ICAI New Scheme of Education and Training CA Foundation Course Syllabus:
The Institute of Chartered Accountants of India ( ICAI ) has designed a comprehensive syllabus for the CA Foundation Course, aimed at equipping aspiring chartered accountants with a strong foundation in accounting, business laws, quantitative aptitude, and business economics.
The CA Foundation Exams for the Institute of Chartered Accountants of India ( ICAI ) will begin on the 14th of June 2024.
Want to Clear CA Foundation Exam? A sneak peek at CA Foundation Exam
In a crucial update for aspiring Chartered Accountants, the Institute of Chartered Accountants of India ( ICAI ) has officially announced that the last date for registration for the June 2024 CA Foundation Exam is February 1st.
The CA Foundation Course comprises four papers, each focusing on essential aspects of accounting, business laws, quantitative aptitude, and business economics. The syllabus is designed to provide a holistic understanding of fundamental concepts and principles. It is important that the students give adequate preference to each area, depending on the weightage of marks for the Chartered Accountancy Foundation Exam, June 2024.
Here’s a brief overview of each paper:
Paper 1: Accounting ( 100 Marks ):
Covers theoretical frameworks, accounting processes, bank reconciliation, inventories, depreciation, bills of exchange, preparation of final accounts, and more.
Emphasises the application of accounting principles in real-world scenarios.
Paper 2: Business Laws ( 100 Marks ):
Examines Indian regulatory frameworks, the Indian Contract Act, Sale of Goods Act, Partnership and LLP Act, Companies Act, and the Negotiable Instruments Act.
Aims to develop a comprehensive understanding of various forms of businesses and their legal implications.
Paper 3: Quantitative Aptitude ( 100 Marks ):
Divided into Business Mathematics, Logical Reasoning, and Statistics.
Focuses on mathematical and statistical tools, logical reasoning skills, and their application in business, finance, and economics.
Paper 4: Business Economics ( 100 Marks ):
Explores the concepts of demand and supply, production and cost, market structures, determination of national income, business cycles, public finance, money market, international trade, and the Indian economy.
Equips candidates with economic theories and their practical implications in the business world.
As candidates progress through this well-structured syllabus, they will not only build a solid foundation for their professional journey but also gain the knowledge and skills necessary to navigate the complexities of the accounting and business world. The ICAI CA Foundation New Scheme Syllabus stands as a crucial stepping stone towards becoming a proficient and ethical chartered accountant.
PAPER – 1: ACCOUNTING ( 100 MARKS )
Objective: To develop an understanding of the basic concepts and principles of accounting and apply the same in preparing financial statements and simple problem-solving.
Contents Section-wise Weightage:
1. Theoretical Framework ( 5%-10% )
– Meaning and scope of accounting
– Accounting Concepts, principles, and conventions
– Capital and revenue expenditure, capital and revenue receipts, contingent assets, and contingent liabilities
– Accounting policies
– Accounting as a measurement discipline – valuation principles, accounting estimates
– Accounting Standards – concepts and objectives
2. Accounting Process ( 30%-35% )
– Recording accounting transactions: principles of double-entry book-keeping
– Preparation of trial balance
– Rectification of errors
Bank Reconciliation Statement
– Introduction, reasons, and preparation of bank reconciliation statement
Inventories
– Meaning, Basis, and technique of inventory valuation
– Cost of Inventory, Net Realizable value, and Record System
Depreciation and Amortization
– Tangible and Intangible assets – Meaning and difference, concepts, methods of computation, and accounting treatment of depreciation/amortization, change in depreciation method
Bills of Exchange and Promissory Notes
– Meaning of bills of exchange and promissory notes and their accounting treatment; accommodation bills
3. Preparation of Final Accounts of Sole Proprietors ( 20%-25% )
– Elements of financial statements, closing adjustment entries, trading account, profit and loss account, and balance sheet of manufacturing and non-manufacturing entities
Financial Statements of Not-for-Profit Organizations
– Significance and preparation of receipt and payment account, income and expenditure account, and balance sheet, difference between profit and loss account and income and expenditure account
Accounts from Incomplete Records (excluding preparation of accounts based on ratios)
4. Partnership and LLP Accounts ( 15%-20% )
– Final accounts of partnership firms and LLPs
– Admission, retirement, and death of a partner including treatment of goodwill
– Dissolution of partnership firms and LLPs including piecemeal distribution of assets
5. Company Accounts ( 15%-25% )
– Definition of shares and debentures
– Issue of shares and debentures, forfeiture of shares, re-issue of forfeited shares
– Redemption of preference shares and debentures ( excluding purchase and redemption of own debentures and sinking fund method )
– Accounting for bonus issue and right issue
PAPER – 2: BUSINESS LAWS ( 100 MARKS )
Objective: To develop general legal knowledge of the law of Contracts, Sales, and understanding of various forms of businesses and their functioning to regulate the business environment and to acquire the ability to address basic application-oriented issues.
