Changes made in the Syllabus of CA Foundation Paper 1 ... · Mercantile Laws (40 Marks) Mercantile Laws (60 Marks) Changes (Addition/ Deletion) Reasons for changes 1. The Indian Contract

Changes made in the Syllabus of CA Foundation Paper 1: Principles and Practices of Accounting (proposed) vis-a-vis CPT Section A :Fundamentals of Accounting (existing)

Fundamentals of Accounting (60 Marks) as per the existing syllabus

Principles and Practices of Accounting (100 Marks) as per the proposed syllabus

Changes (Addition/ Deletion)

Reasons for changes

1. Theoretical Framework 1. Theoretical Framework (i) Meaning and Scope of accounting

(i) Meaning and Scope of accounting

(ii) Accounting Concepts, Principles and Conventions

(ii) Accounting Concepts, Principles and Conventions

(iii) Accounting Standards – concepts, objectives, benefits

(iii) Accounting Standards – concepts, objectives, benefits

(iv) Accounting Policies (iv) Accounting Policies (v) Accounting as a measurement discipline – valuation principles, accounting estimates

(v) Accounting as a measurement discipline –valuation principles, accounting estimates

2. Accounting Process Books of Accounts leading to the preparation of Trial Balance, Capital and revenue expenditures, Capital and revenue receipts, Contingent assets and contingent liabilities, Fundamental errors including rectifications thereof.

2. Accounting Process Books of Accounts leading to the preparation of Trial Balance, Capital and revenue expenditures, Capital and revenue receipts, Contingent assets and contingent liabilities, Fundamental errors including rectifications thereof.

3. Bank Reconciliation Statement 3. Bank Reconciliation Statement 4. Inventories Basis of inventory valuation and record keeping.

4. Inventories Basis of inventory valuation and record keeping.

5. Depreciation accounting Methods, computation and accounting treatment of depreciation, Change in depreciation methods.

5. Depreciation accounting Methods, computation and accounting treatment of depreciation, Change in depreciation methods.

6. Preparation of Final Accounts for SoleProprietors

6. Preparation of Final Accounts for SoleProprietors

7. Simple problems on Financial Statements of Not-for-Profit Organisations

Addition In the existing curriculum, this topic is covered at Intermediate (IPC) level Paper 1: Accounting. The underlying concepts of this topic is similar to the principles applied for preparation of final accounts. Hence, the basic of preparation of financial statements of Not-for-Profit Organisations has been covered at Foundation level and advanced problems on this topic dealing with sector wise accounting is proposed to be covered at Intermediate level in Paper 1 : Accounting.

8. Accounts from Incomplete Records

Addition In the existing curriculum, this topic is covered at Intermediate (IPC) levelPaper 1: Accounting. The underlying concepts of this topic is also similar to the principles applied for preparation of final accounts. Hence, this topic has also been proposed to be shifted here at Foundation level.

9. Average Due Date and Account Current

Addition In the existing curriculum, this topic is covered at Intermediate (IPC) level Paper 1: Accounting. The technique of average due date is useful for calculating interest on transactions made by the proprietors or partners of a business firm at several points of time. Account current is very useful when frequent transactions take place between the two parties in settlement of their accounts.The underlying concepts of this topic is

applied in other topics of Foundation like bills of exchange and partnership for calculation of interest on capital and drawings.

7. Accounting for Special Transactions


(a) Consignments (a) Consignments (b) Joint Ventures (b) Joint Ventures (c) Bills of exchange and promissory notes

(c) Bills of exchange and promissory notes

(d) Sale of goods on approval or return basis.

(d) Sale of goods on approval or return basis

(e) Departmental accounts. Addition The concepts used in this topic are the basic principles applied for preparation of departmental accounts. Hence the topic has been shifted here from Intermediate (IPC) Paper 5 Advanced Accounting.

8. Partnership Accounts Final accounts of partnership firms – Basic concepts of admission, retirement and death of a partner including treatment of goodwill.

11. Partnership Accounts Final accounts of partnership firms – Basic concepts of admission, retirement and death of a partner including treatment of goodwill.

9. Introduction to Company Accounts Issue of shares and debentures, forfeiture of shares, re-issue of forfeited shares, redemption of preference shares.

12. Introduction to Company Accounts Issue of shares and debentures, forfeiture of shares, re-issue of forfeited shares, redemption of preference shares.

Changes made in the Syllabus of CA Foundation paper 2 (part I): Mercantile Laws (proposed) vis-a-vis Section B: Mercantile Laws (existing).

Mercantile Laws (40 Marks) Mercantile Laws (60 Marks) Changes

(Addition/ Deletion)

Reasons for changes

1. The Indian Contract Act, 1872: An overview of Sections 1 to 75 covering the general nature of contract, consideration, other essential elements of a valid contract, performance of contract and breach of contract.

1. The Indian Contract Act, 1872: An overview of Sections 1 to 75 covering the general nature of contract, consideration, other essential elements of a valid contract, performance of contract and breach of contract.

- -

2. The Sale of Goods Act, 1930: Formation of the contract of sale, Conditions and Warranties, Transfer of ownership and delivery of goods, Unpaid seller and his rights.

2. The Sale of Goods Act, 1930: Formation of the contract of sale, Conditions and Warranties, Transfer of ownership and delivery of goods, Unpaid seller and his rights.

- -

3. The Indian Partnership Act, 1932: General Nature of Partnership, Rights and duties of partners, Registration and dissolution of a firm.

3. The Indian Partnership Act, 1932: General Nature of Partnership, Rights and duties of partners, Registration and dissolution of a firm.

- -

- 4. The Limited Liability Partnership Act, 2008: Introduction- covering nature and scope, Essential features, characteristics of LLP, Incorporation and differences with other forms of organizations.

New addition LLP is a new corporate structure that combines the flexibility of a partnership and the advantages of limited liability of a company at a low compliance cost. With the increasing importance of the LLP in today’s

business scenario, the knowledge of LLP is the requirement of the CA Profession.

- 5. The Companies Act, 2013 [section 1 to 22]: Important definitions, Introduction of company & corporate veil theory, Classes of companies, Conversion of company, Incorporation of company, Memorandum of Association, Articles of Association, Alteration of Memorandum and Articles, Doctrine of Indoor Management, Conversion of companies already registered, Promoters, Service of documents.

New addition [Section 1 to 22 of the Companies Act, 2013 has been shifted from Intermediate (IPC) Paper 2, Business Ethics and Communication, Existing syllabus

Company law is one of the most significant and pervasive statute among the various Corporate legislations and so form an important subject of the chartered accountancy course. The Companies Act, 2013 deals with the law and regulations for the formation and effective working of the corporate entity and to deal with the complexities in the business and corporate world.

Note 1: Here, chapters 1 to 4 carries 45 marks and chapter 5 carries 15 marks Note 2: 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 dates notified by the Institute.

Changes made in the Syllabus of CA Foundation Paper 2 Part-II General English (proposed)

Existing Syllabus General English (40-Marks) as per the proposed syllabus


Reasons for changes

No existing Curriculum

Section A New Paper Curriculum has been designed afresh

Not Applicable Topic :Comprehension Passages and Note Making

Subtopic : Comprehension Passages • Introduction to Comprehension Passages • Kind of Questions asked

Multiple Choice questions Questions requiring short answers

o Central theme o Inference/Conclusion

Questions based on Vocabulary • Steps to comprehend the text • Helpful Hints to answer questions • Points to Ponder • Sample Passages with answers • Exercises with answers Subtopic: Note Making • Introduction to Note Making • Significance of Note Making for students • Detailed Format

Heading(Title)

Sub-heading Indentation Points Use of abbreviations Summary Content Expression

• Steps to Comprehend text • Helpful Hints • Points to Ponder • Sample Passages with Notes • Exercises with answers Section B Developing Writing Skills Subtopic: Article Writing • Format

Title Writer’s Name

• Content (Value points related to the topic) 3-4 Paragraph Para 1 : Brief Introduction of the status of the issue Para 2 : Analysis of the topic in terms of

o Types o Consequences o Causes o Good/bad aspects o related information

Para 3: Implications � social / environmental/Psychological/health related.

Para 4: Concluding Para-Suggestions / reminders.

• Expression Grammatical accuracy, spellings, coherence,

relevance of ideas and style. • Steps to write an article

Ideas associated with the topic Structuring the ideas in a logical progression. Quick Review

Subtopic: Report Writing • What is a Report • Essential elements of Report Writing • Kinds of Reports

Reporting for a Meeting/Assembly Reporting for a Newspaper Reporting for a Magazine

• Detailed Format (for each) Title By- Writer’s Name Place, Date Body

o What o When o Where o Who o How

• Tips and Conventions of Report Writing • Sample Reports • Exercises with Answer hints

Subtopic : Writing Formal Letters • Detailed format

Date Salutation Subject Body of the letter

o First paragraph o Second paragraph

Complimentary Closing • Points to Remember Subtopic : Writing Formal Mails • How to Write a Formal Mail • Writing Effective Mails • Essential elements of Mails

Subject line Formal Greetings Target Audience(Reader) Clarity and Conciseness Formal Closing Proof read Feedback

• Tips and Conventions of Mails • Sample Mails • Exercises with answer hints Subtopic : Resume Writing • Essential Elements of Resume

Name and contact details Objective Summary

Academic Qualifications and Achievements Co-curricular Achievements Training Programs attended/completed Strengths Interests/Hobbies Declaration Signature

• Resume Writing Tips and Conventions • Do’s and Don’ts of Resume Writing • Sample Resumes • Exercises with answer hints Section C: Grammar Subtopic: Introduction to Basic Writing • Introduction • Process of writing • Styles of Writing • Significance of writing skills for students • Writing Conventions • Characteristics of good writing • How to make writing effective • Do’s and Don’ts of good writing Subtopic: Basic English Grammar(Nouns, Pronouns and Verbs) • Nouns: Definition, Examples

Different types and categories of nouns(Classification with examples) o Common and Proper Noun o Abstract and Concrete Noun

o Countable and Uncountable Noun o Compound Noun o Collective Noun o Verbal Noun and Gerunds

• Pronouns: Definition, Examples Different categories of Pronouns(Classification with

examples) o Subject Pronoun o Object Pronoun o Possessive Adjectives/Determiners o Possessive Pronouns o Reflexive Pronouns o Intensive Pronouns o Indefinite Pronouns o Demonstrative Pronoun o Relative Pronoun o Interrogative Pronoun o Reciprocal Pronoun

• Verbs: Definition, Examples Different categories of Verbs(Classification with

examples) o Action and Stative Verbs o Transitive and Intransitive Verbs o Auxiliary and Modal Verbs o Irregular Verbs o Phrasal Verbs

Different Verb Forms

Simple Continuous Perfect Perfect Continuous

Simple Present

Present Continuous

Present Perfect

Present Perfect Continuous

Simple Past

Past Continuous

Past Perfect

Past Perfect Continuous

Simple Future

Future Continuous

Future Perfect

Future Perfect Continuous

Subtopic: Articles, Adjectives and Adverbs • Articles: Definition, Examples

Types of Articles(classification with examples) o Definite Article o Indefinite Articles

Difference in usage of ‘a’ and ‘an’ Difference in usage of ‘a’ and ‘the’ Usage of ‘the’ When to use and when not to use Articles

• Adjectives: Definition, Examples Classification of Adjectives(with examples)

o Adjectives of quality o Adjectives of quantity o Adjectives of Number o Demonstrative Adjectives o Interrogative Adjectives o Coordinate Adjectives o Non-coordinate adjectives

Order of placement of different kinds of adjectives in a

sentence • Adverbs: Definition, Examples

Usage of adverbs Adverb basics Forming adverbs form adjectives Classification of Adverbs(with examples)

o Comparative Adverbs o Superlative Adverbs o Adverbs of place(location and prepositions) o Adverbs of movement o Adverbs of time(specific time, time period,

periodicity) o Adverbs of manner o Adverbs of degree o Adverbs of certainty

Subtopic: Prepositions, Conjunctions and Interjections • Prepositions: Definition, Examples

Simple Prepositions, Double Prepositions Compound Prepositions Participle Prepositions Phrase Prepositions Prepositions of time Prepositions of place Prepositions of movement.

• Conjunctions: Definition, Examples • Classification of Conjunctions(with examples)

Coordinating Conjunctions

Subordinating Conjunctions o Subordinating conjunctions of time o Subordinating conjunctions of place o Subordinating conjunctions of reason o Subordinating conjunctions of purpose o Subordinating conjunctions of condition o Subordinating conjunctions of comparison

Correlative Conjunctions Compound Conjunctions

• Interjection: Definition ,Examples • Classification of Interjections(with examples)

Mild Interjection Strong Interjection

Subtopic: Sentence Types, Direct-Indirect, Active -Passive Speech • Sentence: Definition • Classification of sentence based on connotation

Assertive sentences Interrogative sentences Imperative sentences Exclamatory sentences Optative sentences

• Sentence Structure Subject and Predicate Verb (Auxiliary, Finite) Object (Direct , Indirect) Complement Adjunct or Adverbial

• Sentence Clause Structure • Types of Clauses

Independent clauses Dependent clauses Relative or noun clauses Types of sentences Simple sentence Compound sentence Complex sentence Compound-complex sentence

• Direct-Indirect Speech: Introduction • Procedure for converting Direct speech into Indirect

speech Rules for converting Direct speech into Indirect

speech Change in pronouns Change in tenses Change in modals Changes for Imperative sentences Changes for Exclamatory sentences Changes for Interrogative sentences Punctuation in Direct speech

• Procedure for converting Indirect speech into Direct speech Rules for converting Indirect speech into Direct

speech • Active Passive Voice: Introduction

Usage Active Vs passive voice

Reasons for using Passive voice Changing Passive voice to Active voice Changing Active voice to Passive voice Suggestions for using Active and Passive voice

• Verbs Voice Active or passive

• Verbs Mood Indicative Imperative Subjunctive

Subtopic : Vocabulary Root Words, Synonyms, Antonyms, Prefixes, Suffixes), Phrasal verbs, Collocations and Idioms. • Introduction

Types of Vocabulary Significance of improving vocabulary How to improve vocabulary List of commonly used words with usage

• Root words • Synonyms and Antonyms • Words formed by using Prefixes • Words formed by using Suffixes • Phrasal verbs • Collocations • Idioms • Exercises with answers

Reason for Addition / Deletion of the topics: Foundation Course –Paper 3-Business Mathematics Logical Reasoning and Statistics (100 Marks)

S.No CPT- Quantitative Aptitude (50 Marks)

Foundation Course -Business Mathematics Logical Reasoning and

Statistics (100 Marks)

Adding/ Deletion

Reason

A. Business Mathematics and Logical Reasoning (60 Marks

A. Mathematics (25 marks) Business Mathematics and Logical Reasoning (40 Marks )

1

Ratio and Proportion and Indices and Logarithms.

• Numbers, Laws of Indices, Exponents and

• Logarithms and Anti Logarithms • Ratio and proportion and Time and

work related problems.

same topic in CPT Chapter one deals with applications of basic fundamental tools for all calculations in Business and Finance. Ratio and proportion are very useful business applications.

2 Equations: Linear Simultaneous linear equations up to three variables, Quadratic and Cubic equations in one variable. Equations of Straight line, Intersection of Straight lines

• Equations: Linear Simultaneous linear equations up to three variables, Quadratic and Cubic equations in one variable.

• Algebra of Matrices, Inverse of a Matrix and determinants, solving system of equations using matrix method (Cramer’s rule) involving not more than three variables.

The topics related Coordinate Geometry deleted. (Rest of the topic in CPT) and Matrices is a new topic in this chapter

Coordinate Geometry applications are too mathematical and the objective in this chapter to find out the unknown variables similar method we are used using the solving equations. Matrices helps to find the unknown variables. Which helps formation of linear programming problems in maximization and minimization problems.

3 Inequalities: Linear Inequalities in one variable and the solution space

Inequalities: Linear Inequalities in one variable and the solution space

same topic in CPT Helps to formation of linear programming problems in maximization and minimization problems.

4 Simple Interest And Compound interest including annuity applications

Time value of Money • Simple Interest • Compound interest • Effective Rate of Interest • Present Value • Net Present Value • Future Value • Perpetuity • Annuities • Sinking Funds • Calculating of EMI

Same topic in CPT (Removed from FM in IPCC and shifted here)

Time value of money Interest rates and Annuity applications are very useful for Chartered accountant students.

Calculations of Returns: • Nominal Rate of Return • Compound Annual growth rate (CAGR)

This is a new topic This topics are useful in Financials and to calculate interests

5 Basic Concepts of Permutations and Combinations

Basic concepts of Permutations and combinations: Introduction, the factorial, permutations, results, circular permutations, permutations with restrictions, Combinations with standard results.

Same topic in CPT Permutation and combination applications are useful in Finance applications and Risk Management also.

6 Introduction Sequences, Series, Arithmetic and Geometric progression

Introduction Sequences, Series, Arithmetic and Geometric progression

Same topic in CPT Arithmetic and geometric series applications are used in the area of Finance.

7 Sets ,Functions and Relations Sets ,Functions and Relations Same topic in CPT Sets, Functions are very important to understand relation in Economic and Business Functions.

8 • Limits and Continuity intuitive approach

• Limits and Continuity intuitive approach (Deleted)

Deleted Limits and continuity functions are not much useful for CA students and they are too mathematical also.

9 Basic applications of Differential and Integral calculus (Excluding the trigonometric applications)

Basic applications of Differential and Integral calculus (Excluding the trigonometric applications)

Same topic in CPT Differential calculus is used to find the Marginal concepts with respect to linear or non-linear change of functions. With the help of Integral Cal calculus we can find the total cost ,Total Revenues When Marginal Cost and Marginal Revenues are known

Logical Reasoning (20 Marks) 10 Number series coding and Decoding and

odd man out. All the topics of Logical reasoning topics are new .Since this subject has been introduced in the proposed scheme.

To test the analytical ability of the students

11 Blood Relations, 12 Seating Arrangements, 13 Direction Tests 14 Syllogism. B. Statistics (25 Marks) B. Business Statistics (40 Marks) Addition /deletion Reason 15 Statistical Representation of Data,

Diagrammatic representation of data, Frequency distribution, Graphical representation of Frequency Distribution – Histogram, Frequency Polygon, Ogive, Pie-chart.

Statistical Representation of Data, Diagrammatic representation of data, Frequency distribution, Graphical representation of Frequency Distribution – Histogram, Frequency Polygon, Ogive, Pie-chart.

Same topic in CPT It’s used to understand the data collections of sampling and pictorial representation of data

16 Measures of Central Tendency and Dispersion: Mean Median, Mode, Mean Deviation, Quartiles and Quartile Deviation, Standard Deviation, Co-efficient of Variation, Coefficient of Quartile Deviation.

Measures of Central Tendency and Dispersion: Mean Median, Mode, Mean Deviation, Quartiles and Quartile Deviation, Standard Deviation, Co-efficient of Variation, Coefficient of Quartile Deviation

Same topic in CPT The statistical tools like Mean ,Standard Deviation and Variance are very useful for CA

17 Correlation and Regression: Scatter diagram, Karl Pearson’s Coefficient of Correlation Rank Correlation, Regression lines, Regression equations, Regression coefficients

Correlation and Regression: Scatter diagram, Karl Pearson’s Coefficient of Correlation Rank Correlation, Regression lines, Regression equations, Regression coefficients

Same topic in CPT With the help of the correlation and regression can understand the relation between variables

18 Probability and Expected value by Mathematical Expectation

Probability and Expected value by Mathematical Expectation

Same topic in CPT Probability applications are used in Finance and Risk Management.

19 Theoretical Distribution: Binomial Distribution, Poisson distribution – basic application and Normal Distribution – basic applications.

Theoretical Distribution: Binomial Distribution, Poisson distribution – basic application and Normal Distribution – basic applications

Same topic in CPT Theoretical distributions are useful in Finance and Cost Management applications

20 Sampling Theory : Basic Principles of Sample survey, Comparison between sample survey and enumeration, errors in Sample survey, some important terms associated with sampling, types of sampling

Sampling Theory and testing of hypothesis (a) Basic Principles of Sample survey, Comparison between sample survey and enumeration, errors in Sample survey, some important terms associated with sampling, types of sampling. (b) Testing of Hypothesis, Large sample tests (Test for means, test for proportions and test for Standard deviations) and sample tests applications of t, F-distribution (Variance ratio test) and Chi-square test.

