incomes which do not form part of total income (other than charitable trusts and institutions, political parties and electoral trusts)
  • Incomes not included in total income
  • Tax holiday for newly established units in Special Economic Zones
4.      Headsof income and the provisions governing computation of income under differentheads
  • Salaries
  • Income from house property
  • Profits and gains of business or profession
  • Capital gains
  • Income from other sources
5.      Incomeof other persons included in assessee's totalincome
  • Clubbing of income: An introduction
  • Transfer of income without transfer of assets
  • Income arising from revocable transfer of assets
  • Clubbing of income of income arising to spouse, minor child and son’s wife in certain cases
  • Conversion of self-acquired property into property of HUF
6.      Aggregation of income; Set-off, or carry forward and set-off of losses
  • Aggregation of income
  • Concept of set-off and carry forward and set-off of losses
  • Provisions governing set-off and carry forward and set-off of losses under different heads of income
  • Order of set-off of losses
7.      Deductions from gross totalincome
  • General provisions
  • Deductions in respect of certain payments
  • Specific deductions in respect of certain income
  • Deductions in respect of other income
  • Other deductions
8.      Computationof total income and tax liability ofindividuals
  • Income to be considered while computing total income ofindividuals
  • Procedure for computation of total income and tax liability of individuals
9.      Advance tax, tax deduction at source and introduction to tax collection at source
  • Introduction
  • Direct Payment
  • Provisions concerning deduction of tax at source
  • Advance payment oftax
  • Interest for defaults in payment of advance tax and deferment of advance tax
  • Tax collection at source – Basic concept
  • Tax deduction and collection accountnumber
10.    Provisions for filing return of income andself-assessment
  • Return of Income
  • Compulsory filing of return ofincome
  • Fee and Interest for default in furnishing return ofincome
  • Return of loss
  • Provisions relating to belated return, revised return
  • Permanent account number
  • Persons authorized to verify returnofincome
  • Self-assessment
SECTION B – INDIRECT TAXES (40 MARKS)

Contents:

  1. Concept of indirect taxes
    • Concept and features of indirect taxes
    • Principal indirect taxes
2.       Goods and Services Tax (GST)Laws
  • GST Laws: An introduction including Constitutional aspects
  • Levy and collection of CGST andIGST
    1. Application of CGST/IGST law
    2. Concept of supply including composite and mixedsupplies
    3. Charge of tax
    4. Exemption from tax
    5. Composition levy

(iv)   Basic concepts of time and value ofsupply

  • Input tax credit
  • Computation of GST liability
  • Registration
  • Tax invoice; Credit and Debit Notes; Electronic waybill
  • Returns
  • Payment of tax including reverse charge

Note– If any new legislation(s) is enacted in place of an existing legislation(s), the syllabus will accordingly include the corresponding provisions of such new legislation(s) in place of the existing legislation(s) with effect from the date to be notified by the Institute. Similarly, if any existing legislation ceases to have effect, the syllabus will accordingly exclude such legislation with effect from the date to be notified by the Institute. Students shall not be examined with reference to any particular State GST Law.

Consequential/corresponding amendments made in the provisions of the Income-tax law and Goods and Services Tax laws covered in the syllabus of this paper which arise out of the amendments made in the provisions not covered in the syllabus will not form part of the syllabus. Further, the specific inclusions/exclusions in the various topics covered in the syllabus will be effected every year by way of Study Guidelines. The specific inclusions/exclusions may also arise due to additions/deletions every year by the annual Finance Act.

PAPER 5: ADVANCED ACCOUNTING

GROUP II-  PAPER 5: ADVANCED ACCOUNTING

(One paper – Three hours – 100 Marks)
  1. To acquire the ability to apply specific AccountingStandards, Guidance Notes and legislations to different transactions and events and in preparation and presentation of financial statementsof businessentities;
  2. To understand and apply financial reporting and regulatory requirements of Banking, Financial services and Insurance
Contents:
  1. AccountingStandards:

AS7:       Construction Contracts

AS9:        Revenue Recognition

AS14:      Accounting for Amalgamations

AS18:      Related Party Disclosures

AS19:      Leases

AS20:     Earnings PerShare

AS24:     Discontinuing Operations

AS26:     Intangible Assets

AS29:     Provisions, Contingent Liabilities and Contingent Assets.

