CA Foundation Syllabus 2023 – (New & Old)

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Chartered Accountancy is a prestigious profession with high earning potential, attracting students globally. In India, aspiring CA professionals must clear three levels of exams: CA Foundation, IPCC, and CA Final, conducted by ICAI. These exams are renowned for their difficulty. This blog provides comprehensive information about the CA Foundation syllabus 2023, including the exam pattern, marking scheme, and other crucial details. 

The syllabus of the Chartered Accountants (CA) Foundation examination is as follows:

Paper 1: PRINCIPLES AND PRACTICE OF ACCOUNTING

(Total marks: 100 marks) (Duration of exam: Three hours)

Objective

The major objective is to understand the fundamental concepts and principles of Accounting. It is to help candidates acquire the ability to apply it to prepare financial statements and simple problem-solving.

Contents:

1. Theoretical framework

• Accounting as a Measurement Discipline: Valuation Principles, Accounting Estimates
• Indian Accounting Standards: Concepts and Objectives
• Accounting Standards: Concepts and Objectives
• Accounting Policies
• Capital and Revenue Expenditure, Capital and revenue receipts, Contingent assets and contingent liabilities
• Accounting terminology –  Glossary
• Accounting Concepts, Principles and Conventions
• Meaning and Scope of Accounting

2. Accounting process

• Rectification of Errors
• Preparation of Trial Balance
• Books of Accounts

3. Bank Reconciliation Statement

• Introduction
• Preparation of Bank Reconciliation Statement
• Reasons

4. Inventories

• Basis and Technique of Inventory Valuation and Record-Keeping
• Net Realizable Value
• Cost of Inventory

5. Concept and Accounting of Depreciation

• Change in Depreciation methods
• Concepts & Methods of Computation and Accounting treatment of Depreciation

6. Accounting for Special Transactions

A. Account Current

• Methods of preparing Account Current
• Meaning of Account Current

B. Average Due Date

• Calculation of average due date in various situations
• Meaning of Average due date.

C. Consignments

• Accounting treatments for consignment transactions and events in the books of consignor and consignee
• Difference between sale and consignment
• Meaning and features of consignment business

D. Sale of goods on approval or return basis

• Meaning of goods sent on approval or return basis and their accounting treatment.

E. Bills of exchange and promissory notes

• Meaning of Bills of Exchange and Promissory Notes and their Accounting Treatment
• Accommodation bills

7. Final Accounts of Sole Proprietors

• Trading Account
• Elements of financial statements
• Profit and Loss Account and Balance Sheet of Manufacturing and Non-manufacturing entities
• Closing Adjustment Entries

8. Partnership Accounts

• Introduction to LLPs and Distinction of LLPs from Partnership
• Admission, Retirement, and Death of a Partner including Treatment of Goodwill
• Final Accounts of Partnership Firms

9. Financial Statements of Not-for-profit Organizations

• Significance of Receipt and Payment Account, Income and  Expenditure Account, and Balance Sheet
• Preparation of Receipt and Payment Account, Income and Expenditure Account, and Balance Sheet
• Difference between Profit and Loss Account and Income and Expenditure Account

10. Introduction to Company Accounts

• Statement of Profit and Loss and Balance Sheet as per Schedule III to the Companies Act, 2013
• Issue of Shares and Debentures
• Forfeiture of shares
• Re-issue of forfeited shares
• Definition of shares and debentures

Also explore:

• CA Foundation Maths Question Paper
• CA Foundation Law Question Paper
• CA Foundation Accounts Question Paper
• CA Foundation Economics Question Paper
• CA Foundation Preparation Strategy 2023

Paper 2:  BUSINESS LAWS AND BUSINESS CORRESPONDENCE AND REPORTING

(Total Marks: 100 marks)  (Duration of exam: Three hours]

Section A: BUSINESS LAWS [60 marks]

Objective:

To help candidates develop a thorough understanding of significant provisions of select business laws and acquire the ability to address basic application-oriented issues.

