Units

Periods

Marks

Part A: Financial Accounting-1

Unit-1: Theoretical Framework

25

12

Unit-2: Accounting Process

105

40

Part B: Financial Accounting-II

Unit-3: Financial Statements of Sole Proprietorship from Complete and

Incomplete Records

55

20

Unit-4: Computers in Accounting

15

08

Part C: Project Work

20

20

Units/Topics

Learning Outcomes

Introduction to Accounting

·         Accounting- concept, objectives, advantages and limitations, types of accounting information; users of accounting information and their needs. Qualitative Characteristics of Accounting Information. Role of Accounting in Business.

·         Basic Accounting Terms- Business Transaction, Capital, Drawings. Liabilities (Non Current and Current). Assets (Non Current, Current); Fixed assets (Tangible and Intangible), Expenditure (Capital and Revenue), Expense, Income, Profit, Gain, Loss, Purchase, Sales, Goods, Stock, Debtor, Creditor, Voucher, Discount (Trade discount and Cash Discount)

After going through this Unit, the students will be able to:

·         describe the meaning, significance, objectives, advantages and limitations of accounting in the modem economic environment with varied types of business and non-business economic entities.

·         identify / recognise the individual(s) and entities that use accounting information for serving their needs of decision making.

·         explain the various terms used in accounting and differentiate between different related terms like current and non-current, capital and revenue.

·         give examples of terms like business transaction, liabilities, assets, expenditure

and purchases.

Theory Base of Accounting

·         Fundamental accounting assumptions: GAAP: Concept

·         Business Entity, Money Measurement, Going Concern, Accounting Period, Cost Concept, Dual Aspect, Revenue Recognition, Matching, Full Disclosure, Consistency, Conservatism, Materiality and Objectivity

·         System of Accounting. Basis of Accounting: cash basis and accrual basis

·         Accounting Standards: Applicability in IndAS

·         Goods and Services Tax (GST): Characteristics and Objective.

·         explain that sales/purchases include both cash and credit sales/purchases relating to the accounting year.

·         differentiate among income, profits and gains.

·         state the meaning of fundamental accounting assumptions and their relevance in accounting.

·         describe the meaning of accounting assumptions and the situation in which an assumption is applied during the accounting process.

·         explain the meaning and objectives of accounting standards.

·         appreciate that various accounting standards developed nationally and globally are in practice for bringing parity in the accounting treatment of different items.

·         acknowledge the fact that recording of accounting transactions follows double entry system.

·         explain the bases of recording accounting transaction and to appreciate that accrual basis is a better basis for depicting the correct financial position of an enterprise.

·         Understand the need of IFRS

·         Explain the meaning, objective and characteristic of GST.

Units/Topics

Learning Outcomes

Recording of Business Transactions

·         Voucher and Transactions: Source documents and Vouchers, Preparation of Vouchers, Accounting Equation Approach: Meaning and Analysis, Rules of Debit and Credit.

·         Recording of Transactions: Books of Original

After going through this Unit, the students will be able to:

·         explain the concept of accounting equation and appreciate that every transaction affects either both the sides of the equation or a positive effect on one item and a negative

effect on another item on the same side of

Entry- Journal

·         Special Purpose books:

·         Cash Book: Simple, cash book with bank column and petty cashbook

·         Purchases book

·         Sales book

·         Purchases return book

·         Sales return book

Note: Including trade discount, freight and cartage expenses for simple GST calculation.

·         Ledger: Format, Posting from journal and subsidiary books, Balancing of accounts

Bank Reconciliation Statement:

·         Need and preparation, Bank Reconciliation Statement with Adjusted Cash Book

Depreciation, Provisions and Reserves

·         Depreciation: Concept, Features, Causes, factors

·         Other similar terms: Depletion and Amortisation

·          Methods of Depreciation:

i. Straight Line Method (SLM)

ii. Written Down Value Method (WDV)

Note: Excluding change of method

·         Difference between SLM and WDV; Advantages of SLM and WDV

·         Accounting treatment of depreciation

i. Charging to asset account

ii. Creating provision for depreciation/accumulated depreciation account

iii. Treatment for disposal of asset

·         Provisions and Reserves: Difference

·         Types of Reserves:

i. Revenue reserve

ii. Capital reserve

iii. General reserve

iv. Specific reserve

accounting equation.

·         explain the effect of a transaction (increase or decrease) on the assets, liabilities, capital, revenue and expenses.

