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CA Intermediate Syllabus

PAPER 1 – ACCOUNTING

(One paper – Three hours – 100 Marks)

Objective:

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 AS (IFRS converged standards) and IFRSs; convergence vs adoption; objective and concepts of carve outs.
  2. Framework for Preparation and Presentation of F inancial Statements (as per Accounting Standards).
  3. Applications of Accounting Standards:
 AS 1 : Disclosure of Accounting Policies
AS 2 : Valuation of Inventories
AS 3 : Cash Flow Statements
AS 10 : Property, Plant and Equipment
AS 11 : T he Effects of Changes in Foreign Exchange Rates
AS 12 : Accounting for Government Grants
AS 13 : Accounting for Investments
AS 16 : Borrowing Costs

 

  1. Company Accounts
    • Preparation of financial statements – Statement of Profit and Loss, Balance  Sheet  and Cash Flow Statement;
    • Managerial Remuneration;
    • Profit (Loss) prior to incorporation;
    • Accounting for bonus issue and right issue;
    • Redemption of preference shares;
    • Redemption of debentures.

     5. Accounting for Special Transactions:

    • Investment;
    • Insurance claims for loss of stock and loss of profit;
    • Hire- purchase and Instalment sale transactions.

      6. Special Type of Accounting

    • Departmental Accounting;
    • Accounting for Branches including foreign branches;
    • Accounts from Incomplete Records.

  Note : If either new Accounting Standards  (AS),  Announcements  and  Limited  Revisions to AS are issued or the       earlier ones are withdrawn  or  new  AS,  Announcements  and  Limited  Revisions to AS are issued  in  place  of           existing  AS, Announcements and Limited Revisions to AS, the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 notified by the Institute.

 

PAPER – 2: CORPORATE AND OTHER LAWS

(One paper  – Three hours – 100  Marks)

PART I – COMPANY LAW  (60 MARKS)

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. Incorporation of Company and Matters Incidental thereto
  3. Prospectus and Allotment of Securities
  4. Share Capital and Debentures
  5. Acceptance of Deposits by companies
  6. Registration of Charges
  7. Management and Administration
  8. Declaration and payment of Dividend
  9. Accounts of Companies
  10. Audit and Auditors

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

 

PART II- OTHER LAWS (40 MARKS)

Objectives:

  • T o develop an understanding of the provisions of select legislations  and  acquire  the  ability to address application-oriented
  • T o develop an understanding of the rules for interpretation of statutes
  1. The Indian Contract Act, 1872 (Specific contracts 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 Obligation of parties, presentment of  Instruments, Rules of Compensation
  3. The General Clauses Act, 1897: Important Definitions, Extent and Applicability, General Rules of Construction, Powers and Functionaries, Provisions as to  Orders,  Rules,  made under Enactments, Miscellaneous
  4. Interpretation of statutes: Rules of  Interpretation  of  statutes,  Aids  to  interpretation, Rules of Interpretation/construction of Deeds and Documents

Note: If new legislations 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.  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.

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

(One Paper- T hree hours- 100 Marks)

Objectives:

  • T o develop an understanding of the basic concepts and applications to establish the cost associated with the production of  products  and  provision  of services and apply the same to determine
  • T o develop an understanding of cost accounting
  • T o acquire the ability to apply information for cost ascertainment, planning, control and decision

Contents:

  1. Overview of Cost and Management Accounting
    • Introduction to Cost and Management Accounting
      • Objectives and Scope of Cost and Management Accounting,
      • T he users of Cost and Management accounting information, Functions of management
      • Role of cost accounting department in an organisation  and  its  relation  with other
      • Installation of Costing System
      • Relationship of Cost  Accounting, Financial Accounting, Management Accounting and Financial
      • Cost terms and Concepts
      • Cost Reduction and Cost Control
      • Elements of Costs
      • Cost behavior pattern, Separating the components of fixed, variable, semi – variable and step costs.
      • Methods of Costing, Techniques of Costing.
      • Cost Accounting with use of Information Technology.
    • Elements of Cost and preparation of Cost Sheets
      • Functional classification and ascertainment of cost
      • Preparation of Cost Sheets for Manufacturing sector and for Service sector

 

