CA Inter Syllabus and Subjects

ICAI has made some changes in the CA inter syllabus since the CA Intermediate November 2019 exams. Some topics from the previous syllabus have been removed and some have been added to the new CA inter syllabus. Check the next two sections for details. 

• The CA intermediate syllabus 2021 is split into two groups. The registered candidates can appear in either one or both groups based on their preference and preparation. 
• The new CA inter syllabus also follows a revised structure of marks distribution. Aspirants are advised to plan their preparations keeping these weights in mind.

The ICAI has made some exclusions in their amended CA inter syllabus, which include: 

Paper 2 Corporate and Other Laws

Some sections of Companies, Act 2013: Prospect and allotment of Securities - Sections 24, 30, 33, 38, & 41; Share Capital and Debentures - 44, 45, 60, 65 & 72; Acceptance of deposits by companies - 75, Registration of charges - 81 & 85.

Paper 3 Cost Accounting 

Certain portions from material, employee cost and incentive schemes, direct expenses and costing of service sectors are no longer in the syllabus.  

Paper 6 Auditing and Assurance 

Some engagement and quality control standards on Auditing as well as some guidance notes have been excluded. 

Paper 8 Sec A Financial Management 

Some parts of capital budgeting have been removed. 

All subjects of CA intermediate have been categorized into two groups, namely Group 1 and Group 2. 

Here’s a list of CA inter group 1 subjects. Note that each of these papers carries 100 marks in total are the examination duration for each of the papers is 3 hours:

• Paper 1: Accounting 
• Paper 2: Corporate Law and Other Laws (Includes Company Law & Other Laws)
• Paper 3: Cost Accounting and Management Accounting 
• Paper 4: Taxation, where Section A is Income Tax Law and Section B is Indirect Taxes 

The next section depicts CA inter group 2 subjects:

• Paper 5: Advanced Accounting
• Paper 6: Auditing and Assurance 
• Paper 7: Enterprise Information Systems and Strategic Management 
• Paper 8: Financial Management and Economics for Finance

Let’s give you a detailed breakdown of the topics in each paper.  

A large number of businesses today are incorporated as corporate entities. Laws governing these entities are integral to their operations and actions they undertake such as procuring funds, raising capital, purchase of essential goods, etc.  

In the CA foundation course, students are acquainted with business laws that regulate the activities of business establishments and are taught the basics of communicating and reporting their observations in a professional setting with clarity and accuracy. CA Inter builds on that knowledge and further prepares the students to work in the corporate field. It provides them with sound knowledge and skills in evaluating and applying corporate law and other laws to practical situations with full confidence. This paper is divided into two parts — Corporate Law (part 1) and Other Laws (part 2). 

Part I: Company Law

The paper aims to help the students gain a deeper knowledge of the provisions of the company law and develop the required skills to apply the same in real-world scenarios.

What does the paper cover?

The Companies Act, 2013 – Sections 1 to 148 

1. Preliminary
2. Incorporation of Company and Matters Incidental thereto
3. Prospectus and Allotment of Securities
4. Share Capital and Debentures
5. Acceptance of Deposits by companies
6. Registration of Charges
7. Management and Administration
8. Declaration and Payment of Dividend
9. Accounts of Companies
10.  Audit and Auditors

Note: All existing provisions of the Companies Act, 1956 are part of the syllabus until any provision is replaced by corresponding or new provisions of the Companies Act, 2013. In such cases, inclusions/exclusions will be made accordingly. 

Part II: Other/Allied Laws

The aim of the paper is to help the students understand the provisions of selected legislation and gain the skills to apply the same to real-world cases. The paper also focuses on building a sound understanding of the rules by which the relevant statutes can be interpreted. 

What the paper covers:

• The Indian Contract Act, 1872
• The Negotiable Instruments Act, 1881
• The General Clauses Act, 1897
• Interpretation of statutes

Note: When/if any legislations are replaced by new legislations or simply cease to exist, the CA intermediate syllabus will reflect the changes in the form of specific inclusions/exclusions.

