Hi Friends. I want to thank all of you from the bottom of my heart for your kind words and appreciation. Please accept my sincere apology for the delay in posting this article, but I was helpless as I had other professional commitments. Most of us consider CA FINAL GROUP 2 as a burden because we think it consists of Dangerous DT, Confusing COST and Irritating ISCA (I did not mention IDT because it seems that students find it manageable). Well it’s indeed tough because you need to have good memory (to learn ISCA), good understanding of tax papers and analytical abilities for Costing & OR. However it`s not impossible because all of you have these qualities, you just have to believe in yourself and give it your best shot.
Now coming to the main point, what is the strategy for clearing GROUP 2?
Let me clarify at the outset that by strategy I don’t mean selective studying .Each and every chapter/topic in CA final is important and in exam questions can be asked from anywhere .However we can cover some topics in detail or before other topics and ensure that we attempt 60-65 % of the paper with full accuracy.
Before I share with you some tips for GROUP 2 preparation, let me talk about the REVISION TEST PAPERS. These are important for both groups because more often than not questions in final exams are from the RTP`s. Ideally after finishing a chapter in any subject you must try to solve the questions from that chapter given in previous years RTP`s.(In my case most of the coaching teachers had incorporated RTP questions in their study materials itself). If you have less time than you should at least solve current term`s RTP along with previous 2-3 term`s RTP. Don’t leave this for the 11th hour because you may have doubts regarding few questions and their solutions given in the RTP`s. Plan your studies accordingly so that you have time to resolve all your doubts. One more thing, start your preparation for all subjects (including theory subjects) as early as possible so that you can at least revise whatever you have already read!
Let us discuss paper wise tips for GROUP 2 :-
1. Paper 5: Advanced Management Accounting (costing and operational research/quantitative techniques)
While preparing for costing try to understand the concepts and their applications because new questions can be asked (by new I mean questions may not be repeated from past papers, practice manual or coaching teacher`s notes! I clearly remember a question on Reverse assignment was asked in MAY 11 exam and after exam was over all the students were shouting yeh question toh out of syllabus hai!) I would suggest one should take coaching from a competent teacher who explains the underlying concepts and not just teaches methods to solve a problem. In case you don’t have time or money or both then you can opt for self study by following ICAI STUDY MAT ALONGWITH SAXENA VASHISHT or PC TULSIAN or any other good book. {I personally did not like PADHUKA because it just has solutions without much explanation. Moreover I do not have firsthand experience of other reference books (I had taken coaching) so please make your own informed choice.}
Here is topic wise list in order of preference:
i. QUANTITATIVE TECHNIQUE (QT aka OR) - Prepare all the topics of Qt well. Revise it from practice manual/past papers etc. DO COVER THEORY OF QT AFTER FINISHING PRACTICAL PROBLEMS .Among the topics Formation of linear Programming equation, Assignment, Transportation, simulation, Network analysis(PERT/CPM), learning curve are important.
ii. RELEVANT COSTING
iii. CVP ANALYSIS OR MARGINAL COSTING and
iv. DECISIONS MAKING SUMS BASED ON above CONCEPTS (make or buy, continue or shutdown, evaluation of profitability or proposals etc.)
v. TRANSFER PRICING
vi. ACTIVITY BASED COSTING
vii. PRICING DECISIONS
viii. MISCELLANEOUS TOPICS LIKE SERVICE SECTOR COSTING, TARGET COSTING, LIFE CYCLE COSTING, JIT, MRP, & ERP,TQM, VALUE CHAIN ANALYSIS, PARETO ANALYSIS (These topics are very important from theory point of view. As far as practical questions are considered practice 4-5 different variety of question from each of these MISC topics and that should be enough).
ix. Budgeting Control and Performance Measurement
x. Standard Costing
Last but not the least start reading THEORY questions (either from Practice manual or some other notes) related to a topic as and when you finish practical problems of that topic. DON`T LEAVE COSTING THEORY FOR THE LAST MINUTE.