·         appreciate that on the basis of source documents, accounting vouchers are prepared for recording transaction in the books of accounts.

·         develop the understanding of recording of transactions in journal and the skill of calculating GST.

·         explain the purpose of maintaining a Cash Book and develop the skill of preparing the format of different types of cash books and the method of recording cash transactions in Cash book.

·         describe the method of recording transactions other than cash transactions as per their nature in different subsidiary books .

·         appreciate that at times bank balance as indicated by cash book is different from the bank balance as shown by the pass book / bank statement and to reconcile both the balances, bank reconciliation statement is prepared.

·         develop understanding of preparing bank reconciliation statement.

·         appreciate that for ascertaining the position of individual accounts, transactions are posted from subsidiary books and journal proper into the concerned accounts in the ledger and develop the skill of ledger posting.

·         explain the necessity of providing depreciation and develop the skill of using different methods for computing depreciation.

·         understand the accounting treatment of providing depreciation directly to the concerned asset account or by creating

provision for depreciation account.

v. Secret Reserve

·         Difference between capital and revenue reserve

Accounting for Bills of Exchange

·         Bill of exchange and Promissory Note: Definition, Specimen, Features, Parties.

·         Difference between Bill of Exchange and Promissory Note

·         Terms in Bill of Exchange:

i. Term of Bill

ii. Accommodation bill (concept)

iii. Days of Grace

iv. Date of maturity

v. Discounting of bill

vi. Endorsement of bill

vii. Bill after due date

viii. Negotiation

ix. Bill sent for collection

x. Dishonour of bill

xi. Retirement of bill

xii. Renewal of bill

·          Accounting Treatment

Note: excluding accounting treatment for accommodation bill

Trial balance and Rectification of Errors

·         Trial balance: objectives and preparation

(Scope: Trial balance with balance method only)

·         Errors: types-errors of omission, commission, principles, and compensating; their effect on Trial Balance.

·         Detection and rectification of errors; preparation of suspense account.

·         appreciate the method of asset disposal through the concerned asset account or by preparing asset disposal account.

·         appreciate the need for creating reserves and also making provisions for events which may belong to the current year but may happen in next year.

·         appreciate the difference between reserve and reserve fund.

·         acquire the knowledge of using bills of exchange and promissory notes for financing business transactions;

·         understand the meaning and distinctive features of these instruments and develop the skills of their preparation.

·         state the meaning of different terms used in bills of exchange and their implication in accounting.

·         explain the method of recording of bill transactions.

·         state the need and objectives of preparing trial balance and develop the skill of preparing trial balance.

·         appreciate that errors may be committed during the process of accounting.

·         understand the meaning of different types of errors and their effect on trial balance.

·         develop the skill of identification and location of errors and their rectification and preparation of suspense account.

Units/Topics

Learning Outcomes

Financial Statements

Meaning, objectives and importance; Revenue and Capital Receipts; Revenue and Capital Expenditure; Deferred Revenue expenditure.

Trading and Profit and Loss Account: Gross Profit, Operating profit and Net profit. Preparation.

Balance Sheet: need, grouping and marshalling of assets and liabilities. Preparation.

Adjustments in preparation of financial statements with respect to closing stock, outstanding expenses, prepaid expenses, accrued income, income received in advance, depreciation, bad debts, provision for doubtful debts, provision for discount on debtors, Abnormal loss, Goods taken for personal use/staff welfare, interest on capital and managers commission.

Preparation of Trading and Profit and Loss account and Balance Sheet of a sole proprietorship with adjustments.

Incomplete Records

Features, reasons and limitations.

Ascertainment of Profit/Loss by Statement of Affairs method.

Difference between accounts from incomplete records and Statement of Affairs. Preparation of Trading , Profit and Loss account and Balance Sheet.

After going through this Unit, the students will be able to:

·         state the meaning of financial statements the

·         purpose of preparing financial statements.

·         state the meaning of gross profit, operating profit and net profit and develop the skill of preparing trading and profit and loss account.

·         explain the need for preparing balance sheet.

·         understand the technique of grouping and marshalling of assets and liabilities.

·         appreciate that there may be certain items other than those shown in trial balance which may need adjustments while preparing financial statements.

·         develop the understanding and skill to do adjustments for items and their presentation in financial statements like depreciation, closing stock, provisions, abnormal loss etc.

·         develop the skill of preparation of trading and profit and loss account and balance sheet.