Contents

1. The Companies Act, 2013

• Incorporation of company
• Types of share capital
• Classes of companies
• Corporate veil theory
• Essential features of the company
• Doctrine of Indoor Management
• Memorandum of Association
• Articles of Association

2. The Limited Liability Partnership Act, 2008

• Introduction – covering nature and scope
• Incorporation and differences with other forms of organizations
• Characteristics of LLP
• Essential features

3. The Indian Partnership Act, 1932

• Registration and dissolution of a firm
• Reconstitution of firms
• Rights and duties of partners
• General Nature of Partnership

4. The Sale of Goods Act, 1930

• Unpaid seller and his rights
• Transfer of ownership and delivery of goods
• Conditions and Warranties
• Formation of the contract of sale

5. The Indian Contract Act, 1872

• An overview of sections 1 to 75 covering the general nature of a contract
• Other essential elements of a valid contract
• Performance of a contract
• Consideration
• Contingent and Quasi Contract
• Breach of contract

Section B:  BUSINESS CORRESPONDENCE AND REPORTING    [40 marks]

Objective

To help candidates acquire good communication skills required for Business Correspondence and Reporting

Part I: Communication

• Communication
• Types of Communication

i) Emotional Intelligence.

ii) Interpersonal Skills.

iii) Listening Skills.

• Barriers
• Problems
• Process
• Network
• Directions
• Types
• Exercises
• Sample Questions with Answers

Part II: Sentence Types and Word Power

2. Sentence Types [Active-Passive Speech, Direct-Indirect]

• Sentence Structure

i) Object [Direct, Indirect].

ii) Verb [Auxiliary, Finite].

iii) Subject and Predicate.

iv) Types of clauses.

• Dependent clauses
• Relative or noun clauses
• Independent clauses

v) Clause structure.

vi) Adjunct or Adverbial.

vii) Complement.

• Classification of sentence based on connotation

i) Optative sentences.

ii) Exclamatory sentences.

iii) Imperative sentences.

iv) Interrogative sentences.

v) Assertive sentences.

• Sentence: definition
• Direct – Indirect Speech

i) Introduction.

ii) The procedure for converting Direct speech into Indirect speech.

• Punctuation in Direct speech
• Changes for Interrogative sentences
• Changes for Exclamatory sentences
• Changes for Imperative Sentences
• Change in Modals
• Change in tenses
• Change in pronouns
• Rules for converting Direct speech into Indirect speech
• Rules for converting Indirect Speech into Direct speech

• Active Passive Voice: Introduction

i) Changing Passive voice to Active voice.

ii) Changing Active voice to Passive voice.

iii) Suggestions for using Active and Passive voice.

iv) Reasons for using Passive voice.

v) Usage: Active vs passive voice.

• Verbs Voice Active or Passive
• Types of sentences

i) Compound-complex sentence.

ii) Complex sentence.

iii) Compound sentence.

iv) Simple sentence.

• Exercises

3. Vocabulary Root Words, Synonyms, Antonyms, Prefixes, Suffixes, Phrasal verbs, Collocations, and Idioms

• Introduction
• Idioms
• Collocations
• Phrasal verbs
• Words formed by using Suffixes
• Words formed by using Prefixes
• Synonyms and Antonyms
• Root words
• How to improve vocabulary
• Significance of improving vocabulary
• Exercises

Part III Comprehension Passages and Note Making

4. Comprehension Passages

• Introduction to Comprehension Passages
• Sample Passages with answers
• Points to Ponder
• Exercises

5. Note Making

• Introduction to Note Making
• Detailed Format Heading [title]

• Subheading
• Expression
• Content
• Summary
• Use of abbreviations
• Points
• Indentation

• Significance of Note Making
• Helpful Hints

• Sample passages with notes
• Steps to Comprehend and summarize the text
• Exercises

Part IV: Developing Writing Skills

6. Introduction to Basic Writing

• Introduction
• Do’s and don’ts of good writing
• Characteristics of good writing
• Writing Conventions
• Significance of writing skills for students
• Styles of Writing
• Process of writing