Contents Sections-Wise Weightage:
1. Indian Regulatory Framework ( 0%-5% )
– Major Regulatory Bodies such as the Ministry of Finance, Ministry of Corporate Affairs, SEBI, RBI, IBBI, Ministry of Law and Justice, etc.
2. The Indian Contract Act, 1872 ( 20%-30% )
– General nature of contract, consideration, other essential elements of a valid contract
– Performance of contract, breach of contract, contingent and quasi-contract, contract of indemnity and guarantee, contract of bailment and pledge, contract of agency
3. The Sale of Goods Act, 1930 ( 15%-20% )
– Formation of the contract of sale, conditions and warranties, transfer of ownership and delivery of goods, unpaid seller and his rights
4. The Indian Partnership Act, 1932 ( 15%-20% )
– General Nature of Partnership, rights and duties of partners, reconstitution of firms, registration and dissolution of a firm
5. The Limited Liability Partnership Act, 2008 ( 5%-10% )
– Introduction-covering nature and scope, essential features, characteristics of LLP, incorporation, and differences with other forms of organisations
6. The Companies Act, 2013 ( 15%-20% )
– Essential features of the company, corporate veil theory, classes of companies, types of share capital
– Incorporation of the company, memorandum of association, articles of association, doctrine of indoor management
7. The Negotiable Instruments Act, 1881 ( 10%-15% )
– Meaning of negotiable instruments, characteristics, classification of instruments, different provisions relating to negotiation
– Presentment of instruments, rules of compensation
Note: If new legislations are enacted in place of the existing legislations, the syllabus would include the corresponding provisions of such new legislations with effect from dates notified by the Institute.
The specific inclusions/exclusions in the various topics covered in the syllabus will be affected every year by way of Study Guidelines, if required.
PAPER –3: QUANTITATIVE APTITUDE ( 100 Marks )
Objective:
(a) To develop an understanding of the basic mathematical and statistical tools and apply the same in business, finance, and economic situations.
(b) To develop logical reasoning skills.
The whole syllabus of Quantitative Aptitude shall be divided into three broad areas:
– Business Mathematics
– Logical Reasoning
– Statistics
Contents Section-Wise Weightage:
Business Mathematics ( 40 Marks ) ( 20%-30% )
1. Ratio and Proportion, Indices and Logarithms:
– Ratio and proportion and time and work-related problems
– Laws of indices, exponents and logarithms, and anti-logarithms.
2. Equations:
– Linear simultaneous linear equations up to three variables
– Quadratic and cubic equations in one variable. Applications in business-related problems.
3. Linear Inequalities:
– Linear inequalities in one and two variables and the solution space
Mathematics of Finance: ( 30%-40% )
– Simple Interest
– Compound interest
– Nominal and Effective Rate of Interest
– Present Value
– Net Present Value
– Future Value
– Perpetuity
– Annuities
– Sinking Funds
– Calculating of EMI
– Calculations of Returns: Nominal and Effective rate of Return
– Compound Annual Growth Rate ( CAGR )
Basic Mathematics ( 30%-50% )
Permutations and Combinations
– Basic concepts of permutations and combinations
– Introduction, the factorial, permutations, results, circular permutations, permutations with restrictions, combinations with standard results.
Sequence and Series:
– Introduction sequences, series, arithmetic and geometric progression, relationship between AM and GM, and sum of n terms of special series and business applications.
Sets, Relations, and Functions:
– Basics of limits and continuity functions.