2.      Applicationof Guidance Notes issued by the ICAI on specified accounting aspects. CompanyAccounts
  1. Special Aspects ofCompanyAccounts
    • Accounting for employee stock option plan
    • Buy back of securities
    • Equity shares with differential rights
    • Underwriting of shares and debentures
4.      Reorganisation of Companies
  • Accounting for Amalgamation (excluding inter-company holding) and reconstruction
  • Accounting involved in liquidation of companies
5.      Financial Reporting of Banking, Financial Services and Insurance (BFSI)
  • Insurance companies,
  • Banking companies and
  • Non-Banking Financial Companies
  • Mutual funds and regulatory requirements thereof.
6.      Valuation of goodwill
  1. Consolidated Financial Statements

Concept of consolidation and simple problems on Consolidated Financial Statements with single subsidiary (excluding problems involving acquisition of Interest in Subsidiary at Different Dates; Different Reporting Dates; Disposal of a Subsidiary and Foreign Subsidiaries)

Notes :
  1. If either a new Accounting Standards (ASs), Announcements and Limited Revisions to ASs are issued or the earlier one are withdrawn or new ASs, Announcements and Limited Revisions to AS are issued in place of existing ASs, Announcements and Limited Revisions to AS, the syllabus will accordingly include / exclude such new developments in the place of the existing ones with effect from the date to be
  2. The specific inclusions/exclusions,in any topic covered inthe syllabus,will be effected every year by way of Study The list of applicable Guidance Notes in Accounting will also form part of the StudyGuidelines.
PAPER 6: AUDITING AND ASSURANCE

PAPER 6: AUDITING AND ASSURANCE (100 MARKS)

(One paper – Three hours – 100 Marks)

Objective:

To develop an understanding of the concepts in auditing and of the generally accepted auditing procedures, techniques and skills and acquire the ability to apply the same in audit and attestation engagements.

1.      Nature, Objective and Scope ofAudit

Auditing Concepts: Nature, objective and scope of Audit; Relationship of auditing with other disciplines;

Standard Setting Process: Overview, Standard-setting process, Role of International Auditing and Assurance Standards Board (IAASB) & Auditing and Assurance Standards Board (AASB); Standards on Auditing, Guidance Note(s) issued by the ICAI;

Engagement Standards: Qualities of Auditor, Elements of System of Quality Control (SQC

1 Quality Control for Firms that Perform Audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements); Ethical requirements relating to an audit of financial statements ; Inherent Limitations of an audit (SA 200 Overall Objectives of the Independent Auditor and the Conduct of an Audit in Accordance with Standards on Auditing); Preconditions for an audit; Audit Engagement; Agreement on Audit Engagement Terms; Terms of Engagement in Recurring Audits (SA 210 Agreeing the Terms of Audit Engagements); Leadership Responsibilities for Quality on Audits; Concept of Auditor’s Independence; Threats to Independence; Acceptance and Continuance of Client Relationships and Audit Engagements (SA 220 Quality Control for an Audit of Financial Statements).

2.      Audit Strategy, Audit Planning and AuditProgramme

Audit Strategy; Audit planning (SA 300); Audit programme; Development of Audit Plan and Programme, Control of quality of audit work - Delegation and supervision of audit work; Materiality and Audit Plan; Revision of Materiality; Documenting the Materiality; Performance Materiality (SA 320 Materiality in Planning and Performing an Audit).