7. Precis Writing

• What is Précis writing?
• Features of good Précis writing
• Examples [Passages with Precis]
• Do’s and don’ts of Precis writing
• How to write a Precis
• Exercises

8. Article Writing

• What is an Article?
• Essential elements of Article Writing
•  Sample Articles
• Detailed format

• Title
• By- writer’s name
• Body – Introduction, Main idea support, Conclusion
• Exercises

9. Report Writing

• What is a Report?
• Essential elements of Report Writing
• Kinds of Reports

• Reporting for a meeting/assembly
• Reporting for a newspaper
• Reporting for a magazine

• Detailed Format for Above

• Title
• By-  writers name
• Place, date
• Body – What, How, Who, Where, When
• Tips and Conventions of Report Writing
• Sample Reports
• Exercises

10. Writing Formal Letters

• Types of Letters

i) Recovery/remittances.

ii) Sales.

iii) Promotional content.

iv) Memos.

v) Complaints.

vi) Circulars.

• Detailed format for above

i) Date.

ii) Salutation.

iii) Subject.

iv) Body of the Letter – First paragraph, second paragraph.

v) Complimentary closure.

• Sample letters
• Points to remember
• Exercises

11. Writing Formal Mails

• How to Write a Formal Mail?
• Writing Effective Mails
• Tips and Conventions of Mails
• Essential elements of Mails :

i) Subject line.

ii) Formal Greetings.

iii) Target Audience(Reader).

iv) Clarity and Conciseness.

v) Formal Closing.

vi) Proofread.

vii) Feedbac.

• Sample Mails
• Exercises

12. Resume Writing

• Essential elements of Resume
•  Name and contact details
• Objective Summary
•  Academic Qualifications and Achievement
•  Co-curricular Achievement
•  Training Programs attended/completed
• Strengths
• Interests/Hobbies
• Declaration
•  Signature

• Resume Writing Tips and Conventions
• Sample Resume
• Exercises

13. Meetings

• Notice
• Agenda
• Drafting minutes
• Action Taken Report

Paper 3: BUSINESS MATHEMATICS, LOGICAL REASONING AND STATISTICS
(CA Foundation Maths Syllabus)

(Total Marks: 100 marks)  (Duration: Two Hours) 

Objective:

• To help candidates develop an understanding of the basic mathematical and statistical tools and their application in the areas of Business, Finance, and Economics.
• To enable candidates to develop logical reasoning skills and apply the same in problem-solving.

Part A – Business Mathematics [40 marks]

Contents:

1. Ratio and Proportion, Indices and Logarithms

• Exponents and Logarithms and Anti logarithms
• Ratio and Proportion [Business Applications related to Ratio and Proportion] Laws of Indices

2. Equations

• Quadratic and Cubic equations in one variable
• Simultaneous linear equations up to three variables

3. Linear Inequalities with Objective Functions and Optimization w.r.t objective function

4. Time value of Money

• Simple Interest
• Compound Interest
• Valuation of Bonds
• Sinking Funds
• Annuities
• Perpetuity
• Net Present Value
• Present Value
• Future Value
• Effective Rate of Interest
• Depreciation
• Calculating of EMI
• Calculations of Returns:

i) Compound Annual Growth Rate [CAGR].

ii) Effective Rate of Return.

iii) Nominal Rate of Return.

5. Permutations and Combinations

• Basic concepts of Permutations and Combinations: Introduction

– Permutations

– Results

– Combinations with standard results

– Permutations with restrictions

– Circular Permutations

– The Factorial

6. Sequence and Series

• Introduction Sequences
• Series
• Relationship between AM and GM and Sum of n terms of special series
• Arithmetic and Geometric progression

7. Sets, Relations and Functions

8. Basic applications of Differential and Integral calculus [Excluding the trigonometric applications]

• Applications of Marginal Cost and Marginal Revenue, etc.