Same topic of sampling theory Testing of hypothesis is added

Sampling techniques are very useful in auditing also. Testing of Hypothesis tools provides a basis for taking ideas or theories someone initially develops the economy or investing markets , and then deciding whether these ideas or true or false .Testing of hypothesis tools helps to decide whether the tested ideas are probably true or false with the help of this tools can analyses the results

21 Index Numbers and Time series Uses of Index Numbers, Problems involved in construction of Index Numbers, Methods of construction of Index Numbers.

Index Numbers and Time series Uses of Index Numbers, Problems involved in construction of Index Numbers, Methods of construction of Index Numbers. Time Series Analysis – basic application including Moving Average, Moving Average Method, and Method of Least Squares.

Same topic in CPT Time Series part added

Index numbers and Time series analysis are very useful for framing the suitable business and economic policies, useful deflating and adjusting data. Useful for calculating changes in wages in inflationary conditions and useful Cost of Living index numbers.

Section C: General Economics (50 marks)

Paper 4*: Business Economics & Business and Commercial Knowledge (100 Marks)


Reasons for changes

(I) Micro Economics Part I: Business Economics (60 Marks) Additions 1. Introduction to Micro Economics

(a) Definition, scope and nature of Economics

(b) Methods of economic study (c) Central problems of an

economy and Production possibilities curve.

1. Introduction to Business Economics (a) Meaning of Business Economics (b) Objectives of Business Firm- Profit

Maximization, Sales Maximization, Growth Maximization.

Introduction to Business Economics (a) Meaning of Business

Economics (b) Objectives of Business

Firm- Profit Maximization, Sales Maximization, Growth Maximization.

These are added as the name of the subject has been changed from General Economics to Business Economics and it is desirable to introduce the new subject including its meaning, nature and subject matter to students.

2. Theory of Demand and Supply (a) Meaning and determinants of

demand, Law of demand and Elasticity of demand – Price, income and cross elasticity

(b) Theory of consumer’s behavior – Marshallian approach and Indifference curve approach

(c) Meaning and determinants of supply, Law of supply and Elasticity of supply.

2. Theory of Demand and Supply (a) Meaning and determinants of demand, Law of

demand and Elasticity of demand ─ Price, income and cross elasticity

(b) Theory of consumer’s behaviour – Marshallian approach and Indifference curve approach

(c) Meaning and determinants of supply, Law of supply and Elasticity of supply.

(d) Demand Forecasting

Demand Forecasting Forecasting of demand, which is the art of predicting demand for a product or a service at some future date on the basis of certain present and past behaviour patterns of some related events, is being taught here as the survival of businesses today, to a great extent, depends upon the extent to which they can predict the demand for their products and services in future accurately. The students should be aware of various techniques of demand forecasting, it is felt.

3. Theory of Production and Cost (a) Meaning and Factors of

production (b) Laws of Production – The

Law of variable proportions and Laws of returns to scale

(c) Concepts of Costs – Short

3. Theory of Production and Cost (a) Meaning and Factors of production (b) Laws of Production – The Law of Variable

proportions and Laws of Returns to Scale, Producer’s equilibrium

(c) Concepts of Costs ─ Short-run and long-run costs, Average and marginal costs, Total, fixed

run and long run costs, Average and marginal costs, Total, fixed and variable costs.

and variable costs.

4. Price Determination in Different Markets (a) Various forms of markets –

Perfect Competition, Monopoly, Monopolistic Competition and Oligopoly

(b) Price determination in these markets.

4. Price Determination in Different Markets (a) Various forms of markets – Perfect

Competition, Monopoly, Monopolistic Competition and Oligopoly

(b) Price determination in these markets.

(II) Indian Economic Development 5. Indian Economy A Profile 6. Select Aspects of Indian Economy 7. Economic Reforms in India 8. Money and Banking

Dealt in Intermediate in the paper on business economic environment

5. Business Cycles • Meaning of Business Cycles • Phases of Business Cycles • Features of Business Cycles. • Causes behind these Cycles.

Addition Business Cycles

Every business undergoes phases of ups and downs during its lifetime. These phases in economic activity may be of short duration or long duration and these are called business cycles. A knowledge of the concept of Business Cycles is important for students as it helps them to understand the various economic events taking place in the real world- like great depression, financial crisis, booms etc.

Changes made in the Syllabus of CA Foundation Paper 4 Part-II Business and Commercial Knowledge (proposed)

Existing Syllabus Business and Commercial Knowledge (40-Marks) as per the proposed syllabus


Reasons for changes

No existing Curriculum

New Paper. Curriculum has been designed afresh.

None

1. Introduction to Business Nature of Business, Profession and Employment.

Objectives of Business. Business and Commercial Knowledge. Economic and Non-Economic Activities.

2. Business Environment Micro and Macro Environment, Elements of Micro

Environment – Consumers/Customers, Competitors, Organization, Market, suppliers, Intermediaries, Elements of Macro Environment – Demographic, Economic, Political-legal, Socio-cultural, Technological, Global Environment.

3. Business organizations Top Indian and Global Companies. 4. Government Policies for Business Growth

Policies creating conducive business environment – Startups,E-commerce. Liberalization, Privatization, Foreign Direct Investment.

5. Organizations facilitating Business Indian regulatory bodies - SEBI, RBI, IRDA, CCI, FMC,

CBDT, CBEC Indian Development Banks – IFCI, IDBI, SIDBI, EXIM

Bank,NABARD Global organizations and world trade bodies – IMF, ADB,

WTO, OECD, SAARC, ASEAN, OPEC. Accounting Bodies – IFAC,IASB, IESB, CAPA, SAFA,

AOSSG. 6. Common Business and Commercial Terminologies Finance, Marketing and other business terms. Stock Market

Terminology.

Changes made in the Syllabus of CA Intermediate Paper 1: Accounting (proposed)

vis-a-vis Intermediate (IPC) Paper 1 : Accounting (existing)

Accounting as per the existing syllabus Accounting as per the proposed syllabus


Reasons for changes

1. A General Knowledge of the

framing of the accounting standards,

national and international accounting

authorities, adoption of international

financial reporting standards

1. Process of formulation of Accounting Standards including Ind ASs

and their convergence with International Financial Reporting Standards (IFRSs) and various other International accounting standard setting bodies.

Modification At Final level, it is proposed to discuss all Ind AS at length.Accordingly, it was felt necessary to introduce Ind AS at Intermediate level by including the formulation of Ind AS and briefing theknowledge regarding various international accounting standard setting bodies, before studying the same in detail at Final level.

2. Framework for Preparation and Presentation of Financial Statements (as per Accounting Standard)

Addition Framework sets out the concepts that underlie the preparation and presentation of financial statements for external users. It assist preparers of financial statements in applying AS and in dealing with topics that have yet to form the subject of AS. Hence, it was decided to include this topic here only before teaching the basic AS.

2. Accounting Standards - Working

knowledge of:

3. Accounting Standards:

AS 1 : Disclosure of Accounting

Policies

AS 1 : Disclosure of Accounting Policies

AS 2 : Valuation of Inventories AS 2 : Valuation of Inventories

AS 3 : Cash Flow Statements AS 3 : Cash Flow Statements

AS 4 : Contingencies and Events occurring after the Balance Sheet Date

Addition Earlier only 18 standards were covered at Intermediate level i.e. 9 AS in Paper 1 : Accounting and 9 AS in Paper 5 : Advanced Accounting. After inclusion of Ind AS and AS at Final level, it was felt that the content of the paper will not commensurate with 100 marks. So all

the standards has been shifted at Intermediate level i.e. 13 AS in Paper 1 and 15 AS in Paper 5. To accommodate 13 AS in Paper 1 Accounting, above AS which are covered in the existing syllabus in Paper 5 : Advanced Accounting have been shifted herebased on the intricacies

involved in each of the standard.

AS 5 : Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies

Addition

AS 6 : Depreciation Accounting AS 6 : Depreciation Accounting

AS 7 : Construction Contracts

(Revised 2002)

AS 7 : Construction Contracts (Revised 2002)

AS 9 : Revenue Recognition AS 9 : Revenue Recognition

AS 10 : Accounting for Fixed

Assets

AS 10 : Accounting for Fixed Assets

AS 11 : The Effects of Changes in Foreign Exchange Rates (Revised 2003)

Addition Earlier only 18 standards were covered at Intermediate level i.e. 9 AS in Paper 1 : Accounting and 9 AS in Paper 5 : Advanced Accounting. After inclusion of Ind AS and AS at Final level, it was felt that the content of the paper will not commensurate with 100 marks. So all

AS 12 : Accounting for Government Grants

Addition

the standards has been shifted at Intermediate level i.e. 13 AS in Paper 1 and 15 AS in Paper 5. To accommodate 13 AS in Paper 1 Accounting, above AS which are covered in the existing syllabus in Paper 5 : Advanced Accounting have been shifted herebased on the intricacies

involved in each of the standard.

AS 13 : Accounting for

Investments

AS 13 : Accounting for Investments

AS 14 : Accounting for

Amalgamations Deletion In the existing curriculum, the topic of

„Accounting for Amalgamation‟ is also covered at Intermediate (IPC) level in Paper 5. In the new proposed syllabus, repetition has been avoided and this standard is now shifted at Paper 5 of Intermediate level alongwith the

respective topic.

AS 16 : Borrowing Costs Addition Earlier only 18 standards were covered at Intermediate level i.e. 9 AS in Paper 1 : Accounting and 9 AS in Paper 5 : Advanced Accounting. After inclusion of Ind AS and AS at Final level, it was felt that the content of the paper will not commensurate with 100 marks. So all

the standards has been shifted at Intermediate level i.e. 13 AS in Paper 1 and 15 AS in Paper 5. To accommodate 13 AS in Paper 1 Accounting, above AS which are

covered in the existing syllabus in Paper 5 : Advanced Accounting have been shifted herebased on the intricacies involved in each of the standard.

3. Company Accounts 4. Company Accounts

(a) Preparation of financial statements – Profit and Loss Account, Balance Sheet and Cash Flow Statement,

Statement of changes in Equity and

Explanatory Notes.

(a) Preparation of financial statements – Statement of Profit and Loss, Balance Sheet and Cash Flow

Statement, Statement of changes in Equity and Explanatory Notes;

(b) Profit (Loss) prior to

incorporation

(b) Profit (Loss) prior to incorporation;

(c) Alteration of share capital, Conversion of fully paid shares into stock and stock into shares, Accounting for

bonus issue

(c) Alteration of share capital, Accounting for bonus issue.

Partial Deletion

Specific mention to this topic “Conversion of fully paid shares into stock and stock into shares” has been removed. However, it will be covered under the topic “Alteration of share

capital”

(d) Simple problems on Accounting for business acquisition, Amalgamation and reconstruction (excluding problems of

amalgamation on inter-company holding)

Deletion In the existing curriculum, this topic is also covered at Intermediate (IPC) level in Paper 5. In the new proposed syllabus, repetition has been avoided and this topic is now shifted at Paper 5 of Intermediate level alongwith the

respective AS.

5. Cash flow Analysis. Addition In the existing curriculum, this topic forms part of Financial Management. However, AS 3 deals with Cash flow statement, hence, analysis of cash flow statement is proposed to be shifted

here.

4. Average Due Date, Account

Current, Self-Balancing Ledgers Deletion The concepts underlying in the topics of

Average due date and account current are basic in nature. Also The underlying concepts of these topics are applied in other topics of Foundation like bills of exchange and partnership for calculation of interest on capital and drawings. Hence these topics are shifted at Foundation level. However, after computerization of accounting and development of various accounting softwares, the relevance of self balancing ledgers has been reduced. Therefore, most of the organizations have stopped following this system and hence the topic on self balancing has been removed from the syllabus.

5. Financial Statements of Not-for-Profit Organisations

8. Advanced Problems on Financial Statements of Not-for-Profit Organisations.

Modification In the existing curriculum, this topic is covered at Intermediate (IPC) level. The underlying concepts of this topic is similar to the principles applied for preparation of final accounts. Hence, the basic of preparation of financial statements of Not-for-Profit Organisations has been covered at Foundation level and advanced problems on this topic dealing with sector wise accounting is proposed to be covered at Intermediate level in

Paper 1 : Accounting.

6. Accounts from Incomplete

Records Deletion The underlying concepts of this topic is

also similar to the principles applied for preparation of final accounts. Hence, this topic has also been proposed to be shifted here at Foundation level.

7. Accounting for Special

Transactions

6. Accounting for Special Transactions:

(a) Hire purchase and instalment

sale transactions Deletion This topic uses the concept of AS 19

which is proposed in the syllabus of Paper 5 Advanced Accounting. Therefore, the topic is also shifted to that paper.

(b) Investment accounts (a) Investment Accounting and

(c) Insurance claims for loss of

stock and loss of profit.

(b) Insurance claims for loss of stock and loss of profit.

(c) Branch accounts including foreign branches.

Addition In the existing curriculum, this topic is covered at Intermediate (IPC) level in Paper 5. In the new proposed syllabus, since AS 11 has been included in this paper, the topic related to it i.e. Branch accounts including foreign branches is

now shifted here.

8. Issues in Partnership Accounts 7. Advanced Issues in Partnership Accounts in respect of

Final accounts of partnership firms – Admission, retirement and death of a

partner including treatment of goodwill.

Admission, Retirement and Death of a Partner including treatment of

goodwill,

Dissolution of partnership firms including piecemeal distribution of assets;

Addition In the existing curriculum, this topic is covered at Intermediate (IPC) level in

Amalgamation of partnership firms; Conversion into a company and Sale to a company; Issues related to accounting in Limited Liability Partnerships.

Paper 5. In order to bring all the sub topics of partnership at one place, this

topic has been shifted here.

9. Accounting in Computerised

Environment

An overview of computerized accounting system–Salient features and significance, Concept of grouping of accounts, Codification of accounts, Maintaining the hierarchy of ledger, Accounting packages and consideration for their selection,

Generating Accounting Reports.

Deletion This topic has been proposed to be shifted in the Intermediate paper of Information Technology and is proposed to be covered there under the heading „Accounting Information System‟. The practical aspects of the same is also

covered in the 100 hours ITT.

Note : If either old Accounting Standards (ASs), Announcements and Limited Revisions to ASs are withdrawn or new ASs, Announcements and Limited Revisions to ASs are issued by the Institute of Chartered Accountants of India in place of existing ASs, Announcements and Limited Revisions to ASs, the syllabus will accordingly exclude/include such new developments in place of the existing ones with effect from the date to be notified by

the Institute.

Note : 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 ASs 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.

Changes made in the Syllabus of CA Intermediate (IPC) paper 2: Corporate and Other Laws (proposed) vis-a-vis Paper 2: Business Laws, Ethics and Communication (existing).

Business Laws, Ethics and Communication (100 Marks)

Corporate and Other Laws (100 Marks) Changes (Addition/ Deletion)

Reasons for changes

PART I- BUSINESS LAW (60 MARKS) Business Law (30 Marks) PART II- Other Laws (40 Marks)

1. The Indian Contract Act, 1872 The Indian Contract Act, 1872 (Specific contracts covered from section 76 onwards): Contract of Indemnity and Guarantee, Bailment, Pledge, Agency

- -

2. The Negotiable Instruments Act, 1881

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 Payment of Bonus Act, 1965 The Payment of Bonus Act, 1965: Applicability, Definitions, Entitlement of payment of bonus, Minimum and Maximum bonus, Calculation of bonus, Miscellaneous provisions

- -

4. The Employees’ Provident Fund and Miscellaneous Provisions Act, 1952

The Employees’ Provident Fund and Miscellaneous Provisions Act, 1952: Introduction, Definition, Various Schemes and other provisions

- -

5. The Payment of Gratuity Act, 1972 The Payment of Gratuity Act, 1972: Extent & Applicability, Definitions, Payment of Gratuity, Calculation, Nominations & Miscellaneous provisions

- -

Interpretation of statutes and Drafting of simple deeds and documents: Rules of Interpretation of statutes, Aids to interpretation,

New topic added [shifted from Final

This topic helps in the understanding of the law and

Rules of Interpretation/construction of Deeds and Documents, Drafting of Resolution, Minutes, Notices and Reports.

paper 4: Corporate and Allied Laws, Existing syllabus]

improves writing skill as to drafting of simple deeds and documents .

The Prevention of Money Laundering Act, 2002- Basic structure: Preliminary and Punishment for the Offence of Money laundering

New Act added [shifted the basic structure from Final paper 4: Corporate and Allied Laws, Existing syllabus and advance portion of this Act will remain in the Final.

The students are required to have the knowledge of the same in order to point out the frauds committed by the corporates.

The Consumer Protection Act, 1986: Definitions and Application of the Act, Consumer Disputes Redressal agencies and Miscellaneous provisions.

New Act added Being student, knowledge is required to safeguard the interest being a consumer in one or the other through the redressal forums.

Tabular Format of major Labour Acts covering their name, preamble and basic comments

Newly added To keep apprise the students regarding the major Labour Acts covering their name preamble and basic comments.

Company Law (30 Marks) PART I: Corporate law (60 Marks) The Companies Act, 2013 – Sections 1 to 122

(a) Preliminary (b) Incorporation of Company and Matters Incidental thereto (c) Prospectus and Allotment of Securities (d) Share Capital and Debentures

The Companies Act, 2013 – Sections 1 to 122 (a) Preliminary (b) Incorporation of Company and Matters Incidental thereto (c) Prospectus and Allotment of Securities (d) Share Capital and Debentures e) Acceptance of Deposits by companies

-

(e) Acceptance of Deposits by companies

(f) Registration of Charges (g) Management and Administration (i) Company Law in a computerized Environment – E-filing.

(f) Registration of Charges (g) Management and Administration (i) Company Law in a computerized Environment – E-filing.

Part II – ETHICS (20 Marks) - Deleted Covered in other CA papers 1. Introduction to Business Ethics 2. Environment issues 3. Ethics in Workplace 4. Ethics in Marketing and Consumer

Protection 5. Ethics in Accounting and Finance Part III- COMMUNICATION (20 Marks) - Deleted Covered in other CA papers

1. Elements of Communication 2. Communication in Business

Environment 3. Basic understanding of legal deeds

and documents

Note 1: 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.

Note 2: 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 dates 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.

Changes made in the Syllabus of CA Intermediate Paper 3: Cost and Management Accounting (proposed) vis-a-vis

Paper 3: Cost Accounting (existing).

Cost Accounting (50 Marks) Cost and Management Accounting (100 Marks) Changes (Addition/ Deletion)

Reasons for changes

1. Introduction to Cost Accounting

(a) Objectives and scope of Cost Accounting

(b) Cost centres and Cost units

(c) Cost classification for stock valuation, Profit

measurement, Decision making and control

(d) Coding systems

(e) Elements of Cost

(f) Cost behaviour pattern, Separating the

components of semi-variable costs

(g) Installation of a Costing system

(h) Relationship of Cost Accounting, Financial

Accounting, Management Accounting and Financial

Management.

A. Overview of Cost and Management Accounting

(a) Introduction to Cost and Management Accounting

(i) Objectives and Scope of Cost and Management Accounting,

(ii) The users of Cost and Management accounting information- Functions of management accounting.

(iii) Role of cost accounting department in an organisation and its relation with other departments.

(iv) Installation of Costing System

(v) Relationship of Cost Accounting, Financial Accounting, Management Accounting and Financial Management.

(vi) Cost terms and Concepts

(vii) Cost Reduction and Cost Control

(viii) Elements of Costs

(ix) Cost behavior pattern, Separating the components of semi-variable costs, step costs.

(x) Methods of Costing, Techniques of Costing.

(xi) Coding Systems.

Topics have been elaborated and specified to cover basic cost concepts of cost and management accounting.

(b) Elements of Cost and preparation of Cost Sheet

(i) Functional classification and ascertainment of cost (ii) Preparation of Cost Sheet

Additions:

(b)Elements of Cost and preparation of Cost Sheet

(i) Functional classification and ascertainment of cost (ii) Preparation of

Understanding of cost sheet is essential for the students to familiarize them with the basic cost concepts.

Cost Sheet

2. Cost Ascertainment

(a) Material Cost

(i) Procurement procedures— Store procedures

and documentation in respect of receipts and

issue of stock, Stock verification

(ii) Inventory control —Techniques of fixing of

minimum, maximum and reorder levels,

Economic Order Quantity, ABC classification;

Stocktaking and perpetual inventory

(iii) Inventory accounting

(iv) Consumption — Identification with products of

cost centres, Basis for consumption entries in

financial accounts, Monitoring consumption.