3.      Audit Documentation and Audit Evidence

Concept of Audit Documentation; Nature & Purpose of Audit Documentation; Form, Content &Extent of Audit Documentation; Completion Memorandum; Ownership and custody of Audit Documentation (SA 230 Audit Documentation); Audit procedures for obtaining audit evidence; Sources of evidence; Relevance and Reliability of audit evidence; Sufficient appropriate audit evidence, Evaluation of Audit Evidence (SA 500 Audit Evidence);Written Representations as Audit Evidence; Objective of Auditor regarding Written Representation; Management from whom Written Representations may be requested; Written Representations about Management’s Responsibilities (SA 580 Written Representations); Obtaining evidence of existence of inventory; Audit procedure to identify litigation & claims (SA 501 Audit Evidence - Specific Considerations for Selected Items); External confirmation procedures; Management's refusal to allow the auditor to send a confirmation request; Negative Confirmations (SA 505 External Confirmations); Audit evidence about opening balances; Accounting policies relating to opening balances; Reporting with regard to opening balances (SA 510 Initial Audit Engagements-Opening Balances); Meaning of Related Party; Nature of Related Party Relationships & Transactions; Understanding the Entity's Related Party Relationships & Transactions (SA 550 Related Parties); Meaning of Subsequent Events; Auditor's obligations in different situations of subsequent events(SA560Subsequent Events); Responsibilities of the Auditor with regard to Going ConcernAssumption;Objectives of the Auditor regarding Going Concern; Events or Conditions that may cast doubt about Going Concern Assumption; Audit Procedures when events or conditions are identified (SA 570 GoingConcern).

  1. Risk Assessment and Internal Control: Audit Risk, Identifying and Assessing the Risk of Material Misstatement, Risk Assessment procedures; Understanding the entity and its environment; Internal control ,Documenting the Risks; Evaluation of internal control system; Testing of Internal control; Internal Control and IT Environment (SA 315 Identifying and Assessing the Risks of Material Misstatement Through Understanding the Entity and Its Environment); Materiality and audit risk (SA 320 Materiality in Planning and Performing an Audit);Internal audit, Basics of Standards on Internal Audit (SIAs) issued by the ICAI; Basics of Internal Financial Control and reporting requirements; Distinction between Internal Financial Control and Internal Control over Financial
  2. Fraud and Responsibilities of the Auditor in this Regard: Responsibility for the Prevention and Detection of Fraud; Fraud Risk Factors; Risks of Material Misstatement Due to Fraud; Communication of Fraud (SA 240 The Auditor’s responsibilities Relating to Fraud in an Audit of Financial Statements); Provisions of the Companies Act 2013 relating to fraud and rules thereunder including reporting requirements under
  3. Audit in an Automated Environment: Key features, Impact of IT related Risks, Impact on Controls, Internal Financial Controls as per Regulatory requirements, Types of Controls, Audit approach, Understanding and documenting Automated environment, Testing methods, data analytics for audit, assessing and reporting audit
  4. Audit Sampling: Meaning of Audit Sampling; Designing an audit sample; Types of sampling; Sample Size and selection of items for testing; Sample selection method (SA 530 Audit Sampling).
  5. Analytical Procedure: Meaning, nature, purpose and timing of analytical procedures; Substantive analytical procedures, Designing and performing analytical procedures prior to Audit; investigating the results of analytical procedures (SA 520 AnalyticalProcedures).
  6. Audit of Items of Financial Statements: Audit of sale of Products and Services; Audit of Interest Income, Rental Income, Dividend Income, Net gain/loss on sale of Investments

Audit of Purchases, Employee benefits expenses, Depreciation, Interest expense, Expenditure on Power & Fuel, Rent, Repair to building, Repair to Machinery, Insurance, Taxes, Travelling Expenses, Miscellaneous Expenses etc.

Audit of Share Capital, Reserve & Surplus, Long Term Borrowings, Trade Payables, Provisions, Short Term Borrowings & Other Current Liabilities. Audit of Land,Buildings, Plant & Equipment, Furniture & Fixtures, Vehicles, Office Equipments, Goodwill, Brand/Trademarks, Computer Software etc. Audit of Loan & Advances, Trade Receivable, Inventories, Cash & Cash Equivalent, Other Current Assets. Audit of Contingent Liabilities.

