Student Journal-Jan 2016

The Institute of Chartered Accountants of India (Set up by an act of Parliament)Your monthly guide to CA news, information and events VOL 19 NO. 08 PAGES 36 JANUARY 2016 R50  02 January 2016 The Chartered Accountant Student CONTENTS President and Editor-in-chief CA. Manoj Fadnis, Indore Chairman and Editor CA. V. Murali, Chennai Addl. Secretary - Board of Studies CA. Vandana D. Nagpal Editorial Support K. Sudhakaran, Assistant Director Dr. Ruchi Gupta, Sr. Executive Offi cer Offi ce Board of Studies The Institute of Chartered Accountants of India, ICAI Bhawan, A-29, Sector-62, Noida-201 309. Phone : 0120-3045938 EDITORIAL BOARD President’s Communication Chairman’s Communication Motivation: Unlock Your Potential and Shape Your Destiny Article: Takeovers Are No Child’s Play Article: Swachh Bharat Cess Article: How to Approach Questions in Interviews Article: Anatomy of Learning: Leaning How to Learn Academic Update: Accounting Knowledge Update: Swachh Bharat Cess(SBC)-Frequently Asked Questions (FAQ) Knowledge Update: Auditor’s Qualifi ed Report on Consolidated Financial Statements under the Companies Act, 2013 Advisory: E-mail and Telephonic Queries: An Advisory for Students Announcements Poem 03 04 05 06 09 11 15 17 19 22 26 28 34 INSIDE DISCLAIMER: The ICAI is not in any way responsible for the result of any action taken on the basis of the advertisement published in the Journal. Cover Image Courtesy: www.shutterstock.com EDITOR: CA. V. Murali Printed and published by Shri Vijay Kapur, on behalf of The Institute of Chartered Accountants of India, New Delhi. PUBLISHED at the Institute’s Offi ce at Indraprastha Marg, New Delhi and printed at Spenta Multimedia Pvt. Ltd., Plot 15,16 & 21/1, Village Chikhloli, Morivali, MIDC, Ambernath (West), Dist. Thane The views and opinions expressed or implied in THE CHARTERED ACCOUNTANT STUDENT are those of the authors and do not necessarily refl ect those of ICAI. Unsolicited articles and transparencies are sent at the owner’s risk and the publisher accepts no liability for loss or damage. Material in this publication may not be reproduced, whether in part or in whole, without the consent of ICAI. Success in life is not about luck, it is about managed thoughts, focused attention and deliberate action. - Trudy Vesotsky, 2013 Check your Address: All students should check their mailing address printed on back cover. In case, there is any change or the PIN Code (Postal Index Code) is either missing or is incorrect, kindly inform immediately the concerned Regional Offi ce, giving full particulars of your address alongwith correct PIN Code. This would enable us to ensure regular and prompt delivery of the Journal. ANNUAL SUBSCRIPTION RATES CA Students Members and Others Overseas ` 200 ` 500 US $ 100 Total Circulation: 4,50,151 Correspondence with regard to subscription, advertising and writing articles Email: writesj@icai.in Non-receipt of Students’ Journal Email: nosj@icai.in HEAD OFFICE The Institute of Chartered Accountants of India, ICAI Bhawan, Indraprastha Marg, New Delhi-110 104. SWACHH BHARAT - A STEP TOWARDS CLEANLINESS The Chartered Accountant Student January 2016 03 PRESIDENT’S COMMUNICATION My Dear Students, H eartiest best wishes for a wonderful and prosperous New Year 2016. I wish that New Year provides the CA students zeal, enthusiasm and luck to scale new heights of success in all endeavours. I really take pride in the fact that each passing year our Institute is growing and gaining in strength. We have great onus on our shoulders to maintain the core values of accounting profession. New Year is the most appropriate time for all of us to take pledge that we will serve our society with utmost sincerity, honesty, transparency and thereby contribute in the overall development of the nation. I also extend my best wishes on the occasion of 67 th Republic Day of our beloved motherland. Th e celebration of this day instills such a patriotic fervor that truly refl ects our unity among diversity. Undoubtedly, the country is marching ahead to become new economic powerhouse. Notwithstanding Mid-Year Economic Review recently tabled in the Parliament has lowered the growth forecast to 7-7.5 per cent from 8.1-8.5 per cent in 2015-16, India will be amongst the top growing economies of the world. Th e Reserve Bank of India has cut interest rates in tranches this year to lower the borrowing costs and spur revival of investment cycle. I am very hopeful that our country will grow faster to enhance standard of living, have inclusive growth and improve employment. Th e government is pushing ahead with economic reforms with initiatives such as Make in India that should drive investment and induce further growth. Th e country is eagerly waiting for the new regime of Goods and Service Tax to become a reality that should