     2. Ascertainment of Cost and Cost Accounting System

  • Material Cost
    • Procurement procedures- Store procedures and documentation in respect of receipts and issue of stock, Stock verification,
    • Valuation of material receipts,
    • Inventory control-
      • T echniques 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),
      • T echniques of Inventory control- ABC Analysis, Fast,  Slow  moving  and Non moving (FSN), High, Medium, Low (HML), Vital, Essential, Desirable (VED), Just-in-T ime (JIT )- Stock taking and  perpetual  inventory  system, use of control ratios,
    • Inventory Accounting
  • Employee Cost
    • Attendance and Payroll procedures-
      • Elements of wages- Basic pay, Dearness Allowance, Overtime, Bonus, Holiday and leave wages, Allowances and
    • Employee Cost Control
    • Employee T urnover- Methods of calculating employee turnover, causes of employee turnover, effects of employee
    • Utilisation of Human Resource, Direct and indirect employee Cost, charging of employee cost, Identifying employee hours with work  orders  or  batches  or capital
    • Remuneration systems and incentive schemes- Premium  Bonus  Method  (Halsey Plan and Rowan Plan)
  • Overheads
    • Functional analysis- Factory, Administration,  Selling,  Distribution,  Research  and
    • Behavioral analysis- Fixed, Variable and Semi- Variable.
    • Allocation and Apportionment of overheads using Absorption Costing Method.
    • Factory Overheads- Primary and secondary distribution,
    • Administration Overheads- Method of allocation to cost centres or products,
    • Selling & Distribution Overheads- Analysis and absorption of the expenses in products/ customers, impact of marketing strategies, cost effectiveness  of various methods of sales
    • T reatment of Research and development cost in cost accounting.
  • Concepts of Activity Based Costing (ABC)
  •  Recording and Accounting of Costs
    • Non-integrated Cost Accounting system- Ledger under non-integral system.
    • Integrated (Cost and Financial) Accounting system – Ledgers under integral system.
    • Difference between the Non- integrated and Integrated Accounting system.
    • Reconciliation of profit as per Cost and Financial Accounts (under Non- Integrated Accounting System).

    3.  Methods of Costing

  • Single Output/ Unit Costing
  • Job Costing: Job cost cards and databases, collecting direct costs of each job, attributing overheads to jobs, Application of job costing.
  • Batch Costing: Determination of optimum  batch  quantity,  Ascertainment  of cost for a batch, Preparation of batch cost sheet, T reatment of spoiled and defective work.
  • Contract Costing: 
    • Ascertainment of cost of a contract, Progress payment, Retention money, Escalation clause, Cost plus contract, Value of work certified, Cost of Work not certified.
    • Determination Value of work certified, Cost of work not certified, Notional or Estimated profit from a contact.
  • Process/ Operation Costing
    • Process cost recording, Process loss, Abnormal gains and losses, Equivalent units of production, Inter-process profit, Valuation of work in
    • Joint Products- Apportionment of joint costs, Methods of apportioning joint cost over joint products,
    • By-Products- Methods of  apportioning  joint  costs  over  by-products,  treatment of By-product cost.
  • Costing of Service Sectors
    • Determination of Costs and Prices of services.

    4. Cost Control and Analysis

  • Standard Costing
    • Setting up of Standards, T ypes of Standards, Standard Costing as method of performance measurement.
    • Calculation and Reconciliation of Cost Variances-
      • Material Cost Variance, employee Cost Variance, Variable Overheads Variance and Fixed Overhead variance.
  • Marginal Costing
    • 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),
    • Determination of Cost of a product/ service under marginal costing method, determination of cost of finished goods, work-in-progress,
    • Comparison of Marginal costing with  absorption costing method- Reconciliation of profit under the both methods,
    • Short term decision making using the above concepts (basic /  fundamental level).
  • Budget and Budgetary Control
    • Meaning of Budget, Essentials of Budget, Budget Manual, Budget setting process, Preparation of Budget and monitoring procedures.
    • T he use of budget in planning and control
    • Flexible budget, Preparation of Functional budget for operating and non – operating functions, Cash budget, Master budget,
    • Introduction to Principal/ Key budget factor, Zero Based Budgeting (ZBB), Performance budget, Control ratios and Budget variances.