B. Ascertainment of Cost and Cost Accounting System

(a) Material Cost

(i) Procurement procedures- Store procedures and documentation in respect of receipts and issue of stock, Stock verification,

(ii) Valuation of material receipts,

(iii) 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,

FSN, HML, VED, Just-in-Time (JIT)- Stock taking

and perpetual inventory system, use of control

ratios,

(iv) Inventory Accounting

(v) Consumption- Identification with products of cost centres, Basis for consumption entries in financial accounts, monitoring consumption.

Topics have been elaborated and specified to cover specific aspects of Material cost.

(b) Employee Cost

(i) Attendance and payroll procedures, Overview

of statutory requirements, Overtime, Idle time

and Incentives

(ii) Labour turnover

(iii) Utilisation of labour, Direct and indirect labour,

Charging of labour cost, Identifying labour

hours with work orders or batches or capital

jobs

(b) Employee Cost

(i) Attendance and Payroll procedures-

- Elements of wages- Basic wages, Dearness Allowance, Overtime, Bonus, Holiday and leave wages, Allowances and perquisites.

(ii) Labour Cost Control

(iii) Labour Turnover- Methods of calculating labour turnover, causes of labour turnover, effects of labour turnover.

(iv) Utilisation of labour, Direct and indirect labour, charging of labour cost, Identifying labour hours with

Topics have been elaborated and specified to cover specific aspects of Employee cost.

(iv) Efficiency rating procedures

(v) Remuneration systems and incentive

schemes.

work orders or batches or capital jobs.

(v) Remuneration systems and incentive schemes-

-Time Rate System, Piece Rate System, Differential piece rate system, Calculation of wages, Effective Wages.

(c) Direct Expenses

Sub-contracting — Control on material

movements, Identification with the main product

or service.

(c) Direct Expenses

(i) Direct expenses and Direct Material

(ii) Nature of Direct or Chargeable expenses.

(iii) Sub-contracting- Control on material movements, Identification with the main product or service.

Topics have been elaborated.

(d) Overheads

(i) Functional analysis — Factory,

Administration, Selling, Distribution, Research

and Development Behavioural analysis —

Fixed, Variable, Semi variable and Step cost

(ii) Factory Overheads — Primary distribution

and secondary distribution, Criteria for

choosing suitable basis for allotment,

Capacity cost adjustments, Fixed absorption

rates for absorbing overheads to products or

services

(iii) Administration overheads — Method of

allocation to cost centres or products

(iv) Selling and distribution overheads — Analysis

and absorption of the expenses in

products/customers, impact of marketing

strategies, Cost effectiveness of various

methods of sales promotion.

(d) Overheads

(i) Functional analysis- Factory, Administration, Selling, Distribution, Research and Development.

(ii) Behavioral analysis- Fixed, Variable, Semi- Variable and Step cost.

(iii) Allocation and Apportionment of overheads using Absorption Costing Method.

(iv) Factory Overheads- Primary distribution and secondary distribution,

(v) Administration Overheads- Method of allocation to cost centres or products,

(vi) Selling & Distribution Overheads- Analysis and absorption of the expenses in products/ customers, impact of marketing strategies, cost effectiveness of various methods of sales promotion.

(vii) Concepts of Activity Based Costing (ABC).

Additions:

Concepts of Activity Based Costing (ABC)

Basic understanding of Activity Based Costing is essential at this level so that student are well versed with the concept of overhead.

3. Cost Book-keeping

Cost Ledgers—Non-integrated accounts,

(e) Recording and Accounting of Costs

(i) Non-integrated Accounting system- Ledger under

Integrated accounts, Reconciliation of cost and

financial accounts.

non-integral system

(ii) Integrated Accounting system- Ledgers under integral system.

(iii) Relationship and difference between the Non- integrated Accounting system and Integrated Accounting system.

(iv) Reconciliation of Cost and Financial Accounts.

4. Costing Systems C. Methods of Costing

(a) Job Costing

Job cost cards and databases, Collecting direct

costs of each job, Attributing overhead costs to

jobs, Applications of job costing.

(a) Job Costing

Job cost cards and databases, Collecting direct costs of each job, Attributing overhead costs to jobs, Applications of job costing.

(b) Batch Costing (b) Batch Costing

Determination of optimum batch quantity, Ascertainment of cost for a batch, Preparation of batch cost sheet, Treatment of spoiled and defective works.

(c) Contract Costing

Progress payments, Retention money,

Escalation clause, Contract accounts,

Accounting for material, Accounting for plant

used in a contract, Contract profit and Balance

sheet entries.

(c) Contract Costing

(i) Ascertainment of cost of a contract, Progress payment, Retention money, Escalation clause, Cost plus contract, Value of work certified, Cost of Work not certified.

(ii) Determination Value of work certified, Cost of work not certified, Notional and Estimated profit from a contact.

Deletion:

Contract profit and Balance sheet entries.

In this subject only the cost part of the contract is covered. Contract Accounting is covered in Accounting subject at the same level.

(d) Process Costing

Double entry book keeping, Process loss,

Abnormal gains and losses, Equivalent units, Inter-

process profit, Joint products and by products.

(d) Process/ Operation Costing

(i) Double entry book keeping, Process loss, Abnormal gains and losses, Equivalent units, Inter-process profit, Valuation of work in progress.

(ii) Joint Products- Apportionment of joint costs, Methods of apportioning joint cost over joint products,

(iii) By-Products- Methods of apportioning joint costs over by-products, treatment of By-product cost in

Cost Accounting.

(e) Operating Costing System (e) Operating Costing System

(i) Determination of Costs, Profit and Prices of services of following sectors/ Industries:

- Transport, Hospitals, Canteen/ Restaurants, Hotels/ Lodges, Schools/ Colleges, Financial Institutions/ Banks

D. Cost Control and Analysis

5. Introduction to Marginal Costing

Marginal costing compared with absorption

costing, Contribution, Breakeven analysis and

profit volume graph.

(a) Marginal Costing

(i) Determination of Cost of a product/ service under marginal costing method, determination of cost of finished goods, work-in-progress,

(ii) Comparison of Marginal costing with absorption costing method- Reconciliation of profit under the both methods,

(iii) Basic concepts of marginal costing, Contribution margin, Break-even analysis, Break –even and profit volume charts, Contribution sales ratio, Margin of Safety, Angle of Incidence, Cost-Volume-Profit Analysis (CVP), Multi- product breakeven analysis, Limiting factor (key factor),

(iv) Short term decision making using the above concepts (basic level).

Additions:

(i) Determination of Cost of a product/ service under marginal costing method, determination of cost of finished goods, work-in-progress,

(iv) Short term decision making using the above concepts (basic level).

It is essential for the students to understand basic application of marginal costing at this level so that they can cope up with the ―detailed and in-depth decision making at Final level‖.

6. Introduction to Standard Costing

Various types of standards, Setting of

standards, Basic concepts of material and

Labour standards and variance analysis.

(b) Standard Costing

(i) Setting up of Standards, Types of Standards, Standard Costing as method of performance measurement.

(ii) Calculation of Variances-

-Material Cost Variance, Labour Cost Variance,

Variable Overheads Variance, Fixed Overhead

Variance and Sales Variances.

7. Budget and Budgetary Control (c) Budget and Budgetary Control

(i) Meaning of Budget, Essentials of Budget, Budget

Additions:

(iv) Introduction to

Concepts of the added topic are covered to

The budget manual, preparation and monitoring

procedures, budget variances, flexible budget,

preparation of functional budget for operating

and non operating functions, cash budget,

master budget, principal budget factors.

Manual, Budget setting process, Preparation of Budget and monitoring procedures.

(ii) The use of budget in planning and control

(iii) Flexible budget, Preparation of Functional budget for operating and non operating functions, Cash budget, Master budget,

(iv) Introduction to Principal budget factor, Zero Based Budgeting (ZBB), Performance budget, Control ratios and Budget variances.

Principal budget factor, Zero Based Budgeting (ZBB), Performance budget, Control ratios and Budget variances.

have a completed basic understanding of the topic.

Note: Only application of Cost Accounting Standards (CAS) will be discussed here.

Comparative Statement of old and New Syllabus of IPCC/Intermediate along with the examination pattern for examination.

Existing Scheme Draft Revised Scheme Added/Deleted/Shifted

Comments/Reasons

Intermediate (Integrated Professional Competence) Course (IPC)

Intermediate Course

Group I Group I

Paper - 4:Taxation (100 arks)

Paper 4: Direct Tax Laws & Indirect Tax Laws

(100 Marks)

Part - I: Income Tax (50 Marks) PART I: Direct Tax Laws (60 Marks)

Objectives:

(a) To gain knowledge of the provisions of

Income-tax law relating to topics

mentioned in the contents below and

(b) To gain ability to solve simple problems

concerning assessees with the status of

‘individual’ covering the areas mentioned in

the contents below

Objective:

To develop an understanding of the provisions

of income-tax law and different indirect tax

laws and to acquire the ability to apply such

knowledge to make computations and address

other issues in non-complex scenarios.

Objective

Modified

Objective statement has been redrafted to

align with the requirement of working

knowledge at Intermediate level, to ensure

clarity in the competence requirement at the

said level and make the same relevant in the

context of both academic education and work

place requirement.

1. Important definitions in the Income-tax Act,

1961

2. Basis of charge; Rates of taxes applicable

for different types of assessees

3. Concepts of previous year and assessment

year

1. Basic Concepts

• Income-tax law: An introduction

• Important definitions in the Income-tax Act, 1961

• Basis of Charge and Rates of Tax

• Concept of previous year and assessment year

No change Topic-wise contents have been

incorporated in the revised syllabus to give

the students a broad idea of the overall

coverage of various topics under Income-

tax law.

4. Residential status and scope of total

income; Income deemed to be received

/deemed to accrue or arise in India

2. Residential status and scope of total income

• Residential status

• Scope of total income

• Deemed receipt and accrual of income in India

No change Though the marks allocation for the existing

syllabus of IIPCC Paper 4: Taxation [Part I:

Income-tax] is 50 marks, the coverage of

income-tax law in the present syllabus justifies

marks allocation of 75 marks. It may be noted

that the same syllabus of erstwhile PCC for 75

marks is now being covered for 50 marks in

IIPCC, with the exception of computation of

total income and tax liability of HUFs.

The marks coverage has been increased from

50 to 60 marks in the new Intermediate

Course. However, since the coverage of

Income-tax law in the existing syllabus of

IIPCC justifies 75 marks, no new topic is being

included in the syllabus of Income-tax in the

new Intermediate Course.

5. Incomes which do not form part of total

income 3. Incomes which do not form part of total income

• Incomes not included in total income

• Tax holiday for newly established units in Special Economic Zones

• Charitable and religious trusts and institutions: Basic concepts

No change

6. Heads of income and the provisions

governing computation of income under

different heads

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

No change

7. Income of other persons included in

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

• 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

• Cross transfers

• Conversion of self-acquired property into property of HUF

• Other provisions relating to clubbing of income

No change

8. Aggregation of income; Set-off or carry

forward and set-off of losses 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

• Inter-source and Inter-head adjustments

• Provisions governing set-off and carry forward and set-off of losses under different heads of income

• Order of set-off of losses

• Other provisions relating to set-off and carry forward of losses

No change

9. Deductions from gross total income 7. Deductions from gross total income

• General provisions

• Deductions in respect of payments

• Specific deductions in respect of income

• Other deductions

No change

10. Computation of total income and tax

payable; Rebates and reliefs 8. Computation of total income and tax liability

of resident Individuals

• Meaning of total income

• Income to be considered while computing total income of resident individuals

• Special provisions for spouses governed by Portuguese civil code

• Procedure for computation of total income and tax liability of resident individuals

No change

11. Provisions concerning advance tax and tax

deducted at source 9. Provisions concerning advance tax and tax

deducted at source

• Introduction

• Direct Payment

• Provisions concerning deduction of tax at source

No change

• Certificate for deduction of tax at a lower rate

• No deduction in certain cases

• Miscellaneous Provisions relating to deduction of tax at source

• Advance payment of tax

• Interest for defaults in payment of advance tax and deferment of advance tax

12. Provisions for filing of return of income. 10. Provisions for filing return of income

• Return of Income

• Compulsory filing of return of income

• Interest for default in furnishing return of income

• Specified class or classes of persons to be exempted from filing return of income

• Return of loss

• Return of income of charitable trusts and institutions, political parties, universities, colleges etc.

• Provisions relating to belated return, revised return etc.

• Permanent account number

• Persons authorized to verify return of income

• Other provisions relating to return of income

No change

Note: If new legislations are enacted in place

of the existing legislations the syllabus will

accordingly include the corresponding

provisions of such new legislations in the place

of the existing legislations with effect from the

date to be notified by the Institute. Students

shall not be examined with reference to any

particular State VAT Law

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

Note modified • Note to syllabus modified. If any

legislation ceases to have effect, the

syllabus will accordingly exclude such

legislation from a date to be notified by

the Institute.

• Note to also refer to introduction of the

concept of Study Guide to indicate

specific inclusions in and exclusions

from the syllabus before each

VAT Law. Further, considering that Goods and

Services Tax may be implemented in India in near

future, the syllabus will accordingly be modified to

include the same with effect from the date to be

notified by the Institute.

Consequential/corresponding amendments

made in the provisions of the direct and

indirect 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 by way of Study Guide before each

examination.

examination.

• Note to specifically clarify that

consequential/corresponding

amendments made in the provisions of

direct tax laws covered in the syllabus

of this paper which arise out of the

amendments made in the provisions of

direct tax laws falling outside the

scope of syllabus will not form part of

the syllabus of intermediate course.

Comparative Statement of changes made in the syllabus of CA Intermediate Paper 4 (Part II): Indirect Tax Laws (proposed) vis-a-vis Paper 4 (Part II): Indirect Taxes (existing).

Existing Syllabus Revised Syllabus Changes (Addition/Deletion) Comments/Reasons

Intermediate (Integrated Professional Competence) Course (IPC)

Intermediate Course

Group I Group I

Paper - 4:Taxation (100 Marks)

Paper 4: Direct Tax Laws & Indirect Tax Laws (100 Marks)

Part II: Indirect Taxes (50 Marks) Part II: Indirect Tax Laws (40 Marks)

Objective: To develop an understanding

of the basic concepts of the different

types of indirect taxes and to acquire the

ability to analyse the significant

provisions of service tax.

Objective: To develop an understanding of

the provisions of income-tax law and

different indirect tax laws and to acquire the

ability to apply such knowledge to make

computations and address other issues in

non-complex scenarios.

Objective modified

Objective statement has been redrafted to align with the required knowledge at Intermediate level, to ensure clarity in the competence requirement at the said level and make the same relevant in the context of both academic education and work place requirement.

Introduction to excise duty, customs duty,

central sales tax and VAT – Constitutional

aspects, Basic concepts relating to levy,

taxable event and related provisions

Concept of indirect taxes - General

principles, Constitutional aspects

• Concept and features of indirect taxes

• Constitutional provisions of indirect taxes

• Principal indirect taxes

• Administration of indirect taxes

Topic-wise contents incorporated.

Central Excise Duty and Customs Duty

• Concept of excise duty, Types of excise

duties, Sources of central excise law

• Taxable event, Charge of excise duty,

Concept of goods and excisable goods,

Manufacture, Collection of excise duty,

• Classification and valuation of excisable

goods1

• Small Scale Industry (SSI) exemption

• Concept of customs duty, Types of customs

duties, Sources of customs law

• Taxable event, Charge of customs duty

including exceptions thereof

1 An overall idea of the concept of classification and scheme of valuation excluding related rules

•Classification and valuation of imported/export

goods2

• Date for determining the rate of duty and tariff

valuation of imported and exported goods

Central Sales Tax

• Basic concepts relating to inter-State sale

• Sale outside a State

• Sale in the course of import or export

• Charge of central sales tax

• Inter-State stock transfer

• Rates of tax on inter-State sale

• Determination of turnover

• Levy and collection of central sales tax and

goods of special importance in inter-State

trade

Value Added Tax

• Basic concepts relating to VAT including its

variants, different methods of computation and

2 An overall idea of the concept of classification and scheme of valuation excluding related rules

merits and demerits

• State-Level VAT

• Backdrop for State–Level VAT in India

• Concepts relating to input tax credit

• Computation of net VAT liability

• VAT rates

• Composition scheme for small dealers

• VAT in relation to incentive schemes

• Works contract

• Lease transactions and hire purchase

transactions

Significant provisions of service tax

(i) Constitutional Aspects

(ii) Basic Concepts and General Principles

(iii) Charge of service tax including

negative list of services

Service tax3

(i) Basic Concepts and general principles

(ii) Concept of service, charge of service tax,

negative list of services, date of determination

of rate of tax, value of taxable service and rate


3 Declared service [Section 66E], Determination of place of provision of service [Section 66C and Place of Provision of Services Rules, 2012], Bundled Services

[Section 66F] are excluded from the syllabus. Consequently, discussion/reference of such provisions in any of the topics/provisions covered in the syllabus will also be excluded from the syllabus.

(iv) Point of taxation of services

(v) Exemptions and Abatements

(vi) Valuation of taxable services

(vii) Invoicing for taxable services

(viii) Payment of service tax

(ix) Registration

(x) Furnishing of returns

of exchange

(iii) Point of taxation of services

(iv) Exemptions and abatements

(v) Valuation of taxable services

(vi) Registration

(vii) Invoicing for taxable service

(viii) Payment of service tax including reverse

charge

(ix) Furnishing of returns

CENVAT credit [Rule 1-9 of CENVAT

Credit Rules, 2004]

Deleted CENVAT Credit Rules

[Rule 1-9] omitted

from the syllabus:

Considering the

reduction in marks

(from 50 to 40),

CENVAT credit rules

have been removed

from the syllabus.

Moreover, it is felt that

these rules are too

complex for

Intermediate students

to comprehend.

Note: If new legislations are enacted in place of the existing legislations the syllabus will accordingly include the corresponding provisions of such new legislations in the place of the existing legislations with effect from the date to be notified by the Institute. Students shall not be examined with reference to any particular State VAT Law

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 VAT Law. Further, considering that Goods and Services Tax may be implemented in India in near future, the syllabus will accordingly be modified to include the same with effect from the date to be notified by the Institute. Consequential/corresponding amendments made in the provisions of the direct and indirect 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 by way of Study Guide before each examination.

• Note to syllabus modified to include a specific reference to GST.

• Note to also refer to introduction of the concept of Study Guide to indicate specific inclusions in and exclusions from the syllabus before each examination.

Changes made in the Syllabus of CA Intermediate Paper 5: Advanced Accounting (proposed)

vis-a-vis Intermediate (IPC) Paper 5 :Advanced Accounting (existing)

Advanced Accounting as per the existing syllabus

Advanced Accounting (100 Marks) as per the proposed syllabus


Reasons for changes

1. Framework for Preparation and Presentation of Financial Statements

Deletion The framework sets out the concepts underlying the preparation and presentation of general-purpose financial statements prepared by enterprises for external users. The development of accounting standards or any other accounting guidelines need a foundation of underlying principles. Therefore, proposed to be shifted to Paper 1: Accounting at

Intermediate.

2. Accounting Standards - Working knowledge of:

1. Accounting Standards:

AS 4 : Contingencies and Events occurring after the Balance Sheet Date

Deletion Earlier only 18 standards were covered at Intermediate level i.e. 9 AS in Paper 1 : Accounting and 9 AS in Paper 5 : Advanced Accounting. After inclusion of Ind AS and AS at Final level, it was felt that the content of the paper will not commensurate with 100 marks. So all the standards has been shifted at Intermediate level i.e. 13 AS in Paper 1 and 15 AS in Paper 5. To accommodate 13 AS, above AS which are covered in the existing syllabus in

AS 5 : Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies

Deletion

AS 11 : The Effects of Changes in

Foreign Exchange Rates (Revised 2003) Deletion

AS 12 : Accounting for Government Grants

Deletion

Paper 5 : Advanced Accounting have been shifted in Paper 1 : Accounting based on the intricacies involved in each of the standard.

AS 14 : Accounting for Amalgamations Addition The syllabus of Paper 1: Financial Reporting at Final level has been developed on the basis of Ind ASs. It has been decided to teach all the standards at Intermediate level by allocating them to both the papers based on the intricacies involved in each of the standard. Hence AS 14, 15, 17, 18, 21, 22, 23, 24, 25, 27 and 28 have been added here at this paper for balancing the syllabi of Accounting

papers in CA. Course.