(The list of items is illustrative only)

 

  1. TheCompanyAudit:Eligibility,QualificationsandDisqualificationsofAuditors;Appointment of auditors; Removal of auditors; Remuneration of Auditors; Powers and duties of auditors; Branch audit; Joint audit; Reporting requirements under the Companies Act, 2013 including CARO; Other Important Provisions under the Companies Act, 2013 relating to Audit and Auditors and Rules made
  2. Audit Report: Forming an opinion on the Financial Statements; Auditor's Report- basic elements (SA 700 Forming an Opinion and Reporting on Financial Statements); Types of Modified Opinion; Circumstances When a Modification to the Auditor’s Opinion is Required (SA 705 Modification to the Opinion in the Independent Auditor’s Report); Qualification, Disclaimer, Adverse opinion (SA 706 Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent, Auditor’s Report); Nature of Comparative Information; Corresponding Figure; Comparative Financial  Statements(SA710 ComparativeInformation Corresponding Figures and Comparative Financial Statements).
  1. Audit of Banks: Understanding of accounting system in Banks, Audit Approach, Audit of Revenue items,  Special Consideration in Bank Audit with emphasis on Advances and
  2. AuditofDifferentTypesofEntities:AppointmentofAuditor,AuditAuditReport in respect of different Category of Entities mentioned below: government; Local bodies and not-for-profit organizations; Partnership Firms, Audit of different type of undertakings, i.e., Educational institutions, Hotels, Clubs, Hospitals Basics of Limited Liability Partnerships (LLPs) audit and Co-operative SocietiesAudit.
Note:
  • Thespecificinclusions/exclusions,inanytopiccoveredinthesyllabus,willbeeffectedevery year by way of Study
  • The provisions of the Companies Act, 1956 which are still in force would form part of the syllabus till the time their corresponding or new provisions of the Companies Act, 2013 are enforced.
  • If new legislations/ Standards on Auditing/Guidance Notes/Statements are enacted in place of the existing legislations, the syllabus would include the corresponding provisions of such new legislations with effect from a date notified by the Institute. The changes in this regard would also form part of Study
PAPER – 7 : ENTERPRISE INFORMATION SYSTEMS AND STRATEGIC MANAGEMENT.

PAPER – 7 : ENTERPRISE INFORMATION SYSTEMS AND STRATEGIC MANAGEMENT.

(One paper – Three hours – 100 Marks)

SECTION A : ENTERPRISE INFORMATION SYSTEMS (50 MARKS)

Objective: To develop an understanding of technology enabled Information Systems and their impact on enterprise-wide processes, risks and controls.

Contents:

1.      AUTOMATED BUSINESS PROCESSES
  • Introductionto Enterprise BusinessProcesses, Benefits, Risks andControls;
  • Diagrammatic representation of business processes usingFlowcharts;
  • Risks and controls for specific business processes: Procure to pay (P2P), Order to cash, Inventory Cycle, Hireto Retire, Supply Chain Management,FixedAssets
  • Applicable regulatory and compliance requirements including computer related offences, privacy, cyber-crime, Sensitive Personal Data Information of Information Technology Act,2000
2.      FINANCIALAND ACCOUNTINGSYSTEMS
  • Integrated (ERP) and non-integrated systems with related risks andcontrols;
  • Business process modules and their integration with Financial and Accounting
  • Reporting Systems and MIS, Data Analytics and BusinessIntelligence
  • Business Reporting and fundamentals of XBRL (eXtensible Business ReportingLanguage).
  • Applicableregulatory and compliancerequirements
3.      INFORMATIONSYSTEMS AND ITSCOMPONENTS
  • Componentsof Automated Information Systems: Application Systems, Database, Network and OperatingSystem with related risks and
  • Mapping of Organization structure with segregation of duties in Information
4.      E-COMMERCE, M-COMMERCE AND EMERGINGTECHNOLOGIES
  • Components and Architecture of E-Commerce and M-Commerce with related risks andcontrols
  • Business process flow with its related risks andcontrols
  • Applicableregulatory and compliancerequirements
  • Emerging technologies with its related risks andcontrols
5.      CORE BANKINGSYSTEMS
  • Components and Architecture ofCBSand related risks and controls
  • Core modules of banking and Business process flow and its related risks andcontrols
  • Reporting Systems and MIS, Data Analytics and Business Intelligence
  • Applicable regulatory and compliance requirements
SECTION B : STRATEGIC MANAGEMENT (50 MARKS)