·         state the meaning of incomplete records and their uses and limitations.

·         develop the understanding and skill of computation of profit / loss using the statement of affairs method.

Units/Topics

Learning Outcomes

·         Introduction to computer and accounting information system {AIS}: Introduction to computers (elements, capabilities, limitations of computer system)

·         Introduction to operating software, utility

software and application software.

After going through this Unit, the students will be able to:

·         state the meaning of a computer, describe its components, capabilities and limitations.

·         state the meaning of accounting information

system.

Introduction to accounting information system (AIS) as a part of Management Information System.

·         Automation of accounting process: meaning

·         Stages in automation: (a) Accounting process in a computerised environment; comparison between manual accounting process and computerised accounting process, (b) Sourcing of accounting software; kinds of software: readymade software; customised software and tailor-made software; generic considerations before sourcing accounting software (c) creation of account groups and hierarchy (d) generation of reports – trial balance, profit and loss account and balance sheet

Scope:

(i)  The scope of the unit is to understand accounting as an information system for the generation of accounting information and preparation of accounting reports.

(ii) It is presumed that the working knowledge of any appropriate accounting software will be given to the students to help them learn basic accounting operations on computers.

·         appreciate the need for use of computers in accounting for preparing accounting reports.

·         develop the understanding of comparing the manual and computerized accounting process and appreciate the advantages and limitations of automation.

·         understand the different kinds of accounting software.

1. A beauty parlour

10. Men’s wear

19. A coffee shop

2. Men’s saloon

11. Ladies wear

20. A music shop

3. A tailoring shop

12. Kiddies wear

21. A juice shop

4. A canteen

13. A Saree shop

22. A school canteen

5. A cake shop

14. Artificial jewellery shop

23. An ice cream parlour

6. A confectionery shop

15. A small restaurant

24. A sandwich shop

7. A chocolate shop

16. A sweet shop

25. A flower shop

8. A dry cleaner

17. A grocery shop

9. A stationery shop

18. A shoe shop

S N

Typology of Questions

Marks

Percentage

1

Remembering and Understanding:

Exhibit memory of previously learned material by recalling facts, terms, basic concepts, and answers.

Demonstrate understanding of facts and ideas by organizing, comparing, translating, interpreting, giving descriptions, and stating main ideas

44

55%

3

Applying: Solve problems to new situations by applying acquired knowledge, facts, techniques and rules in a different way.

19

23.75%

4

Analysing, Evaluating and Creating:

Examine and break information into parts by identifying motives or causes. Make inferences and find evidence to support generalizations.

Present and defend opinions by making judgments about information, validity of ideas, or quality of work based on a set of criteria.

Compile information together in a different way by combining elements in a new pattern or proposing alternative solutions.

17

21.25%

TOTAL

80

100%

Units

Periods

Marks

Part A

Accounting for Not-for-Profit Organizations, Partnership Firms and

Companies

Unit 1. Financial Statements of Not-for-Profit Organizations

25

10

Unit 2. Accounting for Partnership Firms

90

30

Unit 3. Accounting for Companies

35

20

150

60

Part B

Financial Statement Analysis

Unit 4. Analysis of Financial Statements

30

12

Unit 5. Cash Flow Statement

20

8

50

20

Part C

Project Work

20

20

Project work will include:

Project File

4 Marks

Written Test

12 Marks (One Hour)

Viva Voce

4 Marks

Or

Part B

Computerized Accounting

Unit 4. Computerized Accounting

50

20

Part C

Practical Work

20

20

Practical work will include:

Practical File 4 Marks

Practical Examination 12 Marks (One Hour)

Viva Voce 4 Marks

Units/Topics

Learning Outcomes

·         Not-for-profit organizations: concept.

·         Receipts and Payments Account: features and preparation.

·         Income and Expenditure Account: features, preparation of income and expenditure account and balance sheet from the given receipts and payments account with additional information.

Scope:

(i)  Adjustments in a question should not exceed 3 or 4 in number and restricted to subscriptions, consumption of consumables and sale of assets/ old material.

(ii)  Entrance/admission fees and general donations are to be treated as revenue receipts.

(iii)  Trading Account of incidental activities is not to be prepared.

After going through this Unit, the students will be able to:

·         state the meaning of a Not-for-profit organisation and its distinction from a profit making entity.

·         state the meaning of receipts and payments account, and understanding its features.

·         develop the understanding and skill of preparing receipts and payments account.