Part B – Logical Reasoning [20 marks]

• Number series, coding, and decoding, and the odd man out
• Blood relations
• Seating arrangements
• Direction tests

Part C – Statistics [40 marks]

1. Statistical description of Data

• Pie chart
• Ogive
• Frequency polygon
• Graphical representation of Frequency Distribution – Histogram
• Frequency Distribution
• Diagrammatic representation of data
• Statistical representation of Data

2. Measures of Central Tendency and Dispersion

• Measures of Central Tendency and Dispersion: Mean Median, Mode
• Coefficient of Quartile Deviation
• Coefficient of Variation
• Standard Deviation
• Quartiles and Quartile Deviation
• Mean Deviation

3. Probability

• Probability: Independent and dependent events
• Total and Compound Probability and Mathematical Expectation
• Mutually Exclusive Events

4. Theoretical Distributions

• Theoretical Distributions: Binomial Distribution
•  Poisson distribution – basic application
• Normal distribution – basic applications

5. Correlation and Regression

• Correlation and Regression: Scatter diagram
• Regression coefficients
• Regression equations
• Regression lines
• Probable Errors and Probable limits
• Karl Pearson’s Coefficient of Correlation Rank Correlation

6. Index Numbers

• Uses of Index Numbers
• Methods of construction of Index Numbers
• Problems involved in the construction of Index Numbers

Paper 4: BUSINESS ECONOMICS AND BUSINESS AND COMMERCIAL KNOWLEDGE

(Total Marks: 100 Marks)  (Duration: Two Hours)

Part I – Business Economics [60 marks]

Objective

To help candidates develop an understanding of the theories and concepts in Business Economics and apply these in simple problem-solving.

1. Introduction to Business Economics

• Meaning and scope of Business Economics
• Basic Problems of an Economy and Role of Price Mechanism

2. Theory of Demand and Supply

• Meaning and determinants of demand, the Law of Demand, and Elasticity of demand – price, income and cross elasticity
• Meaning and determinants of supply, Law of supply, and Elasticity of supply.
• Theory of consumer’s behaviour – Marshallian approach and indifference curve approach
• Demand Forecasting

3. Theory of Production and Cost

• Meaning and Factors of production
• Concepts of Costs ─ Short-run and long-run costs, Average and marginal costs, Total, fixed, and variable costs
• Laws of Production – The Law of Variable proportions and Laws of Returns to Scale, Producer’s equilibrium

4. Price Determination in Different Markets

• Various forms of markets – Perfect Competition, Monopoly, Monopolistic Competition, and Oligopoly
• Price determination in these markets

5. Business Cycles

• Meaning
• Features
• Causes behind these cycles
• Phases

Part II: Business and Commercial Knowledge [40 marks]

To help candidates develop an understanding of common business and commercial concepts and to help them stay abreast of developments in the world of business and commerce.

Contents:

1. Business and Commercial Knowledge – An Introduction

• Nature of Business, Profession, and Employment
• Forms of Business Organizations
• Economic and Non-Economic Activities
• Objectives of business

2. Business Environment

• Micro and Macro Environment
• Elements of Macro Environment – Demographic, Political-legal, Economic, Socio-cultural, Technological, Global Environment.

• Elements of Micro Environment – Consumers/Customers, Organization, Competitors, Market, suppliers, Intermediaries

3. Business Organizations

• Overview of selected Indian and Global Companies

4. Government Policies for Business Growth

• Policies creating a conducive business environment such as liberalization, Foreign Direct Investment, and Privatization

5. Organizations Facilitating Business

• Indian Development Banks – NABARD
• Indian Regulatory Bodies – RBI, SEBI, CCI, IRDAI

6. Common Business Terminologies

• Banking Terminology
• Marketing Terminology
• Finance and Stock and Commodity Markets Terminology
• Other business terminology

Note:

• Candidates must read at least one financial newspaper and one business magazine on a regular basis. They may also watch a business news channel in order to stay abreast of developments related to the commercial world.