AS 15 : Employee Benefits Addition

AS 16 : Borrowing Costs Deletion Earlier only 18 standards were covered at Intermediate level i.e. 9 AS in Paper 1 : Accounting and 9 AS in Paper 5 : Advanced Accounting. After inclusion of Ind AS and AS at Final level, it was felt that the content of the paper will not commensurate with 100 marks. So all the standards has been shifted at Intermediate level i.e. 13 AS in Paper 1 and 15 AS in Paper 5. To accommodate 13 AS, above AS which are covered in the existing syllabus in Paper 5 : Advanced Accounting have been shifted in Paper 1 : Accounting based on the intricacies involved in

each of the standard.

AS 17: Segment Reporting Addition The syllabus of Paper 1: Financial Reporting at Final level has been developed on the basis of Ind ASs. It has been decided to teach all the standards at Intermediate level by allocating them to both the papers based on the intricacies involved in each of the standard. Hence AS 14, 15, 17, 18, 21, 22, 23, 24, 25, 27 and 28 have been added here at this paper for balancing the syllabi of Accounting


AS 18 : Related Party Disclosures Addition

AS 19 : Leases AS 19 : Leases

AS 20 : Earnings Per Share AS 20 : Earnings Per Share

AS 21 : Consolidated Financial Statements

Addition The syllabus of Paper 1: Financial Reporting at Final level has been developed on the basis of Ind ASs. It has been decided to teach all the standards at Intermediate level by allocating them to both the papers based on the intricacies involved in each of the standard. Hence AS 14, 15, 17, 18, 21, 22, 23, 24, 25, 27 and 28 have been added here at this paper for balancing the syllabi of Accounting


AS 22 : Accounting for Taxes on Income

Addition

AS 23 : Accounting for Investments in Associates in Consolidated Financial Statements

Addition

AS 24 : Discontinuing Operations Addition

AS 25 : Interim Financial Reporting Addition

AS 26 : Intangible Assets AS 26 : Intangible Assets

AS 27 : FinancialReporting of Interest Addition The syllabus of Paper 1: Financial

in Joint Ventures Reporting at Final level has been developed on the basis of Ind ASs. It has been decided to teach all the standards at Intermediate level by allocating them to both the papers based on the intricacies involved in each of the standard. Hence AS 14, 15, 17, 18, 21, 22, 23, 24, 25, 27 and 28 have been added here at this paper for balancing the syllabi of Accounting


AS 28 : Impairment ofAssets Addition

AS 29 : Provisions, Contingent Liabilities and Contingent Assets.

AS 29 : Provisions, Contingent Liabilities and Contingent Assets.

3. Advanced Issues in Partnership Accounts and Issues related to accounting in Limited Liability Partnerships

Dissolution of partnership firms including piecemeal distribution of assets; Amalgamation of partnership firms; Conversion into a company and Sale to a company.

Deletion The topic of Partnership has been decided to be shifted to Intermediate in Paper 1 Accounting to balance the syllabi of Accounting Papers The entire topic of Partnership Accounts has been decided to be taught at paper 1 only.

4. Company Accounts 2. Company Accounts

(a) Accounting for employee stock option plan, Buy back of securities, Equity shares

with differential rights, Underwriting of shares and debentures, Redemption of debentures

(a) Accounting for employee stock option plan, Buy back of securities, Equity shares

with differential rights, Underwriting of shares and debentures, Redemption of debentures;

(b) Advanced problems for business acquisition, Amalgamation and

(b) Accounting for business acquisition, Amalgamation and reconstruction;

reconstruction (excluding problems of amalgamation of inter-company holding)

(c) Accounting involved in liquidation of companies, Statement of Affairs (including deficiency/surplus accounts) and Iiquidator’s statement of account of the winding up

(c) Accounting involved in liquidation of companies, Statement of Affairs (including deficiency/surplus accounts) and Iiquidator’s statement of account of the winding up;

(d) Financial Reporting of

Insurance and Banking and legal and regulatory requirements thereof

(d) Financial Reporting of Insurance,

Banking companies and Non-Banking Financial Companies and legal and regulatory requirements thereof.

Partial

Addition

Financial Reporting of Non-Banking

Financial Companies

The syllabus of Paper 1: Financial Reporting at Final level has been developed on the basis of Ind ASs. Since Ind AS suffice the 100 marks coverage of the paper at Final level, this topic has been shifted from Final to this paper at Intermediate.


Departmental Accounts Deletion Topic of Departmental accounts proposed to be shifted at Foundation Paper 1: Principles and Practices of Accounting as it is a simple topic.

Branch accounts including foreign branches

Deletion Topic of Branch Accounting has been shifted to Intermediate in Paper 1 : Accounting to balance the syllabi of

Accounting Papers .

3. Accounting for Hire Purchase Transactions

Addition AS 19 forms part of paper 5 syllabus, therefore, this topic is also included

here.

4. Valuation of goodwill Addition The syllabus of Paper 1: Financial Reporting at Final level has been developed on the basis of Ind ASs. Since Ind AS suffice the 100 marks coverage of the paper at Final level, many topics have been shifted from Final to IIPC. The topic of valuation of goodwill has been shifted here because

the concept of valuation of goodwill is applied in many topics covered in the syllabus of this paper, namely

amalgamation.

5. Application of Guidance Notes issued by the ICAI on various accounting aspects. (List attached for reference)

Addition It has been decided to teach some of the Guidance Notes at Intermediate level based on the intricacies involved in it.

Note – If either old Accounting Standards (ASs), Announcements and Limited Revisions to ASs are withdrawn or new ASs, Announcements and Limited Revisions to ASs are issued by the Institute of Chartered Accountants of India in place of existing ASs, Announcements and Limited Revisions to ASs, the syllabus will accordingly include/exclude such new developments in place of the existing ones with effect from the date to be notified by the Institute.

Note : 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 notified.

The list of Guidance Notes in Accounting applicable in this paper for a particular exam will be issued separately before the respective examination.

Partial Addition

List of Guidance Notes has been added here since few Guidance Notes are proposed to be covered here.

Annexure

Guidance Notes on Accounting Aspects applicable at Intermediate level

1. Guidance Note on Accrual Basis of Accounting.

2. Guidance Note on Terms Used in Financial Statements.

3. Guidance Note on Availability of Revaluation Reserve for Issue of Bonus Shares.

4. Guidance Note on Accounting for Corporate Dividend Tax.

5. Guidance Note on Accounting for Employee Share-based Payments.

6. Guidance Note on Measurement of Income Tax for Interim Financial Reporting in the context of AS 25.

7. Guidance Note on Applicability of AS 25 to Interim Financial Results.

8. Guidance Note on Turnover in case of Contractors.

9. Guidance Note on the Revised Schedule VI to the Companies Act, 1956 (Now Schedule III to the Companies Act, 2013).

10. Guidance Note on Accounting for Depreciation in companies in the context of Schedule II to the Companies Act, 2013

http://resource.cdn.icai.org/41241research31047.pdf





Changes made in the Syllabus of CA Intermediate Paper 6: Auditing and Assurance (proposed) vis-a-vis Paper 6:

Auditing and Assurance (existing).

Auditing and Assurance (100 Marks) Auditing and Assurance (100 Marks) Changes (Addition/ Deletion)

Reasons for changes

1. Auditing Concepts ─ Nature and limitations of

Auditing, Basic Principles governing an audit,

Ethical principles and concept of Auditor’s

Independence, Relationship of auditing with

other disciplines.

2. Standards on Auditing and Guidance Notes ─

Overview, Standard-setting process, Role of

International Auditing and Assurance

Standards Board, Standards on Auditing

issued by the ICAI; Guidance Note(s) on ─

Audit of Fixed Assets, Audit of Inventories,

Audit of Investments, Audit of Debtors, Loans

and Advances, Audit of Cash and Bank

Balances, Audit of Miscellaneous Expenditure,

Audit of Liabilities, Audit of Revenue, Audit of

Expenses and provision for proposed

dividends.

3. Auditing engagement.

1. Nature, Objective and Scope of Audit

Nature, objective and scope of Audit;

Relationship of auditing with other disciplines;

Overview, Standard-setting process, Role of

International Auditing and Assurance Standards

Board; Standards on Auditing, Guidance

Note(s) issued by the ICAI; Inherent Limitations

of an audit; Ethical requirements relating to an

audit of financial statements; Preconditions for

an audit; Audit Engagement; Agreement on

Audit Engagement Terms; Terms of

Engagement in Recurring Audits; Leadership

Responsibilities for Quality on Audits; Concept

of Auditor’s Independence; Threats to

Independence; Acceptance and Continuance of

Client Relationships and Audit Engagements;

Responsibility for the Prevention and Detection

of Fraud; Fraud Risk Factors; Risks of Material

Misstatement Due to Fraud; Communication of

Fraud to Management and those charged with

governance.

Deletion:

Basic Principles governing an audit.

Basic Principles governing an audit are not at all part of the SAs anymore. Earlier these were discussed in SAP 1.

4. Documentation ─ Audit working papers, Audit

files: Permanent and current audit files,

Ownership and custody of working papers.

5. Audit evidence ─ Audit procedures for

obtaining evidence, Sources of evidence,

Reliability of audit evidence, Methods of

obtaining audit evidence ─ Physical

2. 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; Audit procedures for obtaining

audit evidence; Sources of evidence; Relevance

verification, Documentation, Direct

confirmation, Re-computation, Analytical

review techniques, Representation by

management, Obtaining certificate.

and Reliability of audit evidence; Sufficient

appropriate 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; Obtaining evidence of

inventory; Audit procedure to identify litigation &

claims; External confirmation procedures;

Management's refusal to allow the auditor to

send a confirmation request; Negative

Confirmations; Audit evidence about opening

balances; Accounting policies relating to

opening balances; Reporting with regard to

opening balances; Meaning of Related Party;

Nature of Related Party Relationships &

Transactions; Understanding the Entity's

Related Party Relationships & Transactions;

Meaning of Subsequent Events; Auditor's

obligations in different situations of 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.

3. Audit planning, Audit programme, Control of

quality of audit work ─ Delegation and

supervision of audit work.

3. Audit Strategy, Planning and Programming

Audit Strategy; Audit planning; Audit

programme; Control of quality of audit work -

Delegation and supervision of audit work;

Materiality and Audit Plan; Revision of

Materiality; Documenting the Materiality;

Addition:

Audit strategy

Shifted from CA Final Paper 3 Advanced Auditing and Professional Ethics subject. Keeping in view the terms and intent of SA 300, audit

Performance Materiality; Concept of Principal

Auditor and Other Auditor; Acceptance as

Principal Auditor; Procedures to be performed

by Principal Auditor; Co-ordination between the

Principal Auditor and Other Auditor;

Relationship between the Internal Audit

Function and the External Auditor; Using the

work of the Internal Auditor; Documenting the

work of Internal Auditor; Auditor's Expert -

Meaning; Need for an Auditor’s Expert;

Understanding the Auditor’s Expert; Agreement

with the Auditor’s Expert; Adequacy of the

Auditor’s Expert’s Work.

strategy may be discussed along with planning and programming.

6. Internal Control ─ Elements of internal control,

Review and documentation, Evaluation of

internal control system, Internal control

questionnaire, Internal control check list, Tests

of control, Application of concept of materiality

and audit risk, Concept of internal audit.

7. Internal Control and Computerized

Environment, Approaches to Auditing in

Computerised Environment.

4. Risk Assessment and Internal Control

Risk Assessment procedures; Understanding

the entity and its environment; Identifying and

Assessing the Risk of Material Misstatement;

Documenting the Risks; Elements of internal

control; Review and documentation; Evaluation

of internal control system; Internal control

questionnaire; Internal control check list; Tests

of control; Internal Control and IT Environment;

Application of concept of materiality and audit

risk; Concept of internal audit.

Deletion: Approaches to Auditing in Computerised Environment

To be covered in Part I of Paper 8: Information Technology at Intermediate Level.

8. Auditing Sampling ─ Types of sampling, Test

checking, Techniques of test checks.

9. Analytical review procedures.

5. Audit Sampling and Analytical Procedure

Meaning of Audit Sampling; Designing an audit

sample; Types of sampling; Sample Size and

selection of items for testing; Sample selection

method; Test checking; Techniques of test

checks; Nature of analytical procedures;

Designing and performing analytical

procedures; Investing the results of analytical

procedures.

10. Audit of payments ─ General considerations,

Wages, Capital expenditure, Other payments

and expenses, Petty cash payments, Bank

payments, Bank reconciliation.

11. Audit of receipts ─ General considerations,

Cash sales, Receipts from debtors, Other

Receipts.

12. Audit of Purchases ─ Vouching cash and

credit purchases, Forward purchases,

Purchase returns, Allowance received from

suppliers.

13. Audit of Sales ─ Vouching of cash and credit

sales, Goods on consignment, Sale on

approval basis, Sale under hire-purchase

agreement, Returnable containers, Various

types of allowances given to customers, Sale

returns.

14. Audit of suppliers' ledger and the debtors'

ledger ─ Self-balancing and the sectional

balancing system, Total or control accounts,

Confirmatory statements from credit customers

and suppliers, Provision for bad and doubtful

debts, Writing off of bad debts.

15. Audit of impersonal ledger ─ Capital

expenditure, deferred revenue expenditure and

revenue expenditure, Outstanding expenses

and income, Repairs and renewals, Distinction

between reserves and provisions, Implications

of change in the basis of accounting.

16. Audit of assets and liabilities.

6. Audit of Items of Financial Statements

Audit of various items of Financial Statements

for e.g. Audit of Sales, Purchase, Receipts,

Payments; Verification of Bank Balances;

Vouching of items of Income & Expenses;

Verification of Capital and Revenue

Expenditure; Verification of Assets and

Liabilities, Contingent Liabilities; etc. Audit of

ledgers for e.g. supplier’s ledger, debtor’s

ledger etc.

17. Company Audit ─ Eligibility, Qualifications and

Disqualifications of Auditors, Appointment of

auditors, Removal of auditors, Remuneration

7. The Company Audit- I

Eligibility, Qualifications and Disqualifications of

of Auditors, Powers and duties of auditors,

Branch audit , Joint audit , Reporting

requirements under the Companies Act,2013,

Other Important Provisions under the

Companies Act, 2013 relating to Audit and

Auditors and Rules made thereunder.

18. Audit Report ─ Qualifications, Disclaimers,

Adverse opinion, Disclosures, Reports and

certificates.

Auditors; 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; Forming an opinion on the Financial

Statements; Auditor's Report- basic elements;

Types of Modified Opinion; Basis for

Modification Paragraph; Opinion Paragraph;

Emphasis of Matter and Other Matter

Paragraph in the Auditor's Report;

Qualifications, Disclaimers, Adverse opinion;

Disclosures; Other Important Provisions under

the Companies Act, 2013 relating to Audit and

Auditors and Rules made thereunder; Nature of

Comparative Information; Corresponding

Figure; Comparative Financial Statements.

17. Audit of Shares 8. The Company Audit- II

Audit of Shares, Debentures, Dividends;

Verification of issue of Bonus Shares; Specific

provisions as regards accounts in the

Companies Act, 2013.

9. Audit of Banks and Insurance Companies

Audit of various items forming part of financial

statements in case of banks and insurance

companies.

Addition:

Audit of Banks and Insurance Companies.

Students at the Intermediate Level while going through the articleship training must have idea of fundamentals of Bank audits and Insurance company audit. Further accounting of Banking and Insurance Companies is also covered at Intermediate Level,

therefore, to make it compatible with Accounting subject, the said topics should be introduced in Auditing subject at Intermediate Level.

19. Special points in audit of different types of

undertakings, i.e., Educational institutions,

Hotels, Clubs, Hospitals, Hire-purchase and

leasing companies (excluding banks, electricity

companies, cooperative societies, and

insurance companies).

20. Features and basic principles of

government audit, Local bodies and not-for-

profit organizations, Comptroller and Auditor

General and its constitutional role.

10. Audit of Different Category of Entities

Features and basic principles of government

audit; Local bodies and not-for-profit

organizations; Comptroller and Auditor General

and its constitutional role; Basics of Limited

Liability Partnerships (LLPs) audit; Audit of

different type of undertakings, i.e., Educational

institutions, Hotels, Clubs, Hospitals, Hire-

purchase and leasing companies.

Addition:

Basics of Limited Liability Partnerships (LLPs) audit.

At Intermediate Level, students are being taught audits of various entities like hotels, partnership firms, cinema etc. Due to introduction of Limited Liability Partnerships (LLPs) in the Companies Act itself, it becomes desirable that the students learn how to audit the LLPs.

Note:

(i) 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.

(ii) 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.

Note:

(i) 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.

(ii) 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.

Note: Chapters are restructured in accordance with latest Engagement and Quality Control Standards.

Changes made in the Syllabus of CA Intermediate Paper 7: Financial Management (proposed) vis-a-vis Paper 3: Part-II

Financial Management (existing).

Financial Management (50 Marks) Financial Management (60 Marks) Changes (Addition/ Deletion) Reasons for changes

A. Financial Management and

Financial Analysis

1. Scope and Objectives of Financial

Management

(a) Meaning, Importance and

Objectives

(b) Conflicts in profit versus value

maximisation principle

(c) Role of Chief Financial Officer.

(a) Introduction to Financial

Management Function:

(i) Objective and scope of financial

management

(ii) Role and purpose

(iii) Financial management environment

(iv) Functions of finance executives in

an organization

(v) Financial distress and insolvency.

Addition:

(v) Financial distress and insolvency.

It is relevant for today’s business scenario.

2. Time Value of Money

Compounding and Discounting

techniques— Concepts of Annuity

and Perpetuity

Shifting/ Deletions:

Compounding and Discounting techniques— Concepts of Annuity and Perpetuity.

Shifted to CA Foundation Paper 3: Business Mathematics, Logical reasoning and Statistics

3. Financial Analysis and Planning

(a) Ratio Analysis for performance

evaluation and financial health

(b) Application of Ratio Analysis in

decision making

(c) Analysis of Cash Flow Statement.

(b) Financial Analysis through

Ratios

(i) Users of the financial analysis

(ii) Sources of financial data for

analysis

(iii) Calculation and Interpretation of

ratios:

Shifting/ Deletions:

(c) Analysis of Cash Flow

Statement.

Shifted to CA Intermediate

Paper 1: Accounting

Analysing liquidity, Analysing leverage,

Analysing efficiency/ activity, Analysing

profitability

(iv) Limitations of ratio analysis

B. Financing Decisions

5. Types of Financing

(a) Different sources of finance

(b) Project financing — Intermediate

and long term financing

(c) Negotiating term loans with banks

and financial institutions and

appraisal thereof

(d) Introduction to lease financing

(e) Venture capital finance.

(a) Sources of Finance

(i) Different Sources of Finance,

Characteristics of different types of

long term debt and equity finance,

Method of raising long term finance

(ii) Different Sources of short term

Finance

(iii) Internal fund as a source of finance

(iv) International sources of finance

(v) Other sources of finance- Sale and lease back, Convertible debt, Venture capital, Grants etc.

(a) Cost of Capital — Weighted

average cost of capital and

Marginal cost of capital

(b) Cost of Capital

(i) Significance of cost of capital

(ii) Factors of cost of capital

(iii) Measurement of costs of individual

components of capital

(iv) Weighted average cost of capital

(WACC)

(v) Marginal cost of capital

(b) Capital Structure decisions —

Capital structure patterns,

Designing optimum capital

structure, Constraints, Various

capital structure theories

(c) Capital Structure Decisions

(i) Significance of capital structure

(ii) Capital structure planning and

designing

(iii) Designing of optimum capital

structure

(iv) Determinants of capital structure

(v) Theories of Capital Structure and

value of the firm- relevancy and

Irrelevancy of capital structure.

(vi) EBIT- EPS Analysis, Breakeven-

EBIT Analysis.

(vii) Under/ Over Capitalisation.

(c) Business Risk and Financial Risk

— Operating and financial

leverage, Trading on Equity.

(d) Leverages

(i) Types of Leverages- Operating,

Financial and Combined

(ii) Analysis of leverages

C. Capital Investment and Dividend Decisions

6. Investment Decisions

(a) Purpose, Objective, Process

(b) Understanding different types of

projects

(c) Techniques of Decision making:

Non-discounted and Discounted

Cash flow Approaches — Payback

Period method, Accounting Rate of

(a) Capital Investment Decisions

(i) Objective of capital investment

decisions

(ii) Methods of Investment appraisal:

- Payback period, Discounted

payback period

- Accounting Rate of Return

Return, Net Present Value, Internal

Rate of Return, Modified Internal

Rate of Return, Discounted

Payback Period and Profitability

Index

(d) Ranking of competing projects,

Ranking of projects with unequal

lives.