Objective: To develop an understanding ofstrategic management concepts  and techniquesand acquire the ability to apply the same in businesssituations.

Contents
  1. Introduction to StrategicManagement
    • BusinessPolicy
    • Meaning and Nature of Strategic management
    • Business Strategy
    • Strategic Levels in Organizations
    • Strategic Management in Government and Not-for-profit organization
2.      Dynamics of Competitive Strategy
  • Competitive Landscape
  • Strategic Analysis
  • Industry and Competitive Analysis
  • Core Competence
  • Competitive Advantage
  • Internal and External Analysis
  • SWOT Analysis
  • Globalization
3.      Strategic Management Process
  • Strategic Planning
  • Strategic Intent - Vision, Mission and Objectives
  • Strategy Formulation
4.      Corporate Level Strategies
  • Concepts and Nature of CorporateStrategy
  • Strategic Alternatives at CorporateLevel
    1. Growth
    2. Stability
    3. Expansion
    4. Business Combinations – Mergers and Acquisitions
    5. Strategic Alliances
    6. Turn around
    7. Retrenchment and Retreat
5.      Business LevelStrategies
  • Competitive Strategies at BusinessLevel
  • Michael Porter’s GenericStrategies
  • Best-Cost Provider Strategy
6.      FunctionalLevelStrategies
  • Marketing Strategy
  • Financial Strategy
  • Operations Strategy
  • Human Resource Strategy
  • Research and Development
7.      Organisationand StrategicLeadership
  • Organisation Structure
  • Strategic Business  Unit
  • Strategic Leadership
  • Strategy Supportive Culture
  • Entrepreneurship and Intrapreneurship
8.      Strategy Implementation and Control
  • Strategy Implementation
  • Strategic Change
  • Strategic Control
  • Strategy Audit
  • Business Process Reengineering
  • Benchmarking

 

PAPER – 8 : FINANCIAL MANAGEMENT AND ECONOMICS FOR FINANCE

PAPER – 8 : FINANCIAL MANAGEMENT AND ECONOMICS FOR FINANCE

(One paper – Three hours – 100 Marks)

SECTION A: FINANCIAL MANAGEMENT (60 MARKS)

Objective: To develop an understanding of various aspects of Financial Management and acquire the ability to apply such knowledge in decision-making.