Because taxes form such a vital part of the overall economics of business management, it puts CA professionals in the position to carry out a wide range of tax-related tasks for a business entity. From preparing the returns, representing a tax assessee before authorities to playing an advisory role, and auditing complex cases, the financial expertise of CAs is appreciated to the fullest in many areas. 

Paper 4 Taxation of the CA inter syllabus is designed to build the students’ proficiency in both Direct taxes and Indirect taxes. 

The aim of this paper is to help students get an in-depth understanding of the provisions of income tax law and laws pertaining to goods and services tax. The paper also focuses on giving students the requisite practical skills for real-life applications. 

In addition, the students are expected to stay updated with the latest provisions and the highly evolving tax structure of the country to apply the knowledge gained in this paper to practical scenarios with confidence.

What the paper covers:

Section A – Income Tax Laws

• Basic concepts
• Residential status and scope of total income
• Incomes that do not form part of total income (other than charitable trusts and institutions, political parties, and electoral trusts) 
• Heads of income and the provisions governing the computation of income under different heads 
• Income of other persons included in assesses total income
• Aggregation of income: set-off, or carry forward and set-off of losses
• Deductions from gross total income 
• Computation of total income and tax liability of individuals 
• Advance tax, tax deduction at source, and introduction to tax collection at source 
• Provisions for filing return of income and self-assessment

Section B – Indirect Taxes 

• Concept of indirect taxes
• Goods and service tax (GST) laws

Note: Any amendments made in the provisions of the Income-tax Law and Goods and Services Tax (GST) laws covered in this paper will reflect in the form of inclusions/exclusions in its syllabus. The changes in the syllabus may also arise due to the changes made in the annual Finance Act.

In the professional world, auditing is possibly one of the key areas where the skills and expertise of a Chartered Accountant really shine through. CAs are valued for their specialized training, proficiency, and sound judgment in ensuring that the financial statements are prepared and presented by entities in compliance with the recognized accounting principles, standards, and legal provisions and in a true and fair manner.

Paper 6 of the CA inter syllabus acquaints students with the basic auditing concepts and prepares them for CA Final Paper 3 (Advanced Auditing and Professional Ethics) where the subject is handled in-depth.  

The paper aims to help students acquire a conceptual understanding of auditing as well as the necessary skills pertaining to auditing procedures and techniques to be applied to real-world audit and attestation practices.

What the paper covers:

• Nature, Objective, and Scope of Audit
• Audit Strategy, Audit Planning, and Audit Programme 
• Audit Documentation and Audit Evidence 
• Risk Assessment and Internal Control
• Fraud and Responsibilities of the Auditor in this Regard
• Audit in an Automated Environment
• Audit Sampling
• Analytical Procedure
• Audit of Items of Financial Statements
• The Company Audit
• Audit Report
• Audit of Banks
• Audit of Different Types of Entities

Note: Any amendments in the Companies Act, 1956, changes in Standards on Auditing/Guidance Notes/Statements, or any relevant new legislation will reflect on the syllabus of this paper in the form of inclusions/exclusions.

Finance is the fuel that powers a business, while financial economics is a special branch of economics that deals with commercial activities and transactions and how they are affected by the local and global markets. 

CA professionals, especially those who see themselves in consultancy, tax, and auditing-related roles, need to have a solid understanding of financial management strategies, various key financial decisions made in a business entity, and how finance relates to the overall functioning of the organization, among other concepts. 

Paper 8 Financial Management and Economics for Finance in CA inter syllabus not only equips students with the relevant topics but also prepares them for CA Final Paper 2 Strategic Financial Management. 

CA Inter Paper 8 has two sections. Section A is dedicated to various aspects of Financial Management, along with its practical application. 

Section B is aimed at helping students understand Economics conceptually and theoretically, in the context of Finance, while also equipping them with necessary skills for applying the knowledge to real-world scenarios.