(ARR),

- Net Present Value (NPV)- The

meaning of NPV, Strengths and

limitations of NPV method, The

impact of taxation on the 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,

Multiple IRRs,

- Modified internal Rate of Return

(MIRR)- Definition and explanation

of MIRR, The process for

calculating MIRR, Strengths of the

MIRR approach.

- Profitability Index

(b) Dividend Decisions

(i) Basics of Dividends

(ii) Forms of dividend

(iii) Determinants of dividend

(iv) Relevancy and Irrelevancy of

Dividend Policies- Traditional

Approach, Walter’s model,

Gordon’s model, Modigliani and

Miller (MM) Hypothesis.

Additions:

(b) Dividend Decisions

(i) Basics of Dividends

(ii) Forms of dividend

(iii) Determinants of dividend

(iv) Relevancy and Irrelevancy of Dividend Policies- Traditional Approach, Walter’s model, Gordon’s model, Modigliani and Miller (MM) Hypothesis.

Basic function of financial management is divided into three parts (i) Financing decisions (ii) Investment decisions and (iii) Dividend decisions. Though the first two are already in the subject, the third one is required to be incorporated to give holistic view of the subject. Accordingly shifted from CA Final Paper 2:

Strategic Financial Management.

D. Management of Working Capital

7. Management of Working Capital

(a) Working capital policies

(b) Funds flow analysis

(c) Inventory management

(d) Receivables management

(e) Payables management

(f) Management of cash and

marketable securities

(g) Financing of working capital.

(a) Management of Working Capital

(i) The management of working

capital- Liquidity and Profitability

(ii) The Working capital financing

decisions- Primary and

Secondary Sources of Liquidity

(iii) The working Capital Cycle

(operating Cycle), Effectiveness

of Working Capital based on its

operating and cash conversion

cycles

(iv) Assessment of working capital

requirement

(v) Management of Accounts

Receivables (Debtors),

(vi) Management of Accounts

Payables (Creditors)

(vii) Management of Inventory

(viii) Management of Cash, Treasury

management

(ix) Banking norms of working capital finance

Shifting/ Deletion:

Funds flow analysis

Cash flow analysis is

covered in Intermediate-

Paper-1: Accounting so

Fund Flow analysis is not

specifically covered here.

Part II: Business Economic

Environment

(40 Marks)

Changes

(Addition/ Deletion)

Reasons for changes

1. Business and Its Economic

Environment

I. Introduction

II. Elements of Business

Economic Environment

Economic Systems

Economic Conditions

Economic Policies

2. Economic Environment in India

I. Economic Planning and

Economic Reforms in India

Objectives of Planning in

India

Five-Year Plans

Economic Reforms

II. Various Sectors in India-

Agriculture, Industry, Service

and Infrastructure

Agriculture

Industry

Industrial Growth and

Diversification

Industrial Policy in India

Industrial Policy Resolution 1948


New subjected added Today, Chartered Accountants are heading businesses in various capacities and therefore knowledge of economic environment in which businesses are being operated is important for them. This includes the economic system, conditions and policy framework prevailing in the local and world economy.


- Industrial Licensing Policy

- Micro Small and Medium

Enterprises Policy

- National Manufacturing Policy

Service

Infrastructure

III. Economic Condition in India

I. Economic Growth – National

Income and Per Capita

Income

II. Poverty in India

III. Unemployment in India

IV. Inflation

V. Balance of Payments

IV. Financial Environment –

Structure of Indian Financial

System

3. Monetary Policy in India

I. Concept and Meaning of

Monetary Policy

II. Objectives of the Monetary

Policy

III. Impact of Monetary Policy on

Business

IV. Monetary Policy in India

4. Fiscal Policy in India

I. Concept and Meaning of

Fiscal Policy

II. Objectives of the Fiscal Policy

III. Impact of Fiscal Policy on

Business

IV. Fiscal Policy in India

5. Global Economic Environment of

Business

I. Globalization

II. Trends in Global Economy

III. Role of World Trade

Organization

IV. Foreign Trade Policy of India

Changes made in the Syllabus of CA Intermediate (IPC) Paper 8A: Information Technology (proposed) vis-a-vis Paper

7A: Information Technology (existing).

Paper 7A: Information Technology (50 Marks) - Existing

Paper 8A: Information Technology (60 Marks) - Proposed


Reasons for changes

1. Business Process Management & IT: Introduction to various Business processes – Accounting, Finances, Sale, Purchase etc. Business Process Automation – Benefits & Risks, Approach to mapping systems: Entity Diagrams, Data Flow Diagrams, Systems Flow diagrams, Decision Trees/tables, Accounting systems vs. Value chain automation. Information as a business asset, Impact of IT on business processes. Business Risks of failure of IT, Business Process Re-engineering

Chapter 1: BUSINESS PROCESSES MANAGEMENT AND IT

Introduction to Business Processes and related concepts, Various Business processes – Accounting, Sale, Purchase etc.;

Information Processing, Business Process Automation (BPA) - Benefits & Risks, BPA implementation, Business Risks of failure of IT;

Theories of Process Management;

Business Process Management (BPM) and its implementation, Information as a business asset, Impact of IT on business processes, Change Management Process;

Constructing an overview diagram of business processes with an assistance of automated design techniques: Entity Relationship Diagrams and Flowcharts.

Deletion

Data Flow Diagrams,

Systems Flow Diagrams,

Decision Tree and Decision Table

These are the documentation tools used in Software Engineering and are not relevant for CA curriculum.

2. Information Systems and IT Fundamentals: Understand importance of IT in business and relevance to Audit with case studies. Understand working of computers and networks in business process automation from business information perspective. Concepts of

Chapter 2: ACCOUNTING INFORMATION SYSTEMS

Introduction to Information Systems and its components;

Information Systems Development

“Chapter -5 Acquisition, Development and Implementation of Information Systems” from Final Paper 6:

The Information Systems’ concepts and development has already been

Computing (Definition provided by ACM/IEEE and overview of related terminologies). Overview of IS Layers – Applications, DBMS, systems software, hardware, networks & links and people. Overview of Information Systems life cycle and key phases. Computing Technologies & Hardware – Servers, end points, popular computing architectures, emerging computing architectures & delivery models – example: SaaS, Cloud Computing, Mobile computing, etc., Example: Overview of latest devices/technologies – i5, Bluetooth, Tablet, Wi-Fi, Android, Touchpad, iPad, iPod, Laptop, Notebook, Smartphone, Ultra- Mobile PC etc.

Life Cycle (SDLC) and related key phases;

Information Systems and organizational infrastructure;

Define Accounting Information Systems (AIS), its types, role and importance to accountants and business, Interrelationship between business processes and Accounting Information Systems.

Information Systems Control and Audit has been shifted to Intermediate level.

covered at Intermediate level. The relevant Chapter -5 from Final Paper 6: ISCA has been shifted here in order to avoid duplication.

3. Telecommunication and Networks: Fundamentals of telecommunication, Components and functions of Telecommunication Systems. Data networks – types of architecture, LAN, WAN, Wireless, private and public networks etc., Overview of computing architectures – centralized, de-centralized, mainframe, client-server, thin-thick client etc. Network Fundamentals – Components, Standards and protocols, Network risks & controls – VPN, Encryption, Secure protocols. Network administration and management – concepts and issues. How information systems are facilitated through telecommunications. How Internet works, Internet architecture, key concepts, risks and controls, e-Commerce and M-commerce technologies

Chapter 5: TELECOMMUNICATION AND NETWORKS

Fundamentals of telecommunication, Components and functions of Telecommunication Systems, Role of telecommunication in Information Systems.

Classification of Telecommunication Networks, Digital Data Transmission, Network Topology etc.;

Network Architecture, Standards and protocols;

Network risks, Controls and Security;

Network administration and management – Concepts and Issues

- -

4. Business Information Systems : Information Systems and their role in businesses, IT as a business enabler & driver – ERP, Core Banking System, CRM, SCM, HRMS, Payment Mechanisms. The relationship between organizations, information systems and business processes, Accounting Information Systems and linkages to Operational systems, Business Reporting, MIS & IT. Organization Roles & responsibilities and table or authorities, importance of access controls, privilege controls. Specialized systems - MIS, DSS, Business Intelligence, Expert Systems, Artificial Intelligence, Knowledge Management systems etc.

Chapter 3: INFORMATION SYSTEMS’S DOMAIN

Applying Information Systems to business, Organization and Systems, Domain of Business Information Systems, Information Systems and their role in businesses; IT and Internet as a business enabler & driver;

Classification of Information Systems, Concepts of Business Intelligence, Specialized Business Information Systems

Business Reporting and fundamentals of XBRL (eXtensible Business Reporting Language).

Addition of:

Business Reporting and fundamentals of XBRL (eXtensible Business Reporting Language).

Aspiring Chartered Accountants must be well versed with XBRL which is a method of presentation or reporting. XBRL does not attempt to make any changes in the content to be reported. A standard that was developed to improve the way in which financial data is communicated, making it easier to compile and share this data.

5. Business Process Automation through Application software: Business Applications – overview and types, Business Process Automation, relevant controls and information systems. Information Processing & Delivery channels

and their role in Information Systems. Key types of Application Controls and their need. Emerging concepts – Virtualization, Grid Computing, Cloud delivery model.

Chapter 4: INFORMATION TECHNOLOGY RISKS AND CONTROLS

Identifying Information Technology Risks, relevant controls and their need;

Classification of Controls – Management Control Framework and Application Control Framework.

- -

- Chapter 6: EMERGING TECHNOLOGIES AND IT ACT, 2000

Concepts of Computing Technologies - Grid Computing, Mobile Computing, Cloud Computing: overview and architecture;

Emerging technological concepts and latest devices;

Risks, Controls and Assurance in Emerging Technologies;

Overview of e-Commerce and m-Commerce technologies, Payment Methods;

Overview of Specific sections of IT Act, 2000

Addition

“Chapter 8: Emerging Technologies” from Final Paper 6: Information Systems Control and Audit” has been shifted at Intermediate level.

Also the topic “IT Act, 2000” from “Chapter 7 Information Technology Regulatory Issues” of Final Paper 6: Information Systems Control and Audit” has been shifted at Intermediate level.

Cloud Computing is already taught at Intermediate Level under the existing syllabus.

Other computing technologies which are covered under Final Paper 6: ISCA have been shifted here since it has more relevance here. Furthermore, this will bring out better understanding of the Computing Technologies.

Changes made in the Syllabus of CA Intermediate Paper 8 part II: Strategic Management (proposed) vis-a-visPaper 7B:

Strategic Management (existing).

Strategic Management (50 Marks) Strategic Management (40 Marks) Changes (Addition/ Deletion)

Reasons for changes

1. Business Environment

General Environment ─ Demographic, Socio-

cultural, Macro-economic, Legal/political,

Technological, and Global; Competitive

Environment.

The Business Environment, Macro

and Micro Environment with its elements are shifted

from here to the Paper Business and

Commercial Knowledge at

Foundation Level.

2. Business Policy and Strategic Management

Meaning and nature; Strategic management

imperative; Vision, Mission and Objectives;

Strategic levels in organizations.

1. Introduction to StrategicManagement

Business Policy Meaning and Nature of Strategic

management Business Strategy Strategic levels in organizations Strategic Management in

Government and Not-for-profit organization

3. Strategic Analysis

Situational Analysis – SWOT Analysis, TOWS

Matrix, Portfolio Analysis ─ BCG Matrix.

2. Dynamics of Competitive Strategy

Competitive Landscape

Addition:

Competitive Landscape

Nowadays all the businesses faces cut throat competition. Companies have to

Strategic Analysis

Industry and competitive Analysis

Core Competence

Competitive advantage

Internal and External Analysis

SWOT Analysis

Globalization

develop core competencies which would keep them ahead of their competitors.In this chapter the emphasis is on understanding the meaning and importance of core competence and competitive advantage.

2. Business Policy and Strategic Management

Vision, Mission and Objectives.

4. Strategic Planning

Meaning, stages, alternatives, strategy

formulation.

3. Strategy Making Process

Strategic Planning and Decision

Making

Strategic intent

Vision, Mission and Objectives

Strategic Management Process

Strategy Formulation



formulation.

4. Corporate Level Strategies

Corporate Strategy

Nature, scope and concerns of

corporate strategy

Strategic Alternatives at Corporate

Level

Growth

Stability

Expansion

Retrenchment

Mergers

Acquisition

Addition:

Strategic Alliances

Strategic alliancesis introduced as a new topic in this chapter. As there are no geographical and economical boundaries in the business world, strategic alliances plays a pivotal role in the business world.

Strategic Alliances



formulation.

5. Business Level Strategies

Competitive strategies at business level Michael Porter’s Generic Strategies Best-Cost Provider Strategy

5. Formulation of Functional Strategy

Marketing strategy, Financial strategy,

Production strategy, Logistics strategy,

Human resource strategy.

6. Functional Level Strategies

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

6. Strategy Implementation and Control

Organizational structures; Establishing

strategic business units; Establishing profit

centers by business, product or service,

market segment or customer; Leadership and

behavioural challenges.

7. Organisation and StrategicLeadership

Organisation structure Strategic Business Unit Strategic Leadership Strategy supportive culture Entrepreneurship and

intrapreneurship

Addition:

Entrepreneurship and intrapreneurship

Entrepreneurship and intrapreneurship is introduced as a new topic in this chapter. Nowadays, both these topics are popular among the business society. Entrepreneurs and intrapreneur are similar in the passion to see things through to the end and the courage to face failure.

7. Reaching Strategic Edge

Business Process Reengineering, Benchmarking,

Total Quality Management, Six Sigma,

Contemporary Strategic Issues.

8. Strategy Implementation andControl

Strategy Implementation Interrelationships between Strategy

Formulation and Implementation Strategic Change Strategic Control Strategic Audit Business Process Reengineering Benchmarking

Addition:

Strategic Audit

Deletion:

TQM, Six Sigma and Strategy for Internet technology

Strategic Audit is introduced as a new topic in this chapter. Strategic audit is concerned with monitoring and assessing efficacy of various activities associated with strategic planning and strategy execution and taking suitable meansures to improve business operations of the organisation. It is proposed to cover the meaning, scope and methods of Strategic Audit in this topic.

Deleted:

TQM, Six sigma and strategy for internet technology are deleted. To avoid duplication, we have deleted these topics. They are covered in different papers of CA curriculum in Information Technology and Advance Management Accounting.

Changes made in the Syllabus of CA Final Paper 1: Financial Reporting (proposed) vis-a-visFinalPaper 1 :Financial Reporting (existing)

Financial Reporting as per the existing syllabus

Financial Reporting as per the proposed syllabus Changes (Addition/ Deletion/ covered by way of Ind AS or AS)

Reasons for changes

1. Framework for Preparation and Presentation ofFinancial Statements in accordance with IndianAccounting Standards.

Addition Framework sets out the concepts that underlie the preparation and presentation of financial statements for external users. It assist preparers of financial statements in applying Ind AS and in dealing with topics that have yet to form the subject of Ind AS. Ind AS has been notified by the Government of India and made mandatory from 1st April, 2016 by certain class of companies. Preparers may face problems while following the same in the preparation of their financial statements. Knowledge of this framework will guide them to deal with different typical industry specific situations. Therefore, it has become imperative to teach the framework to CA students so that they are also able to appreciate that in situations where Ind AS is

silent, one may refer the Framework for logical interpretation.

1. Accounting Standards (ASs)and Guidance Notes on variousaccounting aspects issued bythe ICAI and their applications.

2. Application of Indian Accounting Standards (IndASs) and Existing Accounting Standards on various accounting aspects with reference to-

• Separate financial statements• Consolidated financial statements• Disclosures• Financial instruments• Special transactions• Understanding of Industry Specific

Accounting.

Addition of Ind AS

Ind AShas been notified by the Government of India and made mandatory from 1st April, 2016 by certain class of companies. Application of Ind AS is expected to grow with time by taking in stride many sectors like Banking, Insurance and NBFCs. Therefore, it has become imperative to teach the same to CA studentsalongwith Existing AS.

3. Application of Guidance Notes issued by ICAIon various accounting aspects.

4. Principles of Integrated Reporting. Addition This is an emerging concept gaining worldwide importance and many countries are in the process of adopting it. It will cover both financial and non-financial aspects. Therefore the same has been included in the syllabus for giving the students an insight of Integrated reporting.

2. Introduction of IndianAccounting Standards (Ind AS);Comparative study of ASs vis-a-vis Ind ASs; Carve outs/ins in

Covered already with Ind AS and AS in

Specific mention of this topic has been removed from the syllabus. However, this topic will be covered in the above proposed topic of

Ind ASs vis-à-vis International Financial Reporting Standards (IFRSs).

the proposed syllabus

Application of Ind AS and AS.

3. Corporate FinancialReporting - Issues and problemswith special reference topublished financial statements.

Deletion This Topics is covered by way of Guidance Note on Schedule III to the Companies Act, which is proposed to be covered at Intermediate Level in Paper 5 : Advanced Accounting

4. Accounting for CorporateRestructuring (including inter-company holdings).

Covered by way of Ind AS or AS

In the existing curriculum, this topic is also covered at Intermediate (IPC) level. However, inter-company holding was not covered there. In the new proposed syllabus, repetition has been avoided and this topic is now shifted at Intermediate level fully. At Final level, this topic will be discussed by way of Ind AS 103 and AS 14.

5. Consolidated Financial Statements of Group Companies • Concept of a Group,

purposes of consolidated financial statements, minority interest, Goodwill, Consolidation procedures – Minority interests, Goodwill, Treatment of pre- acquisition and post-acquisition profit.


Specific mention to this topic has been removed from the syllabus. However, the topic will be covered by way of Ind AS 110 / AS 21

• Consolidation with two ormore subsidiaries,consolidation with foreignsubsidiaries.

• Consolidated profit and lossaccount, balance sheet andcash flow statement.

• Treatment of investment inassociates in consolidatedfinancial statements.

• Treatment of investments injoint ventures in consolidatedfinancial statements.

6. Accounting and reporting offinancial instruments• Meaning, recognition,

derecognition and offset, compound financial instruments

• Measurement of financialinstruments

• Hedge accounting• Disclosures

Covered by way of Ind AS

Specific mention to this topic has been removed from the syllabus. However, the topic will be covered by way of Ind AS 32, 107 and 109.

7. Share based payments• Meaning, Equity settled

transactions, Transactionwith employees and non-employees

Covered by way of Ind AS

In the existing curriculum, this topic (based on Guidance Note) is also covered at Intermediate (IPC) as well as final level. In the new proposed syllabus, repetition has been avoided and this topic is now

• Determination of fair value ofequity instruments

• Vesting conditions• Modification, cancellation

and settlement• Disclosures

shifted at Intermediate level.

However, Ind AS 102 deals with Share based payment which is covered here in the proposed syllabus.

8. Financial Reporting by

• Mutual funds, Deletion The above topic in relation to mutual fund, is proposed to be shifted at Final level in the paper of Strategic Financial Management

• Non-banking finance companies,

Deletion The syllabus of Paper 1: Financial Reporting at Final level has been developed on the basis of Ind ASs. Since Ind AS suffice the 100 marks coverage of the paper at Final level, this topic has been shifted to IIPC P-5 Advanced Accounting.

• Merchant bankers, Deletion The above topic in relation to Merchant bankers is proposed to be shifted at Final level in the paper of Strategic Financial Management

• Stock and commoditymarket intermediaries.

Deletion The above topic in relation to Stock and commodity market intermediaries is proposed to be shifted at Final level in the paper of Strategic Financial Management

9. Valuation

(a) Concept of Valuation Deletion Shifted to Paper 5 Advanced Accounting alongwith‘Valuation of Goodwill’.

(b) Valuation of TangibleFixed Assets


Specific mention to this topic has been removed from the syllabus. However, the topic will be covered by way of Ind AS / AS.

(c) Valuation of Intangiblesincluding brand valuation andvaluation of goodwill


Partial Deletion

Specific mention to this topic has been removed from the syllabus. However, the topic will be covered by way of Ind AS / AS. The syllabus of Paper 1: Financial Reporting at Final level has been developed on the basis of Ind ASs. Since Ind AS suffice the 100 marks coverage of the paper at Final level, many topics have been shifted from Final to IIPC. The topic of valuation of goodwill has been shifted there because the concept of valuation of goodwill is applied in many topics covered in the syllabus of that paper for example amalgamation.