Basic Applications of Differential and Integral Calculus in Business and Economics:
– Excluding the trigonometric applications
Logical Reasoning ( 20 Marks ) ( 20%-30% )
Statistics ( 40 Marks ) ( 45%-50% )
Unit 1: Statistical Representation of Data, Diagrammatic Representation of Data, Frequency Distribution, Graphical Representation of Frequency Distribution
– Histogram, Frequency Polygon, Ogive, Pie-chart.
Unit 2: Sampling:
– Basic principles of sampling theory, comparison between sample survey and complete enumeration
– Some important terms associated with sampling types of sampling, sampling and non-sampling errors.
Measures of Central Tendency and Dispersion:
– Mean, Median, Mode, Mean Deviation, Quartiles and Quartile Deviation, Standard Deviation, Coefficient of Variation, Coefficient of Quartile Deviation
Probability ( 25%-30% )
– Independent and dependent events; mutually exclusive events
– Total and Compound Probability and Bayes’ theorem.
Theoretical Distributions:
– Random variables, Discrete and Continuous Random variables
– Expectation of a discrete random variable
– Theoretical Distributions: Binomial Distribution, Poisson distribution – basic application, and Normal Distribution – basic applications
Correlation and Regression ( 10%-15% )
– Scatter diagram, Karl Pearson’s Coefficient of Correlation
– Rank Correlation, Regression lines, Regression equations, Regression coefficients
Index Numbers ( 10%-15% )
– Uses of Index Numbers
– Problems involved in construction of Index Numbers
– Methods of construction of Index Numbers. BSE SENSEX and NSE
PAPER – 4: BUSINESS ECONOMICS ( 100 Marks )
Objective: To develop an understanding of the concepts and theories of Economics and to acquire the ability for addressing application-oriented issues.
Contents Section-Wise Weightage:
1. Introduction to Business Economics ( 5% )
– Meaning and scope of Business Economics
– Basic Problems of an Economy and Role of Price Mechanism
2. Theory of Demand and Supply ( 10% )
– Meaning and Determinants of Demand
– Law of Demand and Elasticity of Demand – Price, Income, and Cross Elasticity
– Theory of Consumer’s Behaviour – Indifference Curve approach
– Meaning and Determinants of Supply
– Law of Supply and Elasticity of Supply
– Market Equilibrium and Social Efficiency
3. Theory of Production and Cost ( 10% )
– Meaning and Factors of Production, Short Run, and Long Run
– Law of Production – The Law of Variable Proportions and Laws of Returns to Scale, Producer’s Equilibrium
– Concepts of Costs – Short-run and long-run costs, Average and Marginal Costs, Total, Fixed and Variable Costs
4. Price Determination in Different Markets ( 15% )
– Market Structures: Perfect Competition, Monopoly, and Monopolistic Competition
– Using Game Theory to study Oligopoly
– Price Determination in these Markets
– Price-Output Determination under different Market Forms
5. Determination of National Income ( 15% )
– Macro Economic Aggregates and Measurement of National Income
– Determination of National Income: Keynes’ Two Sector Basic Model, Three Sectors and Four Sectors Models
6. Business Cycles ( 5% )
– Meaning, Phases, Features, Causes behind these Cycles
7. Public Finance ( 10% )
– Fiscal functions: An Overview, Centre and State Finance
– Market Failure/Government intervention to correct market failure.
– Process of budget making: Sources of Revenue, Expenditure Management, and Management of Public Debt.
– Fiscal Policy
8. Money Market ( 10% )
– Concept of Money Demand
– Important theories of Demand for Money
– Concept of Money Supply, Cryptocurrency, and other new terminology
– Monetary Policy
9. International Trade ( 10% )
– Theories of International Trade including theories of intra-industry trade by Krugman.
– Trade Policy – The Instruments of Trade Policy
– Trade Negotiations
– Exchange Rates and its economic effects
– International Capital Movements: Foreign Direct Investment
10. Indian Economy ( Before 1950-Chanakya and Nand Vansh, OECD Paper ( 1950-1991 ), Basic knowledge 1991 Onwards (10% )
Note: A deviation of maximum ±5% in the specified section-wise weightage is permitted.
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