·         state the meaning of income and expenditure account and understand its features.

·         develop the understanding and skill of preparing income and expenditure account and balance sheet of a not-for-profit organisation with the help of given receipts and payments account and additional

information.

Units/Topics

Learning Outcomes

·         Partnership: features, Partnership Deed.

·         Provisions of the Indian Partnership Act 1932 in the absence of partnership deed.

·         Fixed v/s fluctuating capital accounts. Preparation of Profit and Loss Appropriation account- division of profit among partners, guarantee of profits.

·         Past adjustments (relating to interest on capital, interest on drawing, salary and profit sharing ratio).

·         Goodwill: nature, factors affecting and methods of valuation – average profit, super profit and capitalization.

Note: Interest on partner’s loan is to be treated as a

After going through this Unit, the students will be able to:

·         state the meaning of partnership, partnership firm and partnership deed.

·         describe the characteristic features of partnership and the contents of partnership deed.

·         discuss the significance of provision of Partnership Act in the absence of partnership deed.

·         differentiate between fixed and fluctuating capital, outline the process and develop the understanding and skill of preparation of Profit and Loss Appropriation Account.

·         develop the understanding and skill of

charge against profits.

Goodwill to be adjusted through partners capital/ current account or by raising and writing off goodwill (AS 26)

Accounting for Partnership firms – Reconstitution and Dissolution.

·         Change in the Profit Sharing Ratio among the existing partners – sacrificing ratio, gaining ratio, accounting for revaluation of assets and reassessment of liabilities and treatment of reserves and accumulated profits. Preparation of revaluation account and balance sheet.

·         Admission of a partner – effect of admission of a partner on change in the profit sharing ratio, treatment of goodwill (as per AS 26), treatment for revaluation of assets and re- assessment of liabilities, treatment of reserves and accumulated profits, adjustment of capital accounts and preparation of balance sheet.

·         Retirement and death of a partner: effect of retirement / death of a partner on change in profit sharing ratio, treatment of goodwill (as per AS 26), treatment for revaluation of assets and reassessment of liabilities, adjustment of accumulated profits and reserves, adjustment of capital accounts and preparation of balance sheet. Preparation of loan account of the retiring partner.

·         Calculation of deceased partner’s share of profit till the date of death. Preparation of deceased partner’s capital account and his executor’s account.

·         Dissolution of a partnership firm: meaning of dissolution of partnership and partnership firm, types of dissolution of a firm. Settlement of accounts – preparation of realization

preparation profit and loss appropriation account involving guarantee of profits.

·         develop the understanding and skill of making past adjustments.

·         state the meaning, nature and factors affectin goodwill

·         develop the understanding and skill of valuation of goodwill using different methods.

·         state the meaning of sacrificing ratio, gaining ratio and the change in profit sharing ratio among existing partners.

·         develop the understanding of accounting treatment of revaluation assets and reassessment of liabilities and treatment of reserves and accumulated profits by preparing revaluation account and balance sheet.

·         explain the effect of change in profit sharing ratio on admission of a new partner.

·         develop the understanding and skill of treatment of goodwill as per AS-26, treatment of revaluation of assets and re-assessment of liabilities, treatment of reserves and accumulated profits, adjustment of capital accounts and preparation of balance sheet of the new firm.

·         explain the effect of retirement / death of a partner on change in profit sharing ratio.

·         develop the understanding of accounting treatment of goodwill, revaluation of assets and re-assessment of liabilities and adjustment of accumulated profits and reserves on retirement / death of a partner and capital adjustment.

·         develop the skill of calculation of deceased partner’s share till the time of his death and prepare deceased partner’s executor’s account.

·         discuss the preparation of the capital

account, and other related accounts: capital accounts of partners and cash/bank a/c (excluding piecemeal distribution, sale to a company and insolvency of partner(s)).

Note:

(i)  The realized value of each asset must be given at the time of dissolution.

(ii) In case, the realization expenses are borne by a

partner, clear indication should be given regarding the payment thereof.

accounts of the remaining partners and the balance sheet of the firm after retirement / death of a partner.

·         understand the situations under which a partnership firm can be dissolved.

·         develop the understanding of preparation of realisation account and other related accounts.

Units/Topics

Learning Outcomes

Accounting for Share Capital

·         Share and share capital: nature and types.

·         Accounting for share capital: issue and allotment of equity and preferences shares. Public subscription of shares – over subscription and under subscription of shares; issue at par and at premium, calls in advance and arrears (excluding interest), issue of shares for consideration other than cash.

