ICWAI (ICAI) : Syllabus - Intermediate Course (Group - I)

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Syllabus : Foundation | Intermediate Group I | Intermediate Group II | Final Group III | Final Group IV

Paper 5 : Financial Accounting (One Paper: 3 hours:100 marks)

1. Accounting Conventions and Practices
Concept
Depreciation and various methods thereof
Stock valuation
Distinction between Capital and Revenue

2. Royalty and Hire Purchase
Royalty accounting
Need for hire purchase and installment systems and parties involved.
Accounting from the point of view various parties.
Possession and repossession in case of default in payments.

3. Receipts & Payments/ Income & Expenditure Accounts
Receipts & Payments
Income & Expenditure Account

4. Partnership Accounting
Past adjustments and guarantee
Admission & Retirement
Assignment of life policy
Amalgamation and Sale of Business
Dissolution, Insolvency
Piecemeal Distribution

5. Branch and Departmental Accounts
Branch accounts- Debtors system, Stock & Debtors system, Foreign Branch.
Treatment of shortages.
Calculation of net profit of various departments and allocation of expenses on the basis of suitable base.
Preparation of common balance sheet.
Treatment of Unrealized profit.

6. Accounting Standards
Applicability of a particular accounting standard.
Interpretation of various accounting standards.
Scope of accounting standards.
Compliance with the Accounting Standards.

7. Joint Stock Companies
Issues of shares at par, discount & premium, forfeiture, reissue of shares
Bonus issue and right issue
Buy back of shares
Redemption of Preference of shares
Profit prior to incorporation
Issue and redemption of debentures

8. Preparation of Company Accounts
Preparation of Final Accounts under Company Law

9. Accounting services in organizations
Construction companies ,Project Accounting
Service sector such as Software, ITES, Telecommunication, Entertainment, Hospital, educational institutions
Banking , Electricity and Insurance companies

10. Accounting and Interpretation of Financial Statements

Paper 6: Commercial & Industrial Laws and Auditing (One Paper: 3 hours:100 marks)

A. Commercial & Industrial Law ( 50 marks)
1. Laws of Contracts
Essential elements of a valid simple contract.
Legal status of the various types of statements which may be made by negotiating parties. Enforceable offers and
acceptances, and the application of the rules to standard form contracts and modern forms of communication.
Meaning and importance of consideration.
Principles for establishing that the parties intend their agreement to have contractual force.
How a contract is affected by a misrepresentation.
Conditions and warranties
Manner in which law controls use of exclusion clauses and unfair terms in consumer and non-consumer transactions
Level of performance sufficient to discharge contractual obligations
Valid reasons for non-performance by way of agreement, breach by the other party and frustration
2. Laws relating to Sale of Goods
Formation of Contract of sale
Conditions and warranties
Transfer of ownership and delivery of goods
Unpaid seller and his rights
3. Industrial Laws
Factories Act
Industrial Dispute Act
Workman Compensation Act
Payment of Wages Act, Minimum Wages Act
Provident Funds Act
Payment of Bonus Act
Payment of Gratuity Act
Consumer Protection Act etc
4. Other Laws
Limited Liability Partnership
RTI Act
Competition Commission Act
Negotiable Instruments Act

B. Auditing ( 50 Marks)
1. Auditing Basics
Major influences of auditing; nature and scope of auditing; basic concepts of auditing; role of evidence in auditing; auditing techniques and practices – generally accepted auditing standards; the concept of materiality in auditing.
Fixed assets, investments, inventories, debtors, loans and advances, cash and bank balances, debentures and creditors, provisions for taxation, proposed dividend and gratuity – other items in the balance sheet; verification of items in the profit and loss account; contingent liabilities; disclosure of accounting policies, practice; expenditure during the period of construction; adjustments for previous year – provisions of the Companies Act, 1956 regarding accounts. Restructure
Statistical sampling in auditing. Use of ratios and percentages for comparison and analysis trends - inter-firm and intra-firm comparison.
2. Companies Act Provisions relating to Audits
Auditors' appointment, remuneration, removal, rights of statutory auditors, duties of statutory auditors, joint auditors,
branch audits.
report versus certificate, contents of the reports, qualifications in the report.
relevant provisions of the Companies Act, 1956 and the Income-tax Act, 1961.
Interface between statutory auditor and internal auditor.
Corporate Governance
3. Review and Audit of Internal Control Systems
Nature and scope of internal auditing, financial versus operational audit; concepts of efficiency audit, propriety audit,
voucher audit, compliance audit, pre and post audits.
CARO
Audit Report
Internal auditing function
Planning and process of internal audit
Verification of evidence, detailed checking versus sampling plans, statistical sampling as used in internal auditing;
flow chart techniques.
Internal control, nature and scope, internal auditor and internal controls.
Field work, collecting evidences, interviews; memoranda.
Audit notes and working papers.
Audit reports - techniques of effective reporting; follow up of audit report.
Summary reports of top management.
Communications in internal auditing - improving auditor-auditee relationship.
Scope of Audit Committee
Internal audit and investigation of fraud
4. Information System Audit
5. Introduction to Management Audit

Paper 7: Applied Direct Taxation (One Paper: 3 hours:100 marks)

1. Direct Taxes- Comprehensive Study
Overview of Direct Tax Laws
Direct versus indirect taxes, taxable person
Basic Concepts.
A comprehensive study of the Income-tax Act, 1961; case laws governing capital and revenue expenditure, deemed income, residence concept.
Special problems centering on the concept of assessees, registered firm, Hindu Undivided Family, Companies, Association of persons and trust, minors, cooperatives, non-resident Indians and avoidance of double taxation.
Salaries, perquisites, gratuity and retirement benefits, income from house property, capital gains, income from other sources, income from business and profession, problems arising from aggregation of income and set off and carry forward of losses,
Computation of income and Return of Income Tax, Filing procedure, Principles of valuation of movable and immovable property. Advance payment of Tax.
Deduction and collection of tax at source.
Tax incentives and export promotion schemes, other benefits and tax exemptions.
Assessment, appeals, revisions, review, rectification and application to Central Board of Direct Taxes.
Penalties ,Fines and prosecution.
Refunds.
Securities Transaction Tax.
Fringe Benefit Tax.
Banking Cash Transaction Tax.
Wealth Tax.
2. Practical problems and case studies under Direct Taxes