2. Paper 6: Information Systems Control and Audit - Well what I can say about this great paper! Most of the time we complain why we have to study ISCA? I want to become a CA not an IT professional etc. But the fact remains knowledge of IT is must in any field nowadays. If this does not motivates you let me add this is, by far the most scoring paper as virtually all the questions come from ICAI study mat and moreover with proper preparation and presentation you can get very high marks in exam.(if I am not wrong in recent past one candidate got 98 marks in isca!!) So bottom-line is YOU CAN LOVE ISCA OR HATE ISCA BUT CERTAINLY CANNOT IGNORE ISCA!
You can study ISCA from ICAI study material + Manish M Valechha`s SELF STUDY GUIDE. The best part about this book is that it highlights the KEY WORDS (they are given in color) and also summarizes the study material beautifully. Another good feature of the book is that it has charts, diagrams and mnemonics which make learning ISCA easy. So you can give a quick reading to ICAI study material and follow it up next day from the Self Study guide to revise and retain the main topics. You may be tempted to use only this self study guide/other reference book for isca and leave ICAI Study material but do not do that because ONLY ICAI STUDY MATERIAL HAS THE TECHNICAL WORDS AND INDEPTH COVERAGE RELEVANT FOR ANSWERING IN THE EXAM. You can check out the practice manual for understanding the writing pattern. Mark the key words/technical terms, learn them and use these words in your answers. Other points you can write in your own language. For example – If a question comes on SEC 3 of IT ACT which deals with Digital signature you have to write the words ASYMMETRIC CRYPTO SYSTEM, PRIVATE KEY and PUBLIC KEY in your answer and briefly explain them. Then you can say it involves authentication of e-records by using technology of key pair.
List of chapters in order of preference:
i. Information system concepts
ii. Risk Assessment Methodology
iii. Enterprise Resource Planning (ERP)
iv. Business Continuing Planning / Disaster Recovery Planning
v. The Information Technology (amendment) Act 2008
vi. System Development Life cycle methodology
vii. IS Audit Standards-imp
viii. Drafting of IS Security Policy, Audit Policy, IS Audit Reporting - a practical perspective-imp
ix. Testing of controls
x. System Controls.
3. Paper 7: Direct Tax Laws
For direct taxes you can take coaching or do self study. VINOD GUPTA SIR`S MODULES are wonderful as they provide in depth analysis of every section and also have so many solved examples and past year`s questions.
If you have good foundation in direct tax it really helps. So if you have forgotten the basics which you learned in IPCC like heads of income (SPECIALLY CG AND PGBP), income from other sources, deductions under chapter VIA (sec 80 c to u), computation of GTI and tax liability etc. Do brush up these topics because most of tax books or teachers won`t be covering these topics in detail (They presume you know these things). Why I am saying this? Because at CA FINAL LEVEL you are expected to know the all DIRECT TAX LAWS (which includes IPCC TOPICS+CA FINAL ADVANCED LEVEL TOPICS). IN MAY 2011 THERE WAS A QUESTION ON SLUMP SALE. SIMILARLY IN EARLIER YAERS THEY HAVE ASKED QUESTION ON EXEMPTIONS UNDER SEC 54 -54H. QUESTIONS ON SALARY PERQUISITE VALUATION ARE ALSO COMMONLY ASKED. All these are covered at IPCC level itself!
CA final DT is not only about understanding so many provisions but also about writing proper answer in examination. Do quote section numbers, landmark judgments’ in your answer (Yes, You have to take extra efforts to learn these first, but it’s better than failing and wasting precious years of your life!) and give notes to your solution explaining applicable provisions.