·         Concept of Private Placement and Employee Stock Option Plan (ESOP).

·         Accounting treatment of forfeiture and re- issue of shares.

·         Disclosure of share capital in the Balance Sheet of a company.

Accounting for Debentures

·         Debentures: Issue of debentures at par, at a premium and at a discount. Issue of debentures for consideration other than cash; Issue of debentures with terms of redemption; debentures as collateral security- concept, interest on debentures. Writing off discount / loss on issue of debentures.

After going through this Unit, the students will be able to:

·         state the meaning of share and share capital and differentiate between equity shares and preference shares and different types of share capital.

·         understand the meaning of private placement of shares and Employee Stock Option Plan.

·         explain the accounting treatment of share capital transactions regarding issue of shares.

·         develop the understanding of accounting treatment of forfeiture and re-issue of forfeited shares.

·         describe the presentation of share capital in the balance sheet of the company as per schedule III part I of the Companies Act 2013.

·         explain the accounting treatment of different categories of transactions related to issue of debentures.

·         develop the understanding and skill of writing of discount / loss on issue of debentures.

·         understand the concept of collateral security and its presentation in balance sheet.

·         develop the skill of calculating interest on

Note: Discount or loss on issue of debentures to be written off in the year debentures are allotted from Security Premium Reserve (if it exists) and then from Statement of Profit and Loss as Financial Cost (AS 16).

·         Redemption of debentures-Methods: Lump sum, draw of lots.

·         Creation of Debenture Redemption Reserve.

Note: Related sections of the Companies Act, 2013 will apply.

debentures and its accounting treatment.

·         state the meaning of redemption of debentures.

·         develop the understanding of accounting treatment of transactions related to redemption of debentures by lump sum, draw of lots and Creation of Debenture Redemption Reserve.

Units/Topics

Learning Outcomes

Financial statements of a Company:

Statement of Profit and Loss and Balance Sheet in prescribed form with major headings and sub headings (as per Schedule III to the Companies Act, 2013)

Note: Exceptional items, extraordinary items and profit (loss) from discontinued operations are excluded.

·         Financial Statement Analysis: Objectives, importance and limitations.

·         Tools for Financial Statement Analysis: Comparative statements, common size statements, cash flow analysis, ratio analysis.

·         Accounting Ratios: Meaning, Objectives, classification and computation.

·         Liquidity Ratios: Current ratio and Quick ratio.

·         Solvency Ratios: Debt to Equity Ratio, Total Asset to Debt Ratio, Proprietary Ratio and Interest Coverage Ratio.

·         Activity Ratios: Inventory Turnover Ratio, Trade Receivables Turnover Ratio, Trade

After going through this Unit, the students will be able to:

·         develop the understanding of major headings and sub-headings (as per Schedule III to the Companies Act, 2013) of balance sheet as per the prescribed norms / formats.

·         state the meaning, objectives and limitations of financial statement analysis.

·         discuss the meaning of different tools of ‘financial statements analysis’.

·         develop the understanding and skill of preparation of comparative and common size financial statements.

·         state the meaning, objectives and significance of different types of ratios.

·         develop the understanding of computation of current ratio and quick ratio.

·         develop the skill of computation of debt equity ratio, total asset to debt ratio, proprietary ratio and interest coverage ratio.

·         develop the skill of computation of inventory

turnover ratio, trade receivables and trade payables ratio and working capital turnover

Payables Turnover Ratio and Working Capital Turnover Ratio.

·         Profitability Ratios: Gross Profit Ratio, Operating Ratio, Operating Profit Ratio, Net Profit Ratio and Return on Investment.

ratio.

·         develop the skill of computation of gross profit ratio, operating ratio, operating profit ratio, net profit ratio and return on investment.

Units/Topics

Learning Outcomes

·         Meaning, objectives and preparation (as per AS 3 (Revised) (Indirect Method only)

Note:

(i) Adjustments relating to depreciation and amortization, profit or loss on sale of assets including investments, dividend (both final and interim) and tax.

(ii)  Bank overdraft and cash credit to be treated as short term borrowings.

(iii)  Current Investments to be taken as Marketable securities unless otherwise specified.

After going through this Unit, the students will be able to:

·         state the meaning and objectives of cash flow statement.

·         develop the understanding of preparation of Cash Flow Statement using indirect method as per AS 3 with given adjustments.