ICAI - COMMON PROFICIENCY TEST
Section A: Fundamentals of Accounting (60 Marks)
Process - Books of Accounts leading to the preparation of
Trial Balance, Capital and revenue expenditures, Capital and revenue receipts, Contingent assets
and contingent liabilities, Fundamental errors
Objective: To develop
conceptual understanding of the fundamentals of financial accounting system. Contents
(i) Meaning and Scope of accounting
(ii) Accounting Concepts, Principles
(iii) Accounting Standards –
concepts, objectives, benefits
(iv) Accounting Policies
(v) Accounting as a measurement
discipline – valuation principles, accounting estimates
including rectifications thereof.
4. Inventories- Basis of
inventory valuation and record keeping.
accounting - Methods, computation and accounting treatment of
depreciation, Change in depreciation methods.
6. Preparation of
Final Accounts for Sole Proprietors
7. Accounting for
(b) Joint Ventures
(c) Bills of exchange and promissory
(d) Sale of goods
on approval or return basis.
Accounts - Final accounts of partnership firms – Basic concepts of
admission, retirement and death of a partner including treatment of goodwill.
9. Introduction to
Company Accounts- Issue of shares and debentures,
forfeiture of shares, re-issue of forfeited shares, redemption of preference
Section B: Mercantile Law (40 Marks)
Objective: To test
the general comprehension of elements of mercantile law. Contents
1. The Indian Contract Act ,
An overview of Sections 1 to 75 covering the general nature of contract , consideration , other essential
elements of a valid contract , performance of contract and breach of contract.
2. The Sale of
Goods Act, 1930: Formation of the contract of sale – Conditions and
Warranties – Transfer of ownership and delivery of goods – Unpaid
seller and his rights.
3. The India
Partnership Act, 1932: General Nature of Partnership – Rights and
duties of partners – Registration and dissolution of a firm.
Section C: General Economics (50 Marks)
Objective: To ensure basic
understanding of economic systems, economic behaviour of individuals and organizations. Contents
(I) Micro Economics
1. Introduction to Micro Economics
scope and nature of Economics
(b) Methods of
problems of an economy and Production possibilities curve.
of Demand and Supply
Meaning and determinants of demand, Law of demand and Elasticity of demand ─ Price,
income and cross elasticity
(b) Theory of consumer
’s behaviour – Marshalling approach and Indifference curve approach
(c) Meaning and
determinants of supply, Law of supply and Elasticity of supply.
3. Theory of Production and Cost
(a) Meaning and
Factors of production
(b) Laws of Production
– The Law of variable proportions and Laws of returns to scale
(c) Concepts of Costs
─ Short-run and long-run costs, Average and marginal costs, Total, fixed and
4. Price Determination in Different Markets
forms of markets – Perfect Competition, Monopoly, Monopolistic Competition and
determination in these markets.
(II) Indian Economic Development
5. Indian Economy – A Profile
(a) Nature of
the Indian Economy
(b) Role of
different sectors – Agriculture, Industry and Services in the development of
the Indian economy, their problems and growth
Income of India – Concepts of national income, Different methods of measuring
national income, Growth of national income and per capita income in various
understanding of tax system of India – Direct and Indirect Taxation
6. Select Aspects of Indian Economy
Population – Its size, rate of growth and its implication for growth
(b) Poverty –
Absolute and relative poverty and main programs for poverty alleviation
Unemployment – Types, causes and incidence of unemployment
─ Energy, Transportation, Communication, Health and Education
(f) Budget and
(g) Balance of
7. Economic Reforms in India
of economic reforms since 1991
Liberalisation, Privatisation and Disinvestment
8. Money and Banking
Money – Meaning and functions
Banks – Role and functions
(c) Reserve Bank
of India – Role and functions, Monetary policy.
Section D: Quantitative Aptitude (50 Marks)
To test the grasp of elementary concepts in Mathematics and Statistics and
application of the same as useful quantitative tools. Contents
1. Ratio and proportion, Indices,
- Linear – simultaneous linear equations up to three variables, quadratic and
cubic equations in one variable, equations of a
straight line, intersection of straight lines, graphical solution to linear
3. Inequalities -
Graphs of inequalities in two variables ─ common region.
4. Simple and
Compound Interest including annuity ─ Applications
concepts of Permutations and Combinations
6. Sequence and
Series – Arithmetic and geometric progressions
7. Sets, Functions
8. Limits and
Continuity ─ Intuitive Approach
9. Basic concepts
of Differential and Integral Calculus (excluding trigonometric functions)
10. Statistical description of data
Tabular & Diagrammatic representation of data.
representation of frequency distribution – Histogram, Frequency Polygon, Give
11. Measures of
Central Tendency and Dispersion- Arithmetic Mean, Median – Partition
Values, Mode, Geometric Mean and Harmonic, Mean, Standard deviation,
12. Correlation and
and Expected Value by Mathematical Expectation
Distributions - Biomial, Poisson and Normal.
15. Sampling Theory
- Basic Principles of sampling theory, Comparison between sample survey and
enumeration, Errors in sample survey, Some
important terms associated with sampling, Types of sampling, Theory of estimation,
Determination of sample size.
16. Index Numbers
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