(d) Valuation of liabilities Covered by way of Ind AS or AS

Specific mention to this topic has been removed from the syllabus. However, the topic will be covered by way of Ind AS / AS.

(e) Valuation of Shares Deletion The above topics are proposed to be shifted at Final level in the paper of Strategic Financial Management as it deals with valuation rather than accounting/reporting.

(f) Valuation of Business Deletion The above topics are proposed to be shifted at Final level in the paper of Strategic Financial Management as it deals with valuation rather than accounting/reporting.

10. Developments in Financial Reporting(a) Value Added Statement Deletion In the present scenario, no entity is

reporting on value added statement and human resource. Moreover, the concept of integrated reporting has been included in the proposed curriculum which will cover both financial and non-financial reporting aspects.

(b) Economic Value Added,Market Value Added,Shareholders’ Value Added

Deletion The topic on EVA, MVA and SVA are more relevant for management hence proposed to be shifted at Final level in the paper of Strategic Financial Management.

(c) Human Resource Reporting

Deletion In the present scenario, no entity is reporting on value added statement and human resource. Moreover, the concept of integrated reporting has been included in the proposed

curriculum which will cover both financial and non-financial reporting aspects.

Note– If either old Accounting Standards (ASs), Guidance Notes (GNs), Announcements and Limited Revisions to ASs are withdrawn or new ASs, GNs, Announcements and Limited Revisions to AS are issued by the Institute of Chartered Accountants of India in place of existing ASs, GNs, Announcements and Limited Revisions to AS, the syllabus will accordingly exclude / include such new developments in the place of the existing ones with effect from the date to be notified by the Institute.

Note – If either a new Indian Accounting Standard (Ind AS) or Accounting Standard (AS), Announcements and Limited Revisions to Ind AS / AS are issued or the earlier one are withdrawn or new Ind AS / AS, Announcements and Limited Revisions to Ind AS / AS are notiifed in place of existing Ind AS / AS, Announcements and Limited Revisions to Ind AS / 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. The list of Guidance Notes in Accounting applicable in this paper for a particular exam will be issued separately before the respective examination.

Partial Addition

List of Guidance Notes has been added here since few Guidance Notes are proposed to be covered here.

Annexure Guidance Notes on Accounting Aspects applicable at Final level 1. Guidance Note on Accounting Treatment for

Excise Duty.2. Guidance Note on Accounting Treatment for

MODVAT/CENVAT.3. Guidance Note on Accounting for Credit

Available in respect of Minimum Alternate Taxunder the Income Tax Act, 1961.

4. Guidance Note on the Revised Schedule VI tothe Companies Act, 1956 (Now Schedule III tothe Companies Act, 2013).

5. Guidance Note on Accounting for Derivativecontracts(issued 2015)

6. Guidance Note on Accounting for Expenditureon Corporate Social Responsibility Activities(Issued May 15, 2015)

7. Guidance Note on Accounting for Oil and GasProducing Activities (revised 2013)

8. Guidance Note on Accounting Treatment forExcise Duty

9. Guidance Note on Accounting for State-levelValue Added Tax

10. Guidance Note on Accounting for Real EstateTransactions (Revised 2012) and GuidanceNote on Accounting for Real EstateTransactions (for entities to whom Ind AS isapplicable) issued May, 2016

11. Guidance Note on Accounting for RateRegulated Activities

12. Guidance Note on Accounting for Self-generated Certified Emission Reductions(CERs) (Issued 2012)

13. Guidance Note on Accounting by Dot-ComCompanies

Changes made in the Syllabus of CA Final Paper 2: Strategic Financial Management (proposed)vis-a-visPaper 2: Strategic Financial Management (existing).

Strategic Financial Management (100 Marks) Strategic Financial Management (100 Marks) Changes (Addition/ Deletion)

Reasons for changes

1. Financial Policy and Corporate Strategy

• Strategic decision making framework

• Interface of Financial Policy and strategicmanagement

• Balancing financial goals vis-à-vissustainable growth.

1. Financial Policy and Corporate Strategy

• Strategic decision making framework

• Interface of Financial Policy and strategicmanagement

• Balancing financial goals vis-à-vissustainable growth.

2. Risk Management

• Identification of types of Risk faced by anorganisation

• Evaluation of Financial Risks

• Value at Risk (VAR)

• Evaluation of appropriate method for theidentification and management of financialrisk.

Addition Although Financial Risk is covered in earlier Syllabus also yet Risk Management nowhere covered exclusively. In today’s scenario while taking decision it is one of important area.

2. Project Planning and Capital Budgeting

• Feasibility study

• Cash flow Projections – Impact oftaxation, depreciation, inflation andworking capital

3. Advanced Capital Budgeting Decisions

• Allowing inflation in Capital BudgetingDecision

• Adjustment of Risk and Uncertainty inCapital Budgeting Decision

• Capital Budgeting Decisions - CertaintyEquivalent approach, Evaluation of RiskyInvestment Proposals, Risk and Returnanalysis, Simulation and decision treeanalysis, Sensitivity analysis, CapitalRationing, Adjusted Net Present Value,Replacement decisions, Application ofReal Options in capital budgeting, Impactof inflation on capital budgeting decisions

• Preparation of Project Report

• Social cost benefit analysis.

(a) Probability Analysis

(b) Certainty Equivalent Method

(c) Risk Adjusted Discount Rate

(d) Monte Carlo Simulation

(e) Decision Tree Analysis

(f) Scenario Analysis

(g) Sensitivity Analysis

• Adjusted Present Value

• Specific Capital Budgeting Decisions(Replacement of Assets and CapitalRationing)

3. Leasing decision including cross borderleasing

6. Lease Financing

• Concept and Classification

• Significance and Limitations of LeaseFinancing

• Financial Evaluation of Leasing Decision

4. Dividend Decisions

Dividend theories, Determinants of dividend policies.

Shifted to Paper 7: Financial Management & Business Economic Environment at Intermediate Level

More suitable along with other functions of Financial Management covered in the paper of Financial Management at Intermediate Level.

5. (a) Indian CapitalMarket including role ofvarious primary and secondary market

10. Interest Rate Risk Management

• Interest Rate Risk

Except Interest Rate Risk Management remaining portion

Separate Paper earmarked for this topic.

institutions (b) Capital Market InstrumentsFinancial derivatives – stock futures, stockoptions, index futures, index options

Option valuation techniques : Binomial model, Black Scholes Option Pricing Model,

Greeks – Delta, Gamma, Theta, Rho and Vega

Pricing of Futures – Cost of carry model

Imbedded derivatives

(c) Commodity derivatives

(d) OTC derivatives -Swaps, Swaptions,Forward Rate Agreements (FRAs),Caps, Floors and Collors.

• Hedging Interest Rate Risk

(a) Traditional Methods

(b) Modern Methods including Interest Rate Derivatives

Shifted to Part I of Paper 6 : Financial Services and Capital Markets & Information Systems Control and Audit (Final Level)

6. Security Analysis

• Fundamental analysis - Economicanalysis, Industry analysis and CompanyAnalysis

• Bond valuation, Price Yield relationship,Bond Price forecasting – application ofduration and convexity, Yield curvestrategies

• Technical Analysis – market cycle modeland basic trend identification, differenttypes of charting, support and resistance,price patterns, moving averages,Bollinger Bands, momentum analysis.

4. Security Analysis

• Fundamental Analysis

• Technical Analysis

(a) Meaning(b) Assumptions(c) Theories and Principles(d) Charting Techniques(e) Efficient Market Hypothesis (EMH)

Analysis

5. Security Valuation

• Theory of Valuation

• Return Concepts

To avoid duplication deleted from Paper 1- Financial Reporting (Final Level)

• Equity Risk Premium

• Required Return on Equity

• Discount Rate Selection in Relation toCash Flows

• Approaches to Valuation of Equity Shares

• Valuation of Preference Shares

• Valuation of Bond

• Valuation of Alternative Investments

7. Portfolio Theory and Asset Pricing

• Efficient Market Theory – Random walktheory ; Markowitz model of risk returnoptimization

• Capital Asset Pricing Model (CAPM)

• Arbitrage Pricing Theory (APT)

• Sharpe Index Model

• Portfolio Management - Formulation,Monitoring and Evaluation

• Equity Style Management

• Principles and Management of HedgeFunds

• International Portfolio Management.

7. Portfolio Management

• Portfolio Analysis

• Portfolio Selection

• Capital Market Theory

• Portfolio Revision

• Portfolio Evaluation

• Asset Allocation

• Fixed Income Portfolio

• Risk Analysis of Investment in DistressedSecurities

• Alternative Investment Strategies in contextof Portfolio Management

8. Financial Servicesin India• Investment Banking

• Retail Banking

Shifted to Part I of Paper 6 : Financial Services and Capital Markets & Information Systems


• On Line Share Trading

• Depository Service.

Control and Audit (Final Level)

9. (a) Mutual Funds: Regulatory framework,

formulation, monitoring and evaluation of various schemes of Mutual funds, Money market mutual funds.

(b) Exchange Traded Funds.

Shifted to Part I of Paper 6 : Financial Services and Capital Markets & Information Systems Control and Audit (Final Level)


10. Money Market operations

Shifted to Part I of

Paper 6 : Financial Services and Capital Markets & Information Systems Control and Audit (Final Level)


11. (a) Foreign Direct Investment, Foreign Institutional Investment.

(b) International Financial Management

• Raising of capital abroad - American Depository Receipts, Global Depository Receipts, External Commercial Borrowings and Foreign Currency Convertible Bonds

• International Capital Budgeting

• International Working Capital Management.

9. International Financial Management • International Capital Budgeting

• International Working Capital Management

(a) Multinational Cash Management Objectives of Effective Cash

Management Optimization of Cash Flows/

Needs Investment of Surplus Cash

(b) Multinational Receivable Management (c) Multinational Inventory Management

12. Foreign Exchange Exposure and Risk Management • Exchange rate determination, Exchange

rate forecasting

• Foreign currency market

• Foreign exchange derivatives – Forward, futures, options and swaps

• Management of transaction, translation and economic exposures

• Hedging currency risk.

8. Foreign Exchange Exposure and Risk Management

• Exchange rate determination

• Foreign currency market

• Management of transaction, translation and economic exposures

• Hedging currency risk

• Foreign exchange derivatives – Forward, futures, options and swaps

13. Mergers, Acquisitions and Restructuring

Meaning of mergers and acquisition, categories, purposes

Process of mergers and acquisition – Identification and valuation of the target, acquisition through negotiation, due diligence, post – merger integration

Legal and regulatory requirements

Merger and Acquisition agreement

Reverse merger

Potential adverse competitive effects of mergers

Corporate Takeovers: Motivations, Co-insurance effect, Cross-border takeovers, Forms of takeovers, Takeover defenses

Going Private and Other Control Transactions: Leveraged Buyouts (LBOs), Management Buyouts

11. Corporate Valuation and Reorganization • Conceptual Framework of Valuation

• Approaches/ Methods of Valuation

(a) Assets Based Valuation Model

(b) Earning Based Models

(c) Cash Flow Based Models

(d) Measuring Cost of Equity

Capital Asset Pricing Model (CAPM)

Arbitrage Pricing Theory

Estimating Beta of an unlisted company

(e) Relative Valuation

Steps involved in Relative Valuation

Additions: Economic

Value Added (EVA)

Market Value Added (MVA)

Shareholder Value Analysis (SVA)

To avoid duplication deleted from Paper 1- Financial Reporting (Final Level)

(MBOs), Spin Offs and Asset Divestitures

Corporate Restructuring : Refinancing and rescue financing, reorganizations of debtors and creditors, Sale of assets, targeted stock offerings, downsizing and layoff programmes, negotiated wage give-backs, employee buyouts.

Equity Valuation Multiples

Enterprise Valuation Multiple

(f) Other Approaches to Value Measurement

Economic Value Added (EVA)

Market Value Added (MVA)

Shareholder Value Analysis (SVA)

(g) Arriving at Fair Value

(h) Cross Border Mergers

• Corporate Restructuring

(a) Conceptual Framework

(b) Rationale

(c) Forms

(d) Mergers and Acquisitions

Financial Framework

Takeover Defensive Tactics

Reverse Merger

(e) Divestitures

Partial Sell off

Demerger

Equity Carve outs

(f) Ownership Restructuring

Going Private

Management/ Leveraged Buyouts

12. Islamic Finance (a) Major difference between Islamic

Finance and other forms of Finance

(b) Concept of Riba

(c) Major Islamic Financial Instruments

Addition Need of hour for scope of jobs for Indian CAs in Gulf Countries and here it covers only the basic understanding of above sub topics.

Changes made in the Syllabus of CA Final Paper 3: Advanced Auditing and Professional Ethics (proposed) vis-a-vis Paper 3: Advanced Auditing and Professional Ethics (existing).

Advanced Auditing and Professional Ethics (100 Marks)

Advanced Auditing and Professional Ethics (100 Marks)


Reasons for changes

1. Auditing Standards, Statements and Guidance Notes

Auditing and Assurance Standards (AASs); Statements and Guidance Notes on Auditing issued by the ICAI; Significant differences between Auditing and Assurance Standards and International Standards on Auditing.

1. Auditing Standards, Statements and Guidance Notes

Engagement & Quality Control Standards, Statements and Guidance Notes on Auditing issued by the ICAI; Significant differences between Engagement & Quality Control Standards and International Standards.

2. Audit Strategy, Planning and Programming Planning the flow of audit work; audit strategy,

planning programme and importance of supervision: review of audit notes and working papers; drafting of reports; principal’s ultimate responsibility; extent of delegation; control over quality of audit work; reliance on the work of other auditor, internal auditor or an expert.

Deletion Audit strategy, planning and programming

Covered at Intermediate (IPC) Level Paper 6 Auditing and Assurance.

3. Risk Assessment and Internal Control Evaluation of internal control procedures;

techniques including questionnaire, flowchart; internal audit and external audit, coordination between the two.

2. Risk Assessment and Internal Control Evaluation of internal control procedures;

Components of internal controls; Techniques including questionnaire, check list, flowchart; Internal control and risk assessment; Risk-based audit- audit risk analysis, general steps;

Addition COSO framework

COSO Framework is related to reporting of internal control, financial control, compliances, etc. It facilitates organization to develop cost-

Internal audit; Reporting on internal control weaknesses; Salient features of Sarbanes Oxley Act with special reference to reporting on Internal Control; COSO Framework.

effective system of internal control to achieve business objectives and improve performance. Keeping in view the important provisions of COSO Framework in relation to reporting on Internal Control, the topic has been proposed at this level.

4. Audit under computerized information system (CIS) environment

Special aspects of CIS Audit Environment, need for review of internal control especially procedure controls and facility controls. Approach to audit in CIS Environment, use of computers for internal and management audit purposes: audit tools, test packs, computerized audit programmes; Special Aspects in Audit of E-Commerce Transaction.

Deletion Audit under computerized information system (CIS) environment

Covered in Paper 6 (Part II): Information Systems Control and Audit at Final level.

5. Special audit techniques (a) Selective verification; statistical sampling:

Special audit procedures; physical verification of assets, direct confirmation of debtors and creditors

(b) Analytical review procedures (c) Risk-based auditing.

Deletion Special audit techniques

Risk based auditing is shifted to Specific Chapter Risk Assessment and Internal Control and Remaining topics are covered in Standards on Auditing.

6. Audit of limited companies Relevant Provisions under the Companies Act,

2013 relating to Audit and Auditors and Rules made thereunder; Audit of branches: joint audits; Dividends and divisible profits - financial, legal, and policy considerations.

7. Rights, duties, and liabilities of auditors; third party liability.

3. Audit of Limited Companies Application of Relevant Provisions under the

Companies Act, 2013 relating to Audit and Auditors and Rules made thereunder; Powers/rights, duties of auditors; Branch Audit significance of true and fair view; Dividends and divisible profits- financial, legal, and policy considerations; depreciation; Special features of audit of Limited Liability Partnerships (LLPs)- Eligibility for audit, appointment of auditor, remuneration, etc.

4. Liabilities of Auditors Professional negligence; Civil liabilities; Criminal

liabilities; Liabilities under Income Tax Act.

Addition Special features of audit of Limited Liability Partnerships (LLPs)- eligibility for audit, appointment of auditor, remuneration, etc. Deletion - Joint Audit topic

Consequent to amendment in Companies Act, LLPs have been allowed to be operative under Companies Act and take the advantage of feature of limited liability. Joint Audit is already covered in SA 299.

8. Audit reports; Qualifications, notes on accounts, distinction between notes and qualifications, detailed observations by the statutory auditor to the management vis-a-vis obligations of reporting to the members.

5. Audit Reports Basic elements of auditor’s report; Types of

opinion; Audit report under the Companies Act, 2013; Reporting under CARO; Notes on accounts; Distinction between notes and qualifications; Distinction between audit reports and certificates; Audit reports and certificates for special purpose engagements; Detailed observations by the statutory auditor to the management vis-a-vis obligations of reporting to the members.

9. Audit Committee and Corporate Governance.

6. Audit Committee and Corporate Governance Audit committee under clause 49 of the listing

agreement; Audit committee under the Companies Act, 2013; Role of auditor in Audit Committee and Certification of Compliance of

Corporate Governance; Disclosure requirements; Report on corporate governance.

10. Provisions under the Companies Act, 2013 in respect of Accounts of Companies and Rules made thereunder. Audit of Consolidated Financial Statements, Audit Reports and Certificates for Special Purpose engagements; Certificates under the Payment of Bonus Act, import/export control authorities, etc.; Specific services to non-audit clients; Certificate on Corporate Governance.

7. Audit of Consolidated Financial Statements Provisions under the Companies Act, 2013 in

respect of Accounts of Companies and Rules made thereunder; Audit of Consolidated Financial Statements- responsibility of parent company, auditor of the consolidated financial statements; audit considerations- permanent consolidation, current period consolidation; reporting.

11. Special features of audit of banks, insurance companies, co-operative societies and non-banking financial companies.

8. Special features of audit of banks, insurance companies, co-operative societies and non-banking financial companies.

12. Audit under Fiscal Laws, viz, Direct and Indirect Tax Laws.

9. Audit under Fiscal Laws Audit under Fiscal Laws, viz, Direct and Indirect

Tax Laws.

13. Cost audit

10. Cost Audit Types, advantages of cost audit; Cost audit

under the Companies Act, 2013.

14. Special audit assignments like audit of bank borrowers, audit of stock and commodity exchange intermediaries and depositories; inspection of special entities like banks, financial institutions, mutual funds, stock brokers.

11. Special Audit Assignments Special audit assignments like audit of members

of stock exchange, mutual funds, depositories, bank borrowers; Environmental audit; Energy audit.

15. Special features in audit of public sector companies. Directions of Comptroller and

12. Audit of Public Sector Undertakings Audit of government companies;

Auditor General of India to statutory auditors; Concepts of propriety and efficiency audit.

Comprehensive audit; Concept of propriety audit; Performance audit.

16. Internal audit, management and operational audit Nature and purpose, organisation, audit programme, behavioural problems; Internal Audit Standards issued by the ICAI; Specific areas of management and operational audit involving review of internal control, purchasing operations, manufacturing operations, selling and distribution, personnel policies, systems and procedures. Aspects relating to concurrent audit.

13. Internal Audit, Management and Operational Audit

Provisions of internal audit as per Companies Act, 2013; Scope of internal auditing; Relationship between internal and external auditor; Internal Audit Standards issued by the ICAI; Management audit and Operational audit.

17. Investigation and Due Diligence.

14. Investigation and Due Diligence Audit versus Investigation; Steps for

investigation; Types of investigation; procedure, powers, etc. of investigator; Forensic audit- meaning, difference between statutory audit and forensic audit, category for forensic engagements, collection of evidences etc; due diligence.

Addition Forensic audit- meaning, introduction, examples etc.

Keeping in view the incidence of financial fraudulent activities and also increased financial frauds by usage of internet, this being criminal activity, requires specialized persons to investigate and prevent the occurrence of such activities. Having regard to above, the need of teaching forensic audit at the final level is being proposed.

18. Concept of peer review 15. Concept of peer review

19. Salient features of Sarbanes – Oxley Act, 2002

with special reference to reporting on internal control.