catapult the growth rate. Th e growth of Chartered Accountancy profession has to be in tandem with the growth of our nation. India with its high growth rates require more number of highly skilled professionals equipped with contemporary practical knowledge. Already the skill-sets being imparted have extended from the traditional domains of accounting, fi nance, taxation and auditing to the emerging areas of business strategies, governance, sustainability, business consultancy and so on. Th e new scheme of education and training that is in the process of implementation shall surely press forward acquisition of skills sets that will improve both employability and entrepreneuring capability. In the current business environment, the probable employers prefer hiring those who have already acquired skills, as it cuts down the training time and cost to the company. In the Institute, this is achieved through well thought mix of theoretical education and practical training. Usable practical skills constitute the integral and indispensable part of our profession. “Th e mind is not a vessel to be fi lled, but a fi re to be kindled”, said Plutarch. Th e Institute does not encourage rote learning by the students; rather teach them to be ever interested and receptive to knowledge. Th is virtue is carried even after acquiring the qualifi cation in form of well planned Continuing Education Programme. I am very pleased to share that in this issue of the students’ journal, the Board of Studies is introducing a new column of Knowledge Update as a regular feature. It will cover recent trends and developments in diff erent areas of accounting, auditing, taxation, and company laws, etc. It gives me pleasure to inform that the Board of Trustees of Chartered Accountants’ Students Benevolent Fund (CASBF) has decided to grant fi nancial assistance to 800 meritorious and needy students (i.e. to 400 male and 400 female students), who are currently undergoing articled training for one year with eff ect from 1 st April 2015 to 31st March 2016. When we help students, we actually help transform our generation next, and when we empower our generation next, we actually secure our own future. In the month of January 2016, the results of CA examinations held in November, 2015 shall be declared. Best wishes to all the candidates. May your hard work is rewarded! We have one of the most robust evaluation processes in place in the interest of students. At the same time with the belief that improvement is always possible, we have made eff orts to further improve the processes so that no harm is done to a deserving student. I look forward to your joining the profession as Chartered Accountant very soon. With best wishes, CA. MANOJ FADNISPRESIDENT THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA 04 January 2016 The Chartered Accountant Student My Dear Students, W ishing you all a Happy, Prosperous and fulfi lling New Year 2016. Warm Sankranti and Pongal Greetings. We at the Board of Studies wish you all the very best for a wonderful year. May your eff orts bear fruit. Never forget two people in your life - your father and your mother. Th e person who loses everything to make you win – your father; Th e person who is with you in every pain – your mother. I am happy to share with you that the column of Knowledge Update, which has been started on pilot basis will be a regular feature of the Students’ Journal from this issue onwards. I sincerely hope that this eff ort of BOS - will bridge the gap between theory and practice. We have also subjected the Online Mentoring facility for a review at the Board of Studies. Based on the feedback of our faculty members as well as students, we have also decided to make available the online mentoring facility on the Cloud Campus on the diffi cult areas of the subject(s) for the three levels of the CA course including counseling. POINTS TO PONDER Talent wins games. But teamwork wins championships. Team building, networking and relationship building are the keys to success. Use your voice for kindness; your ears for compassion; your hands for charity; your mind for truth; and your heart for love. Don’t cry over the past, it is gone; Don’t stress about the future, it has not arrived; live in the present and make it beautiful. Calmness of mind is one of the rarest and beautiful jewels of wisdom. Th e most important time to hold your temper is when the other person has lost it. A French Proverb says “Th ere is no pillow as soft as a clear conscience.” We are born to be real and not to be perfect. Creative thinking inspires ideas, ideas inspire change. Happiness can be found even in the darkest of times, if one remembers to turn on the light. Th e secret of success lies in our perception of our work. If we perceive what we are doing as a struggle, then, whatever, we do