PAPER – 4 : TAXATION

(One paper ─ Three hours – 100 Marks)

Objective:

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. Basic Concepts
    • Income-tax law: An introduction
    • Important definitions in the Income-tax Act, 1961
    • Concept of previous year and assessment year
    • Basis of Charge and Rates of T ax

      2. Residential status and scope of total income

    • 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
    • T ax holiday for newly established units in Special Economic Zones

     4. Heads of income and the provisions governing computation of income under different heads

    • Salaries
    • Income from house property
    • Profits and gains of business or profession
    • Capital gains
    • Income from other sources

      5. Income of other persons included in assessee’s total income

    • Clubbing of income: An introduction
    • T ransfer 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 total income

    • General provisions
    • Deductions in respect of certain payments
    • Specific deductions in respect of certain income
    • Deductions in respect of other income
    • Other deductions

     8. Computation of total income and tax liability of individuals

    • Income to be considered while computing total income of individuals
    • 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 of tax
    • Interest for defaults in payment of advance tax and deferment of advance tax
    • Tax collection at source – Basic concept
    • Tax deduction and collection account number

    10. Provisions for filing return of income and self-assessment

    • Return of Income
    • Compulsory filing of return of income
    • Fee and Interest for default in furnishing return of income
    • Return of loss
    • Provisions relating to belated return, revised return
    • Permanent account number
    • Persons authorized to verify return of income
    • 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 and IGST
      1. Application of CGST /IGST law
      2. Concept of supply including composite and mixed supplies
      3. Charge of tax including reverse charge
      4. Exemption from tax
      5. Composition levy
    • Basic concepts of time and value of supply
    • Input tax credit
    • Computation of GST liability
    • Registration
    • T ax invoice; Credit and Debit Notes; Electronic waybill
    • Returns
    • Payment of tax

Note – If any new legislation(s)  is  enacted  in  place  of an  existing  legislation(s), the  syllabus will accordingly include the corresponding provisions of suc h 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 T ax 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.  T he  specific inclusions/exclusions may also arise due to additions/deletions  every  year  by  the  annual Finance Act.

 

GROUP II- PAPER 5: ADVANCED ACCOUNTING

(One paper – Three hours – 100 Marks)

 

Objectives:

  1. T o acquire the ability to apply specific Accounting Standards and legislations to different transactions and events and in preparation and presentation of financial statements of business entities;
  2. T o understand and apply financial reporting and regulatory requirements of Banking Companies and NBFCs.

Contents:

  1. Application of Accounting Standards:
AS 4 : Contingencies and Events Occurring After the Sheet Date Balance
AS 5 : Net Profit or Loss for the Period, Prior Period Changes in Accounting Policies Items and
AS 7 : Construction Contracts
AS 9 : Revenue Recognition
AS 14 : Accounting for Amalgamations
AS 17 : Segment Reporting
AS 18 : Related Party Disclosures
AS 19 : Leases
AS 20 : Earnings Per Share
AS 22: Accounting for Taxes on Income
AS 24 : Discontinuing Operations
AS 26 : Intangible Assets
AS 29 : Provisions, Contingent Liabilities and Contingent Assets.
  1. Special Aspects of Company Accounts
    • Accounting for employee stock option plan;
    • Buy back of securities;
    • Equity shares with differential rights.

     3. Reorganization and liquidation of Companies

    • Accounting for amalgamation (excluding  inter-company holding) and reconstruction;
    • Accounting involved in liquidation of companies.

     4 Banking Companies and Non-Banking Financial Companies and regulatory requirements                       thereof.

  1. Consolidated Financial Statements

Concept of consolidation and simple problems on  Consolidated  Financial  Statements with single subsidiary               (excluding problems involving ac quisition of Interest in Subsidiary at Different Dates; Different Reporting                    Dates of Holding and Subsidiary; Disposal of a Subsidiary and F oreign Subsidiaries).

     6. Dissolution of partnership firms including piecemeal distribution of assets; Amalgamation of             partnership firms; Conversion of partnership firm into a company and Sale to a company;                     Issues related to accounting in Limited Liability Partnership.

Notes :

  1. If either new Accounting Standards  (ASs),  Announcements  and  Limited  Revisions  to ASs are issued or the earlier ones 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 notified.
  2. T he specific exclusions, in any topic covered in the syllabus, will  be effected, if any, by way of Study

 

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 of Audit

      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 T erms; T erms of Engagement in Recurring Audits (SA 210 Agreeing the T erms of Audit                            Engagements); Leadership Responsibilities for Quality on Audits; Concept of Auditor’s Independence; T hreats            to Independence; Acceptance and Continuance of Client Relationships and Audit Engagements (SA 220                        QualityControl for an Audit of Financial Statements).