Covered in specific Chapter Risk Assessment and Internal Control

20. Professional Ethics Code of Ethics with special reference to the

relevant provisions of The Chartered Accountants Act, 1949 and the Regulations thereunder.

16. Professional Ethics Code of Ethics with special reference to the

relevant provisions of the Chartered Accountants Act, 1949 and the Regulations thereunder.

Note: (i) 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.

(ii) 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.

Note: (i) 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.

(ii) 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.

Changes made in the Syllabus of CA Final paper 4: Corporate and other Economic Laws (proposed) vis-a-vis Paper 4: Corporate and Allied Laws (existing).

Corporate and Allied Laws (100 Marks) Corporate and Other Economic Laws (100 Marks)


Reasons for changes

Section A: Company Law (70 Marks) Section A: Company Law (70 Marks) 1. The Companies Act, 2013 and Rules framed thereunder in its entirety with specific reference to

(a) Declaration and payment of Dividend (b) Accounts and audit (c) Appointment and Qualifications of Directors (d) Appointment and remuneration of Managerial Personnel (e) Meetings of Board and its powers (f) Inspection, inquiry and Investigation (g) Compromises, Arrangements and Amalgamations (h) Prevention of Oppression and Mismanagement (i) Revival and Rehabilitation of Sick Companies (j) Winding Up (k) Producer Companies (l) Companies incorporated outside India

The Companies Act, 2013 and Rules framed thereunder in its entirety with specific reference to section 149 onwards:

(a) Appointment and Qualifications of Directors (b) Appointment and remuneration of Managerial Personnel (c) Meetings of Board and its powers (d) Inspection, inquiry and Investigation (e) Compromises, Arrangements and Amalgamations (f) Prevention of Oppression and Mismanagement (g) Revival and Rehabilitation of Sick Companies (h) Winding Up (i) Producer Companies

Chapter VIII and Chapter IX and X i.e. Declaration and payment of dividend and Account and Audit respectively are shifted to Audit Paper

(m) Offences and Penalties (n) E-governance (o) National Company Law Tribunal and

Appellate Tribunal (p) Special Courts (q) Miscellaneous Provisions

2. Corporate Secretarial Practice–Drafting of Resolution, Minutes, Notices and Reports

(j) Companies incorporated outside India (k) Offences and Penalties (l) E-governance (m) National Company Law Tribunal and Appellate Tribunal (n) Special Courts (o) Miscellaneous Provisions

2. Corporate Secretarial Practice–Drafting of Resolution, Minutes, Notices and Reports

SECTION B: ALLIED LAWS (30 MARKS)

SECTION B: OTHER ECONOMIC LAWS (30 MARKS)

An overview of the following laws –

The Securities and Exchange Board of India Act, 1992, Rules, Regulations and Guidelines issued thereunder.

- Shifted to Paper 6, part I: Financial services and capital markets

Securities Contracts (Regulation) Act, 1956

- Shifted to Paper 6, part I: Financial services and capital markets

The Foreign Exchange Management Act, 1999

The Foreign Exchange Management Act, 1999- Overview: Introduction, broad structure of FEMA, Definition, Regulation and Management of Foreign Exchange, Contraventions and Penalties in brief,

-

miscellaneous provisions The Competition Act, 2002

The Competition Act, 2002- Overview: Introduction, Competition Policy and Law, Competition Act, 2002 and further amendments and Definitions.

-

The Banking Regulation Act, 1949, The Insurance Act, 1938, The Insurance Regulatory and Development Authority Act, 1999, The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002

The Banking Regulation Act, 1949- Overview: Introduction, Business of banking companies, Reserve fund, restriction on loan and advances, Audit and different provisions The Insurance Act, 1938- Overview: Important definitions and other provisions related to Insurance The Insurance Regulatory and Development Authority Act, 1999- Overview - Important definitions, duties, powers and functions of authority, finance, accounts and audit and other matters. The Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002- Overview: Important Definitions, Regulation of Securitisation and Reconstruction of Financial Assets of Banks and Financial Institutions, Enforcement of Security Interest, Offences and Penalties, Miscellaneous Matters The Reserve Bank of India Act, 1934- Overview: Chapter III-C of the Act

The Reserve Bank of India Act, 1934- Overview: Chapter III-C of the Act

RBI regulates the issue of Bank Notes and keeping of reserves with a view to securing monetary stability in India and generally to operate the currency and credit system of the country to its advantage. Organisation focuses on supervision of financial institutions, consolidated accounting, legal issues in bank frauds, divergence in assessments of non-performing assets and supervisory rating model for banks. RBI governs the many Acts- The RBI Act, 1934, Banking Regulation Act, 1949, Foreign Exchange Management Act, 1999, Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 Etc.

Knowledge of these laws is the requirement of the time.

The Prevention of Money Laundering Act, 2002 The Prevention of Money Laundering Act, 2002- Advanced portion: Definitions, Punishment for the Offence of Money laundering, Obligation of Banking Companies, Financial Institutions and Intermediaries or a person carrying on a designated business or profession, Appellate Tribunal, Special Court, Procedure for Attachment and Confiscation of Property and Recovery of fines and penalties.

Advance Portion of the PMLA, 2002 will be covered at this level as the basic have been covered in the Intermediate (IPC)

Interpretation of Statutes, Deeds and Documents.

- Deleted and shifted to Intermediate (IPC), Paper 2: Corporate and other laws (Proposed)

The Intellectual Property Rights- Trade mark and Patent Rights- Overview: covering trade mark and patent rights, Trade Mark: Important definitions, procedure and effect of registration and other provisions Patents Rights: Preliminary, Inventions not patentable, grant of Patents and rights conferred thereby and other provisions

New Act added Intellectual property rights are the rights given to persons over the creations of their minds. They usually give the creator an exclusive right over the use of his/her creation for a certain period of time. IP is protected in law by which people enable to earn recognition or financial benefit from what they invent or create. By

striking the right balance between the interests of innovators and the wider public interest, the IP system aims to foster an environment in which creativity and innovation can flourish.

Foreign Contribution Regulation Act, 2010- Overview: Definitions, Regulation of Foreign contribution and Miscellaneous provisions

New Act added This is an Act to regulate the acceptance and utilisation of foreign contribution or foreign hospitality by certain individuals or associations or companies and to prohibit acceptance and utilisation of foreign contribution or foreign hospitality for any activities detrimental to the national interest and for matters connected therewith or incidental thereto.

Legislative framework on listing agreements- Clause 35 and 41 of the listing agreements required for the working of the listing companies

New Topic added Legislative framework for compliance of the Listing Agreement requires a company to follow clause 35, 41, 49, along with the other compliance requirements for the working of the listing companies.

General Clauses Act, 1897- Overview: Important definitions and Applicability, Commencement, termination and computation of time, Powers conferred to be exercisable from time to time, Power to appoint include power to suspend or dismiss, Constructions of Notification, etc, issued under enactments, Power to issue, to include power to add to, amend, vary or rescind notifications, orders, rules, or bye-laws and other provisions.

New Act added This Act ensures the language of statutory enactments and provides for uniformity of expression where there is identity of subject matters.

*The Bankruptcy and Insolvency Act, 2015-Overview: Preliminary, Corporate insolvency resolution process, Liquidation process and other provisions

New Act added The Code creates a framework for resolving insolvency in India. It will apply to companies, partnerships, limited liability partnerships, individuals and any other body specified by the central government.

**The Arbitration and Conciliation Act, 1996-Overview: General Provisions, Arbitration agreement, Tribunal, Conciliation

New Act added An Act to consolidate and amend the law relating to domestic arbitration, international commercial arbitration and enforcement of foreign arbitral awards as also to define the law relating to conciliation and for matters connected therewith or incidental thereto.

**The Societies Registration Act, 1860- Overview: Formation of society by Memorandum of association and registration and other related provisions

New Act added An Act for the Registration of Welfare, Literary, Scientific and Charitable Societies. Whereas it is expedient that provision should be made for improving the legal condition of societies established for the promotion of literature, science, or the fine arts, or for the diffusion of useful knowledge, the diffusion of political education or for charitable purposes.

**The Indian Trust Act, 1882- Overview: Creation of Trusts, Duties and Liabilities, Certain obligations in the nature of trusts

New Act added An Act to define and amend the law relating to Private Trusts and Trustees

**The Co-operative Societies Act, 1912- Overview: Preliminary, Registration, Duties of Registered societies, Privileges and Miscellaneous provisions

New Act added An Act to amend the Law relating to Co-operative Societies. Whereas it is expedient further to facilitate the formation of Co-operative Societies for the promotion of thrift and self-help among agriculturists, artisans and persons of limited means and for that purpose to amend the law relating to Co-operative Societies.

*yet to receive the assent of the president of India

** to be discussed

Note 1: 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.

Note 2: 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 dates 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.

Changes made in the Syllabus of CA Final Paper 5: Advanced Management Accounting (Proposed Name – Strategic Management Accounting) vis-a-visPaper 5: Advanced Management Accounting (Existing).

Advanced Management Accounting (100 Marks)

Strategic Management Accounting (100 Marks)


Reasons for changes

1. Cost Management (a) Developments in the Business

Environment; Just in Time; Manufacturing Resources Planning; (MRP); Automated Manufacturing; Synchronous Manufacturing and Back Flush Systems to reflect the importance of accurate bills of material and routings; World Class Manufacturing; Total Quality Management.

(b) Activity Based Approaches to management and cost analysis

(c) Analysis of Common Costs in manufacturing and service industry

(d) Techniques for Profit Improvement, Cost Reduction, and Value Analysis

(e) Throughput Accounting (f) Target Costing; Cost

Ascertainment and Pricing of Products and Services

(g) Life Cycle Costing

Strategic Cost Management Introduction to Strategic Cost Management 1) Concept of Strategic Cost Management 2) Traditional Cost Management Vs

Strategic Cost Management ---------------------------------------------------------- Modern Business Environment 1) Introduction/ Characteristics of the

Modern Business Environment 2) Cost of Quality & Total Quality

Management 3) Throughput Accounting and Theory of

Constraints 4) Supply Chain Management (SCM) 5) Gain Sharing Arrangements 6) Outsourcing ---------------------------------------------------------- Lean System and Innovation 1) Introduction to Lean System

(a) Just-in-Time (JIT) (b) Kaizen Costing (c) 5 Ss

Additions Concept of Strategic Cost

Management Introduction/ Characteristics

of theModern Business Environment Introduction to Lean

System ------------------------------------------ Deletions Manufacturing Resources

Planning (MRP) Automated Manufacturing Synchronous Manufacturing Back Flush Systems to

reflect the importance of accurate bills of material and routings World Class Manufacturing ------------------------------------------ Shifted (Intermediate Paper-3) Activity Based Approaches to

Management and Cost Analysis(Basic Concepts)

------------------------------------------

Reason for Additions Strategic Cost Management-

This topic sets the framework for Strategic Management Accounting. It discusses traditional management accounting and the key changes leading to the development of strategic management accounting. Modern Business Environment

is very different from the traditional production method. In this environment traditional costing methods becoming less relevant. In this topic we explore how the modern production system has changed/ how costing has adapted this/ created new ways to calculate a product's production cost? Lean Manufacturing is leading

manufacturing paradigm applied in many sectors of the Indian Economy, where improving product quality,

(h) Shut Down and Divestment.

(d) Total Productive Maintenance (TPM)

(e) Cellular Manufacturing/ One-Piece Flow Production Systems

(f) Six Sigma (SS) (g) Introduction to Process Innovation

and Business Process Re-engineering (BPR)

---------------------------------------------------------- Cost and Management Accounting Techniques 1) Target Costing 2) Value Analysis/ Value Engineering 3) Life Cycle Costing

reducing production cost, and being "first to market” and quick to respond to customer needs are critical to competitiveness and success.

------------------------------------- Reason for Deletions These topics are part of

‘Production Management Strategies’.

2. Cost Volume Profit Analysis (a) Relevant Cost (b) Product Sales Pricing and Mix (c) Limiting Factors (d) Multiple Scarce Resource

Problems (e) Decisions about Alternatives

such as Make or Buy, Selection of Products, etc.

-------------------------------------------------------- 3. Pricing Decisions

(a) Pricing of a Finished Product (b) Theory of Price (c) Pricing Policy

Strategic Decision Making Decision Making using Cost Concepts and CVP Analysis 1) Decision Based on Relevant Costing

Principles 2) Decision Making Based on Activity

Based Costing 3) Qualitative and Long Term Aspects of

Short Term Decisions 4) Other Short Term/ Long Term Decisions ---------------------------------------------------------- Pricing Strategies / Decisions 1) Theory & Principles of Product Pricing 2) Pricing – New Product, Finished

Additions Qualitative and Long Term

Aspects of Short Term Decisions. (Not Specifically Covered Earlier)

Reason for Additions In some decision-making

situations, qualitative aspects are more important than immediate financial benefit from decision. They will vary with different business circumstances and are those factors relevant to a decision that are difficult or impossible in terms of money. For an organisation faced with a decision, qualitative factors may include: The state of economy, availability of cash, employee

(d) Principles of Product Pricing (e) New Product Pricing (f) Pricing Strategies (g) Pricing of Service (h) Pareto Analysis

Products & Pricing of Services 3) Sensitivity Analysis in Pricing Decisions 4) Pricing Decision under Special

Circumstances 5) Pricing Strategies

morale, commitments with different stake holders, effect of a decision on long-term profitability, effect of a decision on company's public image and the reaction of customers etc.

4. Budgets and Budgetary Control The Budget Manual, Preparation and Monitoring Procedures, Budget Variances, Flexible Budgets, Preparation of Functional Budget for Operating and Non-Operating Functions, Cash Budgets, Capital Expenditure Budget, Master Budget, Principal Budget Factors. ------------------------------------------------------ 5. Standard Costing and Variance

Analysis Types of Standards and Sources of Standard Cost Information; Evolution of Standards, Continuous – Improvement; Keeping Standards Meaningful and Relevant; Variance Analysis; Disposal of Variances. (a) Investigation and Interpretation of

Variances and their Inter Relationship (b) Behavioural Considerations.

Management Accounting Control Budgetary Control – Behavioural Aspects 1) Concept of Budget as a Control System 2) Behavioural Aspects of Budgeting/

Budgetary Control 3) Beyond Budgeting ---------------------------------------------------------- Control through Standard Costing – Analysis and Interpretation of Variances 1) Analysis of Advanced Variances 2) Integration of Standard Costing with

Marginal Cost Accounting 3) Reconciliation of Statements 4) Variance Investigation, Variance

Investigation Techniques, Interpretation of Variances, Possible Interdependence Between Variances, and Reporting

5) Criticism of Standard Costing (including its use in the contemporary business environment)

Additions Standard Costing in the

Modern Manufacturing Environment

------------------------------------------ Deletions Standard Costing and

Variance Analysis>Behavioral Considerations

------------------------------------------ Shifted (Intermediate Paper-3) Budgets and Budgetary

Control Standard Costing and

Variance Analysis (Basic Concepts/ Disposal of Variances)

Reason for Additions Companies operating in

today's manufacturing environment, however, are likely to have strategies based on objectives. To help achieve these objectives, manufacturing strategies such as just-in-time (IIT), advanced manufacturing technology (AMT) and continuous improvement are often applied. Standard Costing is counter-productive in such an environment. The major criticisms levelled at standard costing variance analysis are discussed here.

-------------------------------------------- Reason for Deletions Specifically Covered in

Budgetary Control & Transfer Pricing (in proposed curriculum)

6. Transfer Pricing (a) Objectives of Transfer Pricing (b) Methods of Transfer Pricing (c) Conflict between a Division and a

Company (d) Multi-National Transfer Pricing 8.Uniform Costing and Inter Firm

Comparison 9. Profitability Analysis - Product Wise

/Segment Wise /Customer Wise

Performance Measurement and Reporting Divisional Performance Measures 1) Responsibility Accounting 2) Financial and Non-Financial

Performance Measures, Critical Success Factors and Link to Performance Measurement, Key Performance Indicators (KPI)

3) Performance Measurement in the Not-for-Profit Sector

4) Preparation of Performance Reports ---------------------------------------------------------- Divisional Transfer Pricing 1) Meaning, Purpose & Principles of

Transfer Pricing 2) Methods of Transfer Pricing 3) The Behavioural Consequences arising

from Divisional Structures 4) International Transfer Pricing ---------------------------------------------------------- Strategic Analysis of Operating Income 1) Operating Profit Analysis 2) Advanced Activity Based Costing –

Direct Product Profitability, Direct Customer Profitability, Distribution Channel Profitability; Activity – Based Management (ABM); Activity – Based Budgeting (ABB)

3) Pareto Analysis

Additions Divisional Performance

Measures ------------------------------------------ Deletions Uniform Costing and Inter

Firm Comparison ------------------------------------------

Reason for Additions Because of the complexity of

companies operations, it is difficult for top management to directly control operations. Therefore a company is divided into divisions and is allowed divisional managers to operate with a great deal of independence. When autonomous divisions are created it arise the danger that divisional managers might not pursue tasks that are in the best interests of the company as a whole. An effective performance measurement system helps to drive an organization towards the achievement of its strategic goals and is the basis for management decision making.

-------------------------------------------- Reason for Deletion Not relevant in today’s modern

environment.

7. Cost Management in Service Sector

Shifted (Intermediate Paper – 3)

10 .Financial Decision Modeling (a) Linear Programming (b) Network Analysis - PERT/CPM,

Resource Allocation and Resource Leveling.

(c) Transportation Problems (d) Assignment Problems (e) Simulation (f) Learning Curve Theory

Application Quantitative Methods to Management Accounting 1) Learning Curve/ Experience Curve 2) Linear Programming, Transportation &

Assignment Problems 3) Simulation 4) Network Analysis

NOMENCLATURE To make this subject internationally comparable,the name of the subject may be changed to “STRATEGIC MANAGEMENT ACCOUNTING”.

New Syllabus of CA Final Paper 6 Part A: Financial Services and Capital Market

Financial Services and Capital Market (50 Marks) Changes (Addition/ Deletion)

Reasons for changes

1. Indian Financial System

• Financial Market

• Capital Market

• Primary Market

• Secondary Market

• Money Market Instruments

• Equity Market

• Debt Market

Shifted from the paper Strategic Financial Management (Paper 2- Final Level) to cover the topic in an elaborative manner.

2. Capital Market

• New Issue Market

• Right Issue

• Secondary Market

(a) Stock Market Operations (b) Indian Debt Market


3. Commodity Market

• What are Commodity Markets

• Role of Commodity Markets

• Commodity Market in India

• Application of Derivative in Commodities


• Global Commodities Exchanges

4. Derivatives Analysis and Valuation

• Forward/ Future Contract

• Options

• Swaps

Shifted from Paper 7: Financial Management & Business Economic Environment at Intermediate Level

More appropriate with Capital Market topic.

5. Merchant Banking

• Basics

• Meaning

• Organization

• Scope of Merchant Banking

• Functions of Merchant Banking

Addition Huge scope for employment of CAs in this field.

6. Mutual Funds

• Meaning

• Evolution

• Types

• Performance Measures

• Mutual Fund Organisation

• Advantages and Disadvantages of Mutual Fund

• Exchange Traded Funds (ETFs)


7. Factoring and Forfaiting

• Introduction and Concept

• Factoring and Bill Discounting


• Mechanism

• Service Package

• Types of Factoring

• Benefits and Problems of Factoring

• Financial Aspects of Factoring

• Financial Evaluation of Factoring Decision

• Forfaiting

8. Credit Rating

• Introduction

• Rating Services

• Objectives and types

• Uses

• Credit Rating Process

• Credit Rating Methodology

• Rating Revisions

• Credit Rating Agencies in India

• Limitations

• SEBI and Credit Rating


9. Securitization

• Introduction

• Concept and Definition

• Benefits of Securitization

• Participants in Securitization


• Mechanism of Securitization

• Problems in Securitization

• Securitization Instruments

• Pricing of Securitization Instruments

• Securitization in India

10. Private Equity • Meaning and Classification (a) Venture Capital (b) Buyouts (c) Special Cases • Risk and Cost of Investing in Private Equity • Exit Routes • Valuation of Private Equity Transactions • Private Equity Funds

Addition Huge scope for employment of CAs in this field.

11. Investment Banking

• Concept

• Functions

• Challenges

• Developments in Investment Banking


12. The Securities and Exchange Board of India Act, 1992

• Rules

• Regulations

• Guidelines issued thereunder

Shifted from the paper Corporate Laws and Other Economic Laws (Paper 4 – Final Level)

More relevant in context with overall study of Capital Market.

