How to Prepare For CA-Foundation Accounting? Expert Tips & Tricks and more!
CA Foundation is the new CPT, and you already know that. Under the revised syllabus issued by the ICAI, Accounts is treated as a full-fledged subject which is allotted a full 100 marks. No more MCQs like in CPT, now you will have full-blown accounting problems to solve to earn your passing marks. Between then and now, the whole world seems to have changed for CA students. But, we will tell you what hasn’t.
Accounts was, is, and shall continue to be one of the core subjects in CA exams. That’s hardly a surprise, given that the life of a Chartered Account rotates around accounting. At the Foundation level, the paper of Principles and Practice of Accounting focuses on the fundamentals of accounting. The object of this paper is to help students develop a basic understanding of the principle accounting accepts and apply the same to solve business problems.
CA Foundation Accounts Syllabus:
- Theoretical Framework.
- Accounting Process
- Bank Reconciliation Statement
- Concept and Accounting of Depreciation
- Bill of exchange and Promissory Notes
- Sale of Goods on Approval or Return Basis
- Joint Ventures
- Royalty Accounts
- Average Due Date
- Account Current
- Preparation of Final Accounts of Sole Proprietors
- Partnership Accounts
- Financial Statements of Not-for-Profit Organizations
- Company Accounts.
- Basic Accounting Ratios.
CA Foundation Accounts Question Paper Pattern
Q. 1 is a compulsory question of 20 marks with a mix of questions based on Knowledge and application. It consists of questions in form of True or False, direct knowledge and comprehension based questions and a short direct question based on any of the chapters.
Q. 2 to Q. 6- Attempt any 5. Questions are strictly as per the weightage assigned to each of the unit. These questions are based on Study Module, Revision Test Papers and Mock Test Papers issued by ICAI.
Typology of Questions:
5-20% of the paper is based on Comprehension and Knowledge. Questions set at this level require recognition and recall of concepts, principles and provisions. Such questions may involve recalling a definition, explaining a concept, describing a process, discussing a provision of law, listing the conditions to be satisfied or classifying under the appropriate head.
80-95% of the paper is Analysis and Application based. Questions set at this level require applying and analyzing concepts, provisions, theories, principles learnt, in problem solving. Such questions may involve making computations, calculations, estimations, examining issues, reconciling bank statements, solving problems by integrating provisions, identifying the nature of expenditure or income, determining profit or loss etc. The level of complexity ranges from low to moderate.
CA Foundation Accounts Chapter-wise Weight-age:
Unit 1: Theoretical Framework including accounting concepts, policies, capital & revenue receipts/expenditure, accounting standards and Indian AS – 5 to 10 Marks
Unit 2: Accounting Process, BRS, Inventories and Depreciation including preparation of books of accounts, trial balance, rectification of errors, BRS, inventory valuation and the concept of depreciation – 20 to 25 Marks
Unit 3: Accounting for Special Transactions including bills of exchange, sale of goods on approval basis, consignment, joint venture, royalty accounts, average due date and account current – 15 to 25 Marks
Unit 4: Final Accounts/Financial Statements of Sole Proprietor, Partnership and NPO including financial statements with closing adjustment entries, final accounts of sole proprietor, partnership, admission, retirement & death of partner and NPO – 25 to 30 Marks
Unit 5: Company Accounts including shares, debentures, forfeiture of shares and re-issue of forfeited shares – 10 to 15 Marks
Unit 6: Accounting Ratios including profitability, solvency, liquidity and turnover ratios – 10 to 15 Marks
CA Foundation Accounts Most Important Topics
Most Important Topics include Final Accounts and Financial Statements. This includes chapters like preparation of financial statements of sole proprietor, partnership accounts and financial statements of NPO. Students can expect minimum of 1 question from each of these chapters with a total of 25-30 marks.
Post these, you have unit of Accounting Process, BRS, Inventories and Depreciation that talks about 4 major topics with numerous concepts to be tested for. This unit if prepared well, you can cumulate marks up to 50 and well reach goal of exemption if preparation is accompanied with chapters like theoretical framework.
Some Quick Functional CA Foundation Accounts Tips:
Q 1: For question based on comprehension and knowledge, mention what the law specifies and how it will impact the current scenario. And, for questions based on Application, perform procedures which are strictly mentioned in the Accounting Standard in case if applicable.
Q 2-6: The question paper is a mix of practical and theory questions which are majorly of application type. For theoretical questions or sub-questions, it is always recommended that the student specify Accounting Standards, as and when necessary. Answers to practical problems should include working notes, if required. All these workings carry marks. And wherever necessary, suitable assumption must be made by the student with clear indication of logic in the answer.
CA Foundation Accounts Preparation Tips:
- Get familiar with your syllabus and plan your time table in a way so that you can cover all the topics and have sufficient time for revision.
- Understand the concept & fundamentals clearly; it will help in solving complex problem.
- Practice enough so as to make sure that you are able to complete your paper on time.
- Allocate your schedule in a way so that you can go through your study material at least 3 to 4 times.
First reading: Gain an overview of chapter.
Second reading: Solve sums from ICAI module & mark typical problems which you can practice before exam.
Third reading: Revise what you have studied, practice mock test papers, and solve RTP attempt previous year papers to check yourself.
- Attempt practical problems (solved illustrations) without peeping at the solutions, and then compare answers to evaluate performance. Analyze mistakes and rectify them.
- Work more on those chapters that you find difficult.
- Are you an early riser or a nocturnal owl? Choose your study time when you are most productive. Take small breaks whenever you feel fatigued.
Exam Tips for CA Foundation: Accounts
Commerce students already know this: Accountancy is the most scoring subject in CA Foundation. Even non-commerce students can do well here, if you put in a little more effort than usual. Students should remember that the main objective here is to test basics fundamentals of accounting. Students should concentrate on Royalty Accounts, Final Statements of Not for profit Organization, and Average due date and Account Current as they are newly introduced in CA foundation course. Also,
- Presentation of the paper in the allotted 3 hours is an important skill to master. One should write legibly and neatly and answer the questions in a concise manner.
- Adequate working Notes should be provided.
- Answer the questions with due emphasis on the provision of Accounting Standards.
- State assumptions, if any, in the form of notes clearly.
Follow these tips and tricks, and should you have stumble on anything that you don’t know how to handle, simply give us a shout out! Our experts will be available @ 1800-212-8575. Let’s crack CA Foundation together!