will seem diffi cult. If we visualise ourselves as overcoming the minor obstacles in our path, we will surely be winners. It is for us to look for and grab the opportunities. We must not be passive onlookers, but pro-active and creative. Attitude matters, self perception counts, harmony with oneself and energizing oneself is the key to get ahead. Henry David Th oreau said “Success usually comes to those who are too busy looking for it.” It is said that the road to success is always under construction and it is self-motivation that will cruise you through the journey of life. A Comfort zone is a beautiful, cozy and comfortable place – but nothing ever grows there. Hence, come out of your comfort zone and enter into eff ort zone. When you feel low and down, remember no matter what the problem is don’t nurse it, don’t curse it, don’t even regret it, just gladly accept it, trust God – He will reverse it! In life, never to get ‘upset’ about any issue or problem, it will never sort the issue rather complicate it. Getting ‘Up’ to ‘Set’ things right will help you in life. SUCCESS MANTRA1. Successful people are simply those with successful habits. 2. Success is not a mystery, it is a science. 3. Successful people build each other up. Th ey motivate, inspire and push each other. Unsuccessful people just hate, blame and complain. 4. A defi nitive aim in life will save wasted eff ort and give direction in life. 5. Self confi dence will help one master all fears that wrack a person – fear of ill health, fear of poverty, fear of criticism, fear of death and fear of loss of love. 6. Enthusiasm will enable one to move freely with all those one comes in contact with and is the foundation of a pleasing personality. 7. Self-control is very important to help balance oneself in a practical manner to become “the master of your fate, the captain of your soul.” 8. Imagination and the habit of doing more: Creativity is a prized commodity. A person with ideas is always looked up to. So is a person who is willing to go the extra mile in pursuit of the goal. EFFORT AND PERSEVERENCE HOLD THE KEYAs a student of the Chartered Accountancy Course, it is imperative to be diligent in study, put in regular eff ort and persevere steadily – relentless toil is the key to crack the examinations. Concentration is the act of focusing the mind upon a set goal and working towards it till one attains success. You have the power to turn minus into plus. Look forward, never backward. Forge your way with persistence and perseverance. You are sure to emerge successful. Never stop giving your best, just because someone does not give you your due credit. Abraham Lincoln has said “Th e best way to predict your future is to create it.” Keep doing what you can and God will do what you can’t. Good or bad, just smile. You have a lot to be thankful for. Don’t lose hope. You never know what tomorrow has in store for you. Life’s best moments usually happen unexplained. When you feel like quitting, think about why you joined. Dreams don’t work unless you do. Never overestimate your weakness or underestimate your strength. Your struggles will lead you to your strengths. You have to fi ght through some bad days to earn the best days of your life. WRAP UP POINT Take care of your thoughts when you are alone and take care of your words when you are with people. Life ends when you stop dreaming; Hope ends when you stop believing; Love ends when you stop caring. Always remember that you are much more than you know. Within you lie great reserves, the promise of a better tomorrow. It is up to you to rise over and above your circumstances, to make an indelible impression and mark in your chosen area. Most people don’t achieve their dreams. Th ey quit or give up just steps away from the fi nishing line. Have the tenacity and will to stick to your plan till you reach the goal. Shri Robin Sharma said “the only limits on your life are the ones you set yourself. When you dare to go out of your circle of comfort and explore the unknown, you start to liberate your true human potential.” Th e great comedian Charlie Chaplin said “Life laughs at you when you are unhappy; Life smiles at you when you are happy; but Life salutes you when you make others happy.” Trust before you love; know before you judge; commit before you promise; forgive before you forget; appreciate before you regret. May the forthcoming New Year be wonderful in every way and may there be happiness and love each step, each day. With Warm Professional Regards, Forever, yours in service, (CA. V. MURALI)CHAIRMAN, BOARD OF STUDIES, ICAI, NEW DELHI CHAIRMAN’S COMMUNICATION The Chartered Accountant Student January 2016 05 Beloved Students, I n the journey of your pursuit to qualify as a Chartered Accountant, you might encounter challenges. You can overcome those challenges if you can e