1.      Financial Management and FinancialAnalysis
  • Introduction to Financial ManagementFunction
    1. Objectiveand scope of financialmanagement
    2. Role andpurpose
    3. Financialmanagementenvironment
    4. Functionsof finance executives in anorganization
    5. Financial distress and
(ii)   Financial Analysis through Ratios
  1. Usersof the financialanalysis
  2. Sourcesof financial dataforanalysis
  3. Calculationand Interpretation ofratios:
    • Analysing liquidity
    • Analysing leverage
    • Analysing solvency
    • Analysing efficiency/activity
    • Analysing profitability
  4. Limitations of ratio analysis
2.      FinancingDecisions
  • Sources ofFinance
    1. Different Sources of Finance, Characteristics of different types of long term debt and equity finance, Method of raising long term finance
  1. Different Sources of short termFinance
  2. Internal fund as a source offinance
  3. International sources offinance
  4. Other sources of finance- Sale and lease back, Convertible debt, Venture capital, Grants
(ii)   LeaseFinancing
  1. Concept andClassification
  2. Significance and Limitations of Lease Financing
  3. Financial Evaluation of Leasing Decision
(iii)   Cost of Capital
  1. Significance of cost of capital
  2. Factors of cost of capital
  3. Measurementof costs of individual components ofcapital
  4. Weighted average cost of capital(WACC)
  5. Marginal cost ofcapital
  6. EffectiveInterestrate
(iv)  Capital StructureDecisions
  1. Significance of capital structure
  2. Determinants of capital structure
  3. Capital structure planning and designing
  4. Designing of optimum capital structure
  5. Theories of Capital Structure and value of the firm- relevancy and Irrelevancy of capital
  6. EBIT-EPS Analysis, Breakeven- EBIT
  7. Under/Over
(v)   Leverages
  1. Typesof Leverages- Operating, Financial andCombined
  2. Analysisofleverages
3.      Capital Investment and DividendDecisions
  • Capital InvestmentDecisions
    1. Objectiveof capital investmentdecisions
    2. Methodsof Investmentappraisal:
  • Payback period, Discounted paybackperiod
  • AccountingRate of Return(ARR),
  • Net Present Value (NPV) - The meaning of NPV, Strengths and limitations of NPV method, The impact of taxation onthe NPV analysis, The impact of Inflation on the NPV analysis, The working capital adjustment in an NPV analysis,Capital rationing, Equivalent Annual Costs, Adjusted present value
  • Internal Rate of return (IRR)-Limitations of the IRR method, MultipleIRRs,
  • Modifiedinternal Rate of Return (MIRR)- Definition andexplanation of MIRR, The process for calculating MIRR, Strengths of the MIRR
  • ProfitabilityIndex
(ii)   Adjustmentof Risk and Uncertaintyin Capital BudgetingDecision
  1. ProbabilityAnalysis
  2. Certainty EquivalentMethod
  3. Risk Adjusted DiscountRate
  4. Monte CarloSimulation
  5. DecisionTreeAnalysis
  6. ScenarioAnalysis
  7. SensitivityAnalysis
(iii)  DividendDecisions
  1. BasicsofDividends
  2. Formsofdividend
  3. Determinantsofdividend
  4. Relevancy and Irrelevancy of Dividend Policies-Traditional Approach, Walter’s model, Gordon’s model, Modigliani and Miller (MM)
4.      Managementof WorkingCapital
  • Management of WorkingCapital
    1. Themanagement of working capital- Liquidity andProfitability
    2. The Working capital financing decisions- Primary and Secondary Sources of Liquidity
    3. The working Capital Cycle (operating Cycle), Effectiveness of Working Capital based on its operating and cash conversioncycles
    4. Assessmentof working capitalrequirement
    5. Managementof Accounts Receivables(Debtors)
    6. Factoring andForfaiting
    7. Managementof Accounts Payables(Creditors)
    8. ManagementofInventory
    9. Managementof Cash, Treasurymanagement
    10. Banking norms of working capital finance

SECTION B : ECONOMICS FOR FINANCE (MARKS: 40)

Objective:

To develop an understanding of the concepts and theories of Economics in the context of Finance and acquire the ability to address application oriented issues

1.      Determinationof NationalIncome
  • Macro Economic Aggregates and Measurement of NationalIncome
  • The Keynesian Theory of Determinationof NationalIncome
2.      The MoneyMarket
  • TheConceptofMoneyDemand:ImportantTheoriesofDemandforMoney
  • The Concept of MoneySupply
  • MonetaryPolicy
3.      PublicFinance
  • Fiscal functions: An
  • MarketFailure
  • Government Interventions to Correct MarketFailure
  • FiscalPolicy
4.      InternationalTrade
  • Theoriesof InternationalTrade
  • Trade Policy – The Instruments of TradePolicy
  • TradeNegotiations
  • ExchangeRates and its economiceffects
  • International Capital Movements: Foreign DirectInvestment