Company Accounts and Cost and Management Accounting :: CS Group

CS_Group-I : Paper 2 : [One paper: Three hours - 100 marks]

Level of Knowledge : Working knowledge.

Objectives.

To provide working knowledge of accounting principles and procedures for corporate entities in accordance with the statutory requirements.
To acquaint the students with cost and management accounting techniques and practices.

Detailed Contents . . .

Part A: Company Accounts [50 Marks]

Statutory records to be maintained by a company.
Accounting standards - relevance and significance; national and international accounting standards.
Accounting for share capital transactions - issue of shares at par, at premium and at discount; forfeiture and re-issue of shares; buy-back of shares; redemption of preference shares - statutory requirements, disclosure in balance sheet; rights issue.
Issue of debentures - accounting treatment and procedures; redemption of debentures; conversion of debentures into shares.
Underwriting of issues; acquisition of business; profits prior to incorporation; treatment of preliminary expenses.
Preparation and presentation of final accounts of joint stock companies as per company law requirements; provisions and reserves; determination of managerial remuneration; appropriation out of profits; transfer of profits to reserves; payment of dividend, transfer of unpaid dividend to Investor Education and Protection Fund; bonus shares and payment of interest out of capital.
Accounting treatment for amalgamation and reconstruction of companies; internal reconstruction.
Holding and subsidiary companies - accounting treatment and disclosures; consolidation of accounts.
Valuation of goodwill and shares.
Final accounts of banking companies, insurance companies and electricity companies.
Overview of financial reporting in respect of various kinds of financial institutions like mutual funds, non-banking finance companies, merchant bankers, stock brokers, etc.
Computerised accounting; accounting softwares; accounting applications using DBMS; role of computers in accounting.

Readings

Sultan Chand & Company Ltd; Ram Nagar, New Delhi - 110055
1. Advanced Accounts Vol. II
  - M.C. Shukla, T. S. Grewal & S. C. Gupta
Sultan Chand & Sons, 23, Darya Ganj, New Delhi – 110002.
1. Company Accounts
  - R. L. Gupta & M. Radhaswamy
Vikas Publishing House (Pvt) Ltd; 576, Masjid Road, Jangpura, New Delhi – 110014
1. Corporate Accounting
  - S.N. Maheshwari
Kalyani Publishers, 24, Daryaganj, New Delhi – 110002.
1. Company Accounts
  - S.P Jain & K.L Narang
Mayoor Paperbacks, A – 95, sector 5, Noida – 201 301.
1. Fundamentals of Corporate Accounting
  - J. R. Monga

Reference

Taxman’s, New Delhi
1. Accounting Standards and Corporate Accounting
  - T.P Ghosh
Snow White Publications, Mumbai
1. Accounting Standards and Corporate Practices
  - Sanjiv Agarwal
Financial Times Professional Ltd; London.
1. Business Accounting – 2
  - Frank wood & Alan Sangster
Kamal Law House, Kolkata
1. A Guide to Company Balance Sheet, Profit & Loss Account with Different Types of Accounting Methods
  - Anil B. Roy Chowdhary

Other Relevant Books

Part B: Cost and Management Accounting [50 Marks]

Introduction – objectives of costing system; cost concepts and cost classification; establishing costing system; management accounting – meaning, nature and scope; role of management accountant, tools and techniques of management accounting; distinction between financial accounting, cost accounting and management accounting.
Elements of cost: –
1. Material cost — purchase procedures, store keeping and inventory control, fixing of minimum, maximum and re-order levels, ABC analysis, pricing of receipts and issue of material and accounting thereof, investigation and corrective steps for stock discrepancies; accounting and control of wastage, spoilage and defectives.
2. Labour cost — classification of labour costs, payroll procedures, labour analysis; monetary and non-monetary incentive schemes; measurement of labour efficiency and productivity; labour turnover and remedial measures; treatment of idle time and overtime.
3. Direct expenses — nature, collection and classification of direct expenses and its treatment.
4. Overheads — nature, classification, collection, allocation, apportionment, absorption and control of overheads.
Reconciliation of cost and financial accounts.
Methods of costing – output or unit costing; job and batch costing; operating costing; contract costing; process costing – treatment of by-products and joint products.
Budgetary control – Preparation of various types of budgets, advantages and limitations; budgetary control reports to management; zero base budgeting; performance budgeting.
Standard costing and variance analysis – standard costing distinguished from budgetary control; types of standards, determination of standards, variance analysis; disposal and reporting of variances to management.
Marginal costing and break-even analysis – Marginal costing distinguished from absorption costing; application of marginal costing; contribution concept and decision making; cost-volume-profit relationship; break-even analysis, preparation of break-even charts, profit – volume graph; practical application of profit volume ratio.
Analysis and interpretation of financial statements – nature, objectives; latest trends in presenting financial data; importance and limitations; types and tools of financial statement analysis; accounting ratios - classification, advantages and limitations; inter firm comparisons.
Cash flow statements – classification of cash flows, preparation and usefulness.
Accounting for price level changes – inflation accounting, limitations of historical cost accounting, methods of accounting for changing prices.
Responsibility accounting – Basic principles, centers of control; responsibility reporting, implementation, organisational aspects, benefits and difficulties; management reporting system; behavioural consideration in accounting; social reporting.

Readings

Vikas Publishing House (Pvt) Ltd; 576, Masjid Road, Jangpura, New Delhi – 110014
1. Cost Accounting
  - M.N Arora
2. Management Accounting
  - I. M Pandey
Kalyani Publishers, 24, Daryaganj, New Delhi – 110002.
1. Cost and Management Accounting
  - S. P Jain & K.L Narang
Tata Mc Graw Hill Publishing Co. Ltd; New Delhi
1. Management Accounting
  - M. Y. Khan & P. K Jain
Pearson Education Asia, 482, F. I. E. Pataparganj, Delhi – 110092.
1. Cost Accounting – A Management Emphasis
  - C. T. Horngren
2. Management Accounting
  - Atkinson, Banker, Kaplan & Young
Sultan Chand & Sons., New Delhi
1. Cost and Management Accounting
  - S. N Maheshwari
2. Cost and Management Accounting
  - V. K Saxena & C. D Vashist
Shuchita Prakashan (P) Ltd; Allahabad.
1. Cost Accounting
  - N. K Agarwal

Reference

Book Syndicate (p) Ltd, Kolkata
1. Principles and Practice of Cost Accounting
  - N. K Parsed
Sultan Chand & Sons, New Delhi.
1. Cost and management Accounting
  - C.T Horngren
Taxman’s, New Delhi
1. Advanced Management Accounting
  - Ravi M. Kishore
Tata McGraw Hill Publishing Co. Ltd. New Delhi
1. Theory and Problems of Management and Cost Accounting
  - M.Y. Khan & P.K Jain
2. Managerial Accounting
  - Garrison & Norren
Pearson Education Asia, 482, F.I.E. Patparganj. Delhi
1. Advanced Management Accounting
  - Kaplan & Atkinson
2. Cost and management Accounting
  - Duncan Williamson
South Western College Publishing. Ohio. U.S.A
1. Management Accounting
  - R. Hanson Don
2. Advanced Management Accounting
  - L. Hiresh Maurice
3. Managerial Accounting
  - Hansen & Mowen
International Thomson Business Press, London
1. Management and Cost Accounting
  - Drury Colin