Here is the order in which you may study:
i. WEALTH TAX ACT - Covers both practical sums and ASSESSMENT PROCEDURE (AP) under Wealth tax act. {AP under wealth tax is similar to that under IT act, just the section numbers are different. So you can do this part after completing AP under IT act}.
ii. CAPITAL GAINS, IMPLIACTIONS OF DEMERGER, AMALGAMTIONS, CONVERSION OF FIRM TO COMPANY ETC.
iii. PGBP, TAXATION OF FIRMS AND ITS PARTNERS, AMT for LLP, PRESUMPTIVE TAXATION ETC.
iv. SETOFF AND CARRY FORWARD OF LOSSES
v. DEDUCTION UNDER CH VIA( 80 IA, IAB, IB, IC, IE, LA, QQB, RRB) AND SEC 10 A, 10AA, 10B
vi. MINIMUM ALTERNATE TAX.
vii. ASSESSMENT PROCEDURE, APPEALS, REVISIONS, INCOME TAX AUTHORITIES AND THEIR POWERS.
viii. SURVEY, SEARCH AND SEIZURES
ix.TAXATION OF NON RESIDENTS AND DOUBLE TAXATION AVOIDANCE AGREEMENTS.
x. Advance ruling
xi. Settlement commission
xii. Transfer pricing
xiii. Tax deducted at source
xiv. TAXATION of dividends (includes deemed dividend), liquidation of companies, buyback of shares, reduction of share capital.
xv. TAXATION OF VARIOUS ENTITIES LIKE RELIGIOUS INSTITUTIONS, CHARITABLE TRUSTS, MUTUAL CONCERNS, AOP, BOI etc.
xvi. Advance tax
xvii. Interest u/s 234A, B, C, D AND 244A
xviii. Penalty and prosecution.
xix. Tonnage taxation and other Misc topics.
RECENT AMENDMENTS AND CASE LAWS ARE VERY IMPORTANT. YOU CAN REFER TO ICAI`S SUPPLEMENTARY MATERIAL AND RECENT CASE LAWS PUBLISHED BY IT
START READING THEM EARLY. EVEN IF YOU HAVE NOT COMPLETED A CHAPTER YOU CAN UNDERSTAND A CASE LAW BY SIMPLY FINDING THE MEANING OF ONLY THE PROVISIONS MENTIONED IN THE CASE LAW AND READING THE JUDGEMENT GIVEN IN THE CASE LAW
4. Paper 8 : Indirect Tax Laws
For indirect tax also you can take coaching or do self study from BANGAR N BANGAR/ NS GOVINDAN/AJAY JAIN`s BOOK or ANY OTHER GOOD BOOK.
Like DT here also writing style is very important .You may know the relevant concepts but you must express it properly in the exams to score high marks. You may check out complier or practice manual for understanding how to present your answer.
Here is the list of topics in order of preference:-
i. SERVICE TAX part 1 – Basic concepts, rules, procedures and valuation.
ii. SERVICE TAX part 2 – Classification of taxable services.
iii. VAT – theory + practical sums on VAT
iv. Central excise part 1 – Basic concepts, Valuation rules, Cenvat credit rules, SSI exemption notification 8/2003 (theory +sums on 150/400 lacs turnover calculation)
v. Central excise part 2 - Registration and payment of duty. (Central excise rules 8, 9 etc.)
vi. Central excise part 3 - Adjudication and appeal provisions (Sec11A, AC, B, unjust enrichment etc.)
vii. Central excise part 4 - export procedure under central excise.
viii. CUSTOMS ACT - basics, valuation, types of duties, import and export procedure.
ix. Common topics under excise, customs and service tax.
FOR CUSTOMS PRACTICAL SUMS ARE VERY IMPORTANT AS THEY CAN FETCH YOU VALUABLE 5-10 MARKS .SUMS ON FINDING ASSESSABLE VALUE (FOB, CIF, ETC) AND COMPUTING TOTAL CUSTOMS DUTY PAYABLE, SUMS ON DUTY DRAWBACK, ETC.
In IDT recent case laws, amendment and problem sums from all chapters are very important. RAJKUMAR SIR OF ETEN PROVIDES SEPARATE BOOK ON PROBLEM SUMS WHICH I FOUND VERY HELPFUL.
ALL THIS IS MY OPINION AND I MAY BE WRONG. SO IN CASE YOU DON’T AGREE WITH ME, FOLLOW YOUR OWN HEART.
THANKS AND ALL THE VERY BEST TO ALL OF YOU!
CA PRATIK JAIN
CAclubindia