Section A: Financial Management

• Financial Management and Financial Analysis
  • Introduction to Financial Management Function

• • Objective and scope of financial management
  • Role and purpose
  • Financial management environment
  • Functions of finance executives in an organization
  • Financial distress and insolvency

• Financial Analysis through Ratios
  • Users of the financial analysis
  • Sources of financial data for analysis
  • Calculation and Interpretation of ratios: analysing liquidity, analysing leverage, analysing solvency, analysing efficiency/ activity, analysing profitability
  • Limitations of ratio analysis
• Financing Decisions
  • Sources of Finance

• • • Different Sources of Finance, Characteristics of different types of long-term debt and equity finance, Method of raising long term finance
    • Different Sources of short-term Finance
    • Internal fund as a source of finance
    • International sources of finance
    • Other sources of finance- Sale and leaseback, Convertible debt, Venture capital, Grants etc.

• • Cost of Capital

• • • Significance of cost of capital
    • Factors of cost of capital
    • Measurement of costs of individual components of capital
    • The weighted average cost of capital (WACC)
    • The marginal cost of capital
    • Effective Interest rate

• • Capital Structure Decisions

• • • Significance of capital structure
    • Determinants of capital structure
    • Capital structure planning and designing
    • Designing of optimum capital structure
    • Theories of Capital Structure and value of the firm- relevancy and Irrelevancy of capital structure
    • EBIT- EPS Analysis, Breakeven- EBIT Analysis
    • Under/ Over Capitalisation

• • Leverages

• • • Types of Leverages- Operating, Financial and Combined
    • Analysis of leverages
• Capital Investment and Dividend Decisions
  • Capital Investment Decisions

• • •  The objective of capital investment decisions
    • Methods of Investment appraisal: Payback period, Discounted payback period, Accounting Rate of Return (ARR), Net Present Value (NPV) – The meaning of NPV, Strengths and limitations of NPV method, The working capital adjustment in an NPV analysis, Capital rationing, Equivalent Annual Costs, Internal Rate of return (IRR)- Limitations of the IRR method, Multiple IRRs, Modified Internal Rate of Return (MIRR)- Definition and explanation of MIRR, The process for calculating MIRR, Strengths of the MIRR approach, Profitability Index

• • Adjustment of Risk and Uncertainty in Capital Budgeting Decision

• • • Probability Analysis
    • Certainty Equivalent Method
    • Risk-Adjusted Discount Rate
    • Scenario Analysis
    • Sensitivity Analysis

• • Dividend Decisions
    • Basics of Dividends
    • Forms of dividend
    • Determinants of dividend
    • Relevancy and Irrelevancy of Dividend Policies- Traditional Approach, Walter’s model, Gordon’s model, Modigliani and Miller (MM) Hypothesis
• Management of Working Capital
  • The management of working capital- Liquidity and Profitability
  • The Working capital financing decisions- Primary and Secondary Sources of Liquidity
  • The working Capital Cycle (operating Cycle), Effectiveness of Working Capital based on its operating and cash conversion cycles
  • Assessment of working capital requirement
  • Management of Accounts Receivables (Debtors)
  • Factoring and Forfaiting
  • Management of Accounts Payables (Creditors)
  • Management of Inventory
  • Management of Cash, Treasury management
  • Banking norms of working capital finance

Section B: Economics for Finance

• Determination of National Income
  • Macro-Economic Aggregates and Measurement of National Income
  • The Keynesian Theory of Determination of National Income
• Public Finance
  • Fiscal functions: An Overview.
  • Market Failure
  • Government Interventions to Correct Market Failure
  • Fiscal Policy
• The Money Market
  • The Concept of Money Demand: Important Theories of Demand for Money
  • The Concept of Money Supply
  • Monetary Policy
• International Trade
  • Theories of International Trade
  • Trade Policy – The Instruments of Trade Policy
  • Trade Negotiations
  • Exchange Rates and their economic effects
  • International Capital Movements: Foreign Direct Investment

To download the complete syllabus and list of all CA intermediate subjects, click here.