12. Legislative framework on listing agreements Shifted from the paper Corporate Laws and Other Economic Laws (Paper 4 – Final Level)


13. The Securities Contract (Regulation) Act, 1956 Shifted from the paper Corporate Laws and Other Economic Laws (Paper 4 – Final Level)


14. Chapter III-D of the RBI Act, 1934 Addition More relevant in context with overall study of Capital Market.

Changes made in the Syllabus of CA Final Paper 6B: Information Systems Control and Audit (proposed) vis-a-vis Paper 6: Information Systems Control and Audit (existing).

Paper 6: Information Systems Control and Audit (100 Marks) - Existing

Paper 6B: Information Systems Control and Audit (50 Marks) -

Proposed


Reasons for changes

1. Concepts of Governance and Management of Information Systems: Governance, Risk and compliance and relationship between governance and management.

Role of information technology and IS Strategy in business strategy, operations and control , business value from use of IT, business impact of IS risks different types of Information Systems Risks, IS Risk management overview, IT Compliance overview – Role and responsibilities of top management as regards IT-GRC. Role of Information Systems Assurance. Overview of Governance of Enterprise IT and COBIT.

CHAPTER 1: CONCEPTS OF GOVERNANCE AND MANAGEMENT OF INFORMATION SYSTEMS • Overview of Governance, Risk and

Compliance (GRC); • Overview of Governance of Enterprise

IT (GEIT); • COBIT 5 Framework: Principles,

Enablers, Processes, Assurance

- -

2. Information Systems Concepts: Overview of information systems in IT environment and practical aspects of application of information systems in enterprise processes. Information as a key business asset and its relation to business objectives, business processes and relative importance of information systems from strategic and operational

- - The basic knowledge about Information and business processes and its importance has been a part of Intermediate (IPC) Paper 7A: Information

perspectives. Various types of business applications, overview of underlying IT technologies.

Technology. Thus the chapter holds more relevance at Intermediate level and has been shifted from Final level to Intermediate level.

3. Protection of Information Systems: Need for protection of Information systems, types of controls, IT general controls, logical access controls & application controls. Technologies and security management features, IS Security Policies, procedures, practices, standards and guidelines, IT controls and control objectives, Role of technology systems in control monitoring, segregation of duties. Impact of IT controls on Internal controls over financial reporting, cyber frauds and control failures.

CHAPTER 2: INFORMATION SYSTEMS’ CONTROLS AND RISK MANAGEMENT • Need for protection of Information

systems, Business impact of various Information Systems Risks, IT Risk Management;

• Need of controls and control objectives, Overview of Information Systems’ Controls – Management Control and Application Control framework;

• Information Systems Security Policies, Standards and Guidelines; Review and monitoring of controls at various levels - Parameters, user creation, granting of access rights, segregation of duties etc.;

• Internal Controls over Financial Reporting (ICFR), Control failures, Information Technology related fraud.

Addition: • Internal Controls

over Financial Reporting (ICFR), Control failures, Information Technology related fraud.

The topic is covered in DISA and is quite relevant for aspiring Chartered Accountants. Due to advancement in technology, IT related frauds are quite prevalent in today’s world and the students must be provided knowledge about the same.

4. Business Continuity Planning and Disaster recovery planning: Assessing Business Continuity Management, Business Impact Analysis and Business Continuity Plans, Disaster recovery from perspective of going concern,

CHAPTER 4: BUSINESS CONTINUITY PLANNING AND DISASTER RECOVERY PLANNING

• Assessing and mapping Business Continuity Management (BCM)

Addition: • Industry best

practices and regulatory requirements as

The topic is covered in DISA and is quite relevant for aspiring Chartered Accountants.

Recovery Strategies.

practices to organization requirements, objectives and budgets;

• Assessing the process of Business Impact Analysis (BIA);

• Evaluate adequacy of Business Continuity Plans processes and practices;

• Disaster Recovery Strategies and Plans; • Data Backup, Retention and

Restoration Practices, Documentation: BCP Manual and BCM Policy;

• Industry best practices and regulatory requirements as relevant for Business Continuity Management (BCM).

relevant for Business Continuity Management (BCM).

The knowledge of these best practices serve as both a guide for BCM Program development, implementation and maintenance and as a tool for conducting audits of an existing program, and must be known to aspiring Chartered accountant.

5. Acquisition, Development and Implementation of Information Systems (SDLC): Business process design (integrated systems, automated, and manual interfaces), Software procurement, RFP process, evaluation of IT proposals, computing ROI, Computing Cost of IT implementation and cost benefit analysis, systematic approach to SDLC and review of SDLC controls at different stages.

- Shifted at Intermediate Level

The basic knowledge about Information Systems and development has been a part of syllabus of Intermediate (IPC) Paper 7A: Information Technology. Thus the chapter holds more relevance at Intermediate level and has been shifted from Final level to Intermediate level.

6. Auditing of Information Systems: Different types of IS audit and assurance engagements. Evaluating IT

CHAPTER 3: INFORMATION SYSTEMS’ AUDIT

Addition • BCP Audit • Ethics and

These topics are upcoming topics and are expected to be

dependencies for audit planning. Overview of continuous auditing. Auditing Information Systems- Approach methodology, and standards for auditing information systems. IS Audit planning, performing an IS audit, rules of digital evidence, best practices and standards for IS audit. Reviewing General Controls, Application Controls, Application control reviews: Review of controls at various levels/layers such as: Parameters, user creation, granting of access rights, input, processing and output controls.

• Different types of Information Systems audit and assurance engagements;

• Auditing Information Systems - Approach methodology, best practices and standards;

• Information Systems (IS) Audit planning and Business Continuity Planning (BCP) Audit;

• Ethics and Standards for the Information System’s Auditor;

• Auditing Information Technology using Computer Assisted Audit (CAAT) Tools and Techniques, Risk assessment techniques, Business Intelligence and Business analytics;

• System Audit Report as per best practices.

Standards for the Information System’s Auditor;

• Auditing Information Technology using Computer Assisted Audit (CAAT) Tools and Techniques, Risk assessment techniques, Business Intelligence and Business analytics;

• System Audit Report as per best practices.

known by an IS Auditor as (s)he has to be well versed with the IS Audit and Assurance engagements, standards and processes involves in an IS Audit. Furthermore, which type of Audit has to be implemented depending upon the structure and environment of an organization need to be analysed and chosen. The IS Auditor needs to have thorough understanding of Industry's best practices in order to conduct IS Audit and prepare the report accordingly. Thus the students need to be aware of this topic.

7. Information Technology Regulatory Issues: Overview of Specific section of IT Act 2008 & Rules as relevant for assurance: Electronic Contracting, digital signatures, cyber offences, etc.

- The topic “IT Act, 2000” has been shifted to Intermediate (IPC) Paper 8A: Information Technology.

“SEBI clause 49 etc.” is proposed to be under Final Paper 6B: Financial Services and Capital

Need for systems audit as per various regulations such as: SEBI Clause 49 listing requirements and internal controls, systems control & audit requirements as per RBI, SEBI, IRDA. Concepts of Cyber forensics/Cyber Fraud investigation, Overview of Information Security Standards ISO 27001, ISAE 3402/SA 402, ITIL.

Deleted: Need for systems audit as per various regulations such as: SEBI Clause 49 listing requirements and internal controls, systems control & audit requirements as per RBI, SEBI, IRDA. Overview of Information Security Standards ISO 27001, ISAE 3402/SA 402, ITIL.

Market (FSCM). “SA 402”has been a part of Final Paper 3: Advanced Auditing and Professional Ethics”. Remaining Security standards are not much relevant and thus have been removed from the syllabus.

8. Emerging Technologies: Overview of Cloud Computing, Software as a Service, Mobile Computing & BYOD, Web 2.0 & social media, Green IT and related security and audit issues.

- Shifted to Intermediate Level Paper 8A: Information Technology

Holds more relevance at Intermediate Level.

Comparative Statement of old and New Syllabus of Final along with the Examination Pattern.

Existing Syllabus Draft Revised Syllabus Addition /Deletion

Comments/Reasons

Final Course Final Course

Number and Name of Papers -8

(each paper of 100 marks)

Number and Name of Papers

Number of Papers – 8

Group II Group II

Paper - 7: Direct Tax Laws (100 Marks)

Paper 7: Advanced Direct Tax Laws & International Taxation

Part I : Advanced Direct Tax Laws (70 Marks)

Law and Procedures under the Income-tax Act, 1961

Level of Knowledge: Advanced knowledge

Objectives:

(a) To gain advanced knowledge of the provisions of direct tax laws

(b) To acquire the ability to apply the knowledge of the provisions of the direct tax laws to various situations in actual practice

Level of knowledge : Advanced knowledge

Objective:

To acquire the ability to analyze and interpret the provisions of direct tax laws and recommend solutions to practical problems.

Objective modified

Objective statement for both parts have been drafted in a manner to align with the requirement of the level of knowledge required in the respective part, to ensure clarity in the competence requirement at the said level and make the same relevant in the context of both academic education and work place requirement.

The Income-tax Act, 1961 and Rules thereunder

While covering the direct tax laws, students should familiarise themselves with considerations relevant to tax management. These may include tax considerations with regard to specific management decisions, foreign collaboration agreements, international taxation, amalgamations, tax incentives, personnel compensation plans, inter-relationship of taxation and accounting, with special reference to relevant accounting standards and other precautions to be observed to maximise tax relief. Further, they should have a basic understanding about the ethical considerations in tax management and compliance with taxation laws.

Law and Procedures under the Income-tax Act, 1961, (i) Basis of charge, income which do not

form part of total income, heads of income, income of other persons included in assessee’s total income, aggregation of income, set-off and carry forward of losses, deductions from gross total income, rebates and reliefs

(ii) Special provisions relating to companies and certain persons other than a company1

(iii) Liability in Special Cases2 (iv) Tax Planning, Tax Avoidance & Tax

Evasion (v) Income-tax Authorities (vi) Procedure for assessment (vii) Appeals and Revision (viii) Settlement of Tax Cases (ix) Penalties (x) Offences & Prosecution (xi) Miscellaneous Provisions (xii) Collection & Recovery of Tax, Refunds (xiii) Other Provisions 3

No Addition or Deletion. International Taxation Provisions under the Income-tax Act, 1961 have been shifted to Part II: International Taxation

• Topic-wise contents have been incorporated in the revised syllabus to give the students a broad idea of the coverage of various topics under Part I: Advanced Direct Tax Laws and Part II: International Taxation.

1 Including firms, LLPs, Trusts, AOPs, BOIs, Securitsation Trusts, Business Trusts, Investment Fund etc. 2 Representative assessees, Executors etc. 3 The entire income-tax law is included at the Final level. Any residuary provision under the Income-tax Act, 1961, not covered under any of the above specific provisions, would be covered under “Other Provisions”. Further, if any new chapter is included in the Income-tax Act, 1961, the syllabus will accordingly include the provisions relating thereto.

-

Income-tax Act, 1961

(International Taxation provisions under the Income-tax Act, 1961 are covered under the Existing Syllabus)

Part II: International Taxation (30 Marks) Addition A separate dedicated section for International Taxation (30 Marks) has been introduced.

Level of knowledge : Working knowledge

Objective:

To develop an understanding of the provisions of International Taxation and acquire the ability to apply such knowledge to make computations and address other issues in non-complex scenarios.

Objective statement for both parts have been drafted in a manner to align with the requirement of the level of knowledge required in the respective part, to ensure clarity in the competence requirement at the said level and make the same relevant in the context of both academic education and work place requirement.

(1) International Taxation provisions under the Income-tax Act, 1961, including

(i) Non-resident Taxation

(ii) Double Taxation Relief

(iii) Transfer Pricing & Other Anti-Avoidance Measures

(iv) Advance Rulings

(v) Specific Reporting Regime in respect of Country by Country reporting and master file

(vi) Tax incentives to International Financial Services Centre

(2) Equalisation levy

(3) Overview of Model Tax Conventions

(4) Tax treaties: application and interpretation

(5) Tax Information Exchange Agreements

(6) Base Erosion and Profit Shifting

(7) Law and Procedures under the Black Money

- Equalisation levy - Overview of Model Tax Conventions - Tax treaties: application and interpretation - Tax Information Exchange Agreements - Base Erosion and Profit Shifting - Law and Procedures under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.

Due to globalisation measures, many non-residents are increasingly having business relations with India. Therefore, issues relating to taxation of non-residents and international taxation are assuming great importance and creating new professional avenues for chartered accountants. The Department is also moving with the times and has taken many administrative initiatives to cope up with the emergence of new issues. The transfer pricing provisions, and the new law to curb stashing of black money abroad are the recent significant initiatives in this direction.

(Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.

Note: If new legislation(s) are enacted in place of the existing legislation(s), the syllabus will accordingly include such new legislation(s) in the place of the existing legislation(s) with effect from the date to be notified by the Institute

Note: If any new legislation is enacted in place of an existing legislation, the syllabus will accordingly include the corresponding provisions of such new legislation in the place of the existing legislation with effect from the date to be notified by the Institute. Similarly, if any existing legislation on direct tax laws ceases to be in force, the syllabus will accordingly exclude such legislation with effect from the date to be notified by the Institute.

Note to syllabus modified. If any legislation ceases to have effect, the syllabus will accordingly exclude such legislation from a date to be notified by the Institute.

Comparative Statement of changes made in the syllabus of CA Final Paper 8: Advanced Indirect Tax Laws (proposed) vis-à-vis Paper 8: Indirect Tax Laws (existing). Existing Syllabus Draft Revised Syllabus Changes

(Addition /Deletion) Comments/Reasons

Group II Group II Paper - 8: Indirect Tax Laws (100 Marks)

Paper - 8: Advanced Indirect Tax Laws (100 Marks)

Objectives: (a) To gain advanced

knowledge of the principles of the laws relating to central excise, service tax and customs

(b) To acquire the ability to apply the knowledge of the provisions of the above-mentioned laws to various situations in actual practice

Objective: To acquire the ability to analyze and interpret the provisions of indirect tax laws and recommend solutions to practical problems.

Objective modified Objective statement has been redrafted to align with the required knowledge, to ensure clarity in the competence requirement at the said level and make the same relevant in the context of both academic education and work place requirement.

1 The entire central excise law is included in the syllabus at the Final level. Any residuary provision under the Central Excise Act, 1944 and Central Excise Tariff Act, 1985, not covered under any of the above specific provisions, would be covered under “Other Provisions”. Further, if any new Chapter is included in the Central Excise Act, 1944 or Central Excise Tariff Act, 1985, the syllabus will accordingly include the provisions relating thereto

Section A: Central Excise (25 Marks) Central Excise Act, 1944 and the Central Excise Tariff Act, 1985

Section A: Central Excise , Service Tax and GST (75 Marks) I. Central Excise Law as contained in the Central Excise Act, 1944 and the Central Excise Tariff Act, 1985 • Constitutional aspects • Levy of excise duty – All provisions including application of excise law, taxable event, charge of excise duty, concept of goods and excisable goods, manufacture, rate of excise duty, exemption from excise duty • Classification and Valuation of excisable goods • CENVAT Credit mechanism • Procedures under central excise – All procedures including removal of excisable goods, registration, invoicing, records, payment of excise duty, returns, assessment, bonds, warehousing of excisable goods, remission of duty, export procedures, SSI exemption • Demand, Adjudication, Refund, Offences, Penalties, Confiscation, Prosecution • Powers of Central Excise Officers, Recovery proceedings, Audit under central excise • Appeals and Revision, Advance Ruling, Settlement Commission • Other provisions1


The marks allocation of Section A: Central Excise and Section B: Service Tax in the existing syllabus is 25 Marks and 50 Marks respectively. However, this restricted the questions set for Section A: Central Excise to maximum of 4 marks each in the non-compulsory questions. In order to enable the paper setters set better questions carrying more marks, Section A: Central Excise and Section B: Service Tax have been combined and together 75 Marks have been allocated to Section A: Central Excise, Service Tax and GST. Also, this has also been done since the adjudication and appellate procedures of central excise and service tax are more or less the same and CENVAT provisions are integrated for excise and service tax.

2 The entire service tax law is included in the syllabus at the Final level. Any residuary provision relating to service tax under the Finance Act, 1994 as amended from time to time, not covered under any of the above specific provisions, would be covered under “Other Provisions”. Further, if any new Chapter relating to service tax is included in the Finance Act, 1994, the syllabus will accordingly include the provisions relating thereto.

II. Law relating to service tax as contained in the Finance Act, 1994 as amended from time to time • Constitutional and other general aspects • Levy of service tax – All provisions including application of service tax law, concept of service, charge of service tax, negative list of services, declared services, bundled services, date of determination of rate of tax, value of taxable service and rate of exchange, place of provision of service, point of taxation • Valuation of taxable service • Exemptions and Abatements • Procedures under service tax –All procedures including registration, invoicing, person liable to pay service tax, payment of service tax including payment under reverse charge, interest on delayed payment of service tax, returns, records, assessment • Demand, Adjudication, Offences, Penalties, Prosecution, Powers of Central Excise Officers, Recovery proceedings, Audit under service tax • Appeals, Advance Ruling • Other provisions2 III. Goods and Services Tax (GST) - Overview of proposed GST in India

Goods and Services Tax included in Section A

Section B: Service Tax (50 Marks) Law relating to service tax as contained in the Finance Act, 1994 as amended from time to time

Shifted to Section A

Discussed above

Section C: Customs & Foreign Trade Policy (25 Marks) Customs Act, 1962, Customs Tariff Act, 1975 and Foreign Trade Policy to the extent relevant to the Customs Law

Section B: Customs (25 Marks) I. Customs Law as contained in the Customs Act, 1962 and the Customs Tariff Act, 1975 • Constitutional aspects • Levy of customs duty – All provisions including application of customs law, taxable event, charge of customs duty, exceptions to levy of customs duty, exemption from custom duty • Types of duties • Classification and valuation of imported and export goods • Import and Export Procedures – All import and export procedures including special procedures relating to baggage, goods imported or exported by post, stores • Provisions relating to prohibited goods, notified goods, specified goods, illegal importation/exportation of goods

Topic-wise contents incorporated

The allocation of marks for Section C: Customs and Foreign Trade Policy is unchanged. Only the nomenclature has been changed from existing Section C: Customs and Foreign Trade Policy to proposed section B: Customs.

3 The entire customs law is included in the syllabus at the Final level. Any residuary provision under the Customs Act, 1962 or Customs Tariff Act, 1975, not covered under any of the above specific provisions, would be covered under “Other Provisions”. Further, if any new Chapter is included in the Customs Act, 1962 or Customs Tariff Act, 1975, the syllabus will accordingly include the provisions relating thereto.

• Warehousing and Drawback • Demand, Adjudication, Refund, Offences, Penalties, Confiscation, Prosecution • Powers of Proper Officers, Recovery proceedings • Appeals and Revision, Advance Ruling, Settlement Commission • Other provisions3 II. Foreign Trade Policy to the extent relevant to the indirect tax laws • Introduction to FTP – legislation governing FTP, salient features of an FTP, administration of FTP, contents of FTP and other related provisions • Overview of provisions relating to import and export of goods • Overview of export promotion schemes provided under FTP

Note – If new legislations are enacted in place of the existing legislations relating to central excise, customs and service tax, the syllabus will accordingly include such new legislations in place of the existing legislations with effect from the date to be notified by the Institute.

Note – With respect to Goods and Services Tax as covered in point (III) under Section A: Central Excise, Service Tax and GST and Foreign Trade Policy as covered in point (II) under Section B: Customs, only a working level of knowledge is expected from students. 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

• Note to syllabus modified to specify that with respect to Goods and Services Tax as covered in point (III) under Section A: Central Excise, Service Tax and GST and Foreign Trade Policy as covered in point (II) under Section B: Customs, only a working level of knowledge

Since overview of GST is to be included, only working knowledge of the same be expected from the students. Further, in respect of Foreign Trade Policy too, only a working level of knowledge should be expected from students because they read the same for the first time only at Final level, and also because the Policy and

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. Further, considering that Goods and Services Tax may be implemented in India in near future, the syllabus will accordingly be modified to include the same with effect from the date to be notified by the Institute.

will be expected from students.

• Note to syllabus modified to include a specific reference to GST.

• Note to syllabus also refer to introduction of the concept of Study Guide to indicate specific inclusions in and exclusions from the syllabus before each examination

the procedures together are quite voluminous.