Preparation of financial reporting

Gagan Somani (Chartered Accountant) (150 Points)

10 February 2016  

Hi Friends,

Hope most of you have already decided your exam decision and if you do not then decide as soon as possible.

This time this article is all about preparations of Financial Reporting. FR paper is scoring one and obviously one of supporting papers for clearing exams. So proper planning needed in this paper.

FR is divided into 4 parts:-

  1. AS & Ind As(35-40 marks)
  2. Holding (16 marks)
  3. Amalgamation + Valuation(24-32 marks)
  4. Share based payments + VAS + Others(16-20 marks)

According to me 1, 3 & 4 are most important and first preference chapters.

Holding is alternative one (in case you don’t have any choice), don’t take this chapter seriously because this is a time wasting chapter and recommended only for those who can hold anything. I am not saying that leave this chapter but do this chapter only to the extent your concepts are ok. Don’t fall in love with this chapter because it always fight in the exam time. Do holding as per list of topics, 2 or 3 questions from each topic like basic, Chain holding, Inter- company holding, Disposal of shares, Hire purchase, Updation etc. Don't do morethan 20-25 question for this chapter.

IndAs- a confusing topic for everyone. This video link will definitely help you.

https://www.youtube.com/watch?v=i0QNDFbkRcs

AS- the most important and lengthy part as well. Divide the AS in 4 parts-

  1. Difficult (11,15,19,20,22)
  2. Easy but time consuming(7,16,26,28)
  3. Conceptual(4,5,9,24,29)
  4. Easy (1,2,3,6,10,12,13,17,18,25)

14,21,23,27 are part of chapters.

If you want to score more marks then try to learn para numbers. You can learn para number by Definition, Main Content and Disclosure part. For e.g. AS 7 – definition para 2-5, Main content para 21-34, Disclosure para 38-44. You can refer Sharma sir’s pdf slides for theory and concepts of AS.

Amalgamation, Valuation, Share based payments, VAS and remaining one are scoring and practice oriented chapters so take these chapters very seriously. Remember you should have to prepare B/s and Notes to accounts for minimum 3-5 questions. 

Amalgamation has following types of question-Net payment method, Net asset method, Inter Company Holding, Entries+ Realisation Account, Demerger, Buyback, Merger, Intrinsic value, Sale of division. Do topic wise questions because it gives you better understanding.

For other chapters you can do whatever you like to do.

For AS you should go for PM + Sharma sir Questions+ RTP of last 2-3 Attempts. For remaining chapters PM is sufficient study material and no need to do further preparation.

You can contact me on cagagansomani @ gmail.com for further information or the information you did not get through this article.

All the best.

Thanks & Regards
CA Gagan Somani