 2. Audit Strategy, Audit Planning and Audit Programme

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 Materialityin 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 Evidenc e (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 & T             ransactions; Understanding the Entity’s Related Party Relationships & T ransactions (SA 550 Related Parties);            Meaning of Subsequent Events; Auditor’s obligations in different situations of subsequent events (SA 560                      Subsequent Events); Responsibilities of the Auditor with regard to Going Concern Assumption; 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 Going Concern).

4.  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; T esting of Internal control; Internal Control and         IT Environment (SA 315 Identifying and Assessing the Risks of Material Misstatement T hrough 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

5.   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 T he 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

6.    Audit in an Automated Environment: Key features, Impact of IT related Risks, Impact on Controls,                      Internal Financial Controls as per Regulatory requirements, T ypes of Controls, Audit approach, Understanding          and documenting Automated environment, T esting methods, data analytics for audit, assessing and reporting             audit

7.    Audit Sampling: Meaning of Audit Sampling; Designing an audit sample; T ypes of sampling; Sample Size                and selection of items for testing; Sample selection method (SA 530 Audit Sampling).

8.   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 Analytical Procedures).

9.   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 etc.

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

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

       (The list of items is illustrative only)

10.  The Company Audit: Eligibility, Qualifications and Disqualifications of Auditors; Appointment of auditors;            Removal of auditors; Remuneration of Auditors; Powers and duties of auditors; Branch audit; Joint audit;                    Reporting requirements under the Com panies Act, 2013 including CARO; Other Important Provisions under              the Companies Act, 2013 relating to Audit and Auditors and Rules made

11.  Audit Report: Forming an opinion on the Financial Statements; Auditor’s Report- basic elements (SA 700                 Forming an Opinion and Reporting on Financial Statements); T ypes 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 (SA 710 Comparative Information – Corresponding Figures and                  Comparative Financial Statements).

12. 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 NPAs.

13. Audit of Different Types of Entities: Appointment of Auditor, Audit Audit Report 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 LiabilityPartnerships (LLPs) audit and Co-operative Societies Audit.

Note:

  • T he specific inclusions/exclusions, in any topic covered in the syllabus, will be effected every year by way of Study Guidelines.
  • T he 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 suc h new legislations with effect from a date notified by the T he changes in this regard would also form part of Study Guidelines.

 

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

  • Introduction to Enterprise Business Processes, Benefits, Risks and Controls;
  • Diagrammatic representation of business processes using Flowcharts;
  • Risks and controls for specific business processes: Procure to pay (P2P), Order to cash, Inventory Cycle, Hire to Retire, Supply Chain Management, Fixed Assets etc.
  • Applicable regulatory and compliance requirements including computer related offences, privacy,  cyber-crime,  Sensitive   Personal  Data  Information  of  Information T echnologyAct, 2000

 2. FINANCIAL AND ACCOUNTING SYSTEMS

  • Integrated (ERP) and non-integrated systems with related risks and controls;
  • Business process modules and their integration with Financial and Accounting systems.
  • Reporting Systems and MIS, Data Analytics and Business Intelligence
  • Business Reporting and fundamentals of XBRL (eXtensible Business Reporting Language).
  • Applicable regulatory and compliance requirements

 3.  INFORMATION SYSTEMS AND ITS COMPONENTS

  • Components of Automated Information Systems: Application Systems, Database, Network and Operating System with related risks and controls.
  • Mapping of Organization structure with  segregation  of  duties  in  Information systems.

 4. E-COMMERCE, M-COMMERCE AND EMERGING TECHNOLOGIES

  • Components and Architecture of E-Commerce and M-Commerce with related risks and controls
  • Business process flow with its related risks and controls
  • Applicable regulatory and compliance requirements
  • Emerging technologies with its related risks and controls

  5.  CORE BANKING SYSTEMS

  • Components and Architecture of CBS and related risks and controls
  • Core modules of banking and Business process flow and its related risks  and  controls
  • Reporting Systems and MIS, Data Analytics and Business Intelligence
  • Applicable regulatory and compliance requirements

 

SECTION B : STRATEGIC MANAGEMENT (50 MARKS)

Objectives

To develop an understanding of strategic management concepts and techniques and ac quire the ability to apply           the same in business situations.

Contents

  1. Introduction to Strategic Management
    • Business Policy
    • 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 Corporate Strategy
    • Strategic Alternatives at Corporate Level
      • Stability
      • Growth/Expansion
      • Business Combinations – Merger and Acquisition
      • Strategic Alliances
      • Retrenchment/Turnaround
      • Combination

        5. Business Level Strategies

    • Competitive Strategies at Business Level
    • Michael Porter’s Generic Strategies
    • Best-Cost Provider Strategy

         6. Functional  Level Strategies

    • Marketing Strategy
    • Financial Strategy
    • Operations Strategy
    • Human Resource Strategy
    • Research and Development

         7. Organisation and Strategic Leadership

    • 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

(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 Financial Analysis

  • Introduction to Financial Management Function
    • Objective and scope of financial management
    • Role and purpose
    • Financial management environment
    • Functions of finance executives in an organization
    • Financial distress and insolvency.
  • Financial Analysis through Ratios
    • Users of the financial analysis
    • Sources of financial data for analysis
    • Calculation and Interpretation of ratios:
      • Analysing liquidity
      • Analysing leverage
      • Analysing solvency
      • Analysing efficiency/ activity
      • Analysing profitability
    • Limitations of ratio analysis

 2.  Financing Decisions

  • Sources of Finance
    • Different Sources of Finance, Characteristics of  different  types  of  long  term debt and equity finance, Method of raising long term finance
    • Different Sources of short term Finance
    • Internal fund as a source of finance
    • International sources of finance
    • Other sources of finance- Sale and lease back, Convertible  debt,  Venture capital, Grants etc.
  • Cost of Capital
    • Significance of cost of capital
    • Factors of cost of capital
    • Measurement of costs of individual components of capital
    • Weighted average cost of capital (WACC)
    • Marginal cost of capital
    • Effective Interest rate
  • Capital Structure Decisions
    • Significance of capital structure
    • Determinants of capital structure
    • Capital structure planning and designing
    • Designing of optimum capital structure
    • T heories of Capital Structure and  value  of the  firm – relevancy and  Irrelevancy of capital structure.
    • EBIT – EPS Analysis, Breakeven- EBIT Analysis.
    • Under/ Over Capitalisation.
  • Leverages
    • Types of Leverages- Operating, Financial and Combined
    • Analysis of leverages

 3. Capital Investment and Dividend Decisions

  • Capital Investment Decisions
    • Objective of capital investment decisions
    • Methods of Investment appraisal:
      1. Payback period, Discounted payback period
      2. Accounting Rate of Return (ARR),
      3. Net Present Value (NPV) – T he  meaning  of  NPV,  Strengths  and limitations of NPV method, T he working capital adjustment in an NPV analysis, Capital rationing, Equivalent Annual Costs,
      4. Internal Rate of return (IRR)- Limitations of  the  IRR  method,  Multiple IRRs,
      5. Modified internal Rate of Return (MIRR)- Definition and explanation of  MIRR, T he process for calculating MIRR, Strengths of the  MIRR  approach.
      6. Profitability Index
  • Adjustment of Risk and Uncertainty in Capital Budgeting Decision
    • Probability Analysis
    • Certainty Equivalent Method
    • Risk Adjusted Discount Rate
    • Scenario Analysis
    • Sensitivity Analysis
  • Dividend Decisions
    • Basics of Dividends
    • Forms of dividend
    • Determinants of dividend
    • Relevancy and Irrelevancy of Dividend Policies- T raditional Approach, Walter’s model, Gordon’s model, Modigliani and Miller (MM) Hypothesis.

 4. Management of Working Capital

  • Management of Working Capital
    1. The management of working capital- Liquidity and Profitability
    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 conversion cycles
    4. Assessment of working capital requirement
    5. Management of Accounts Receivables (Debtors)
    6. Factoring and Forfaiting
    7. Management of Accounts Payables (Creditors)
    8. Management of Inventory
    9. Management of Cash, T reasury management
    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. Determination of National Income

  • Macro Economic Aggregates and Measurement of National Income
  • T he Keynesian Theory of Determination of National Income

 2. The Money Market

  • T he Concept of Money Demand: Important T heories of Demand for Money
  • T he Concept of Money Supply
  • Monetary Policy

 3. Public Finance

  • Fiscal functions: An Overview.
  • Market Failure
  • Government Interventions to Correct Market Failure
  • Fiscal Policy

 4. International Trade

  • Theories of International Trade
  • Trade Policy – T he Instruments of Trade Policy
  • Trade Negotiations
  • Exchange Rates and its economic effects
  • International Capital Movements: Foreign Direct Investment