SYLLABUS Spring 2015

Syllabus Spring - 2015
Against each content of the syllabus, the given number shows the level of understanding
expected by the Institute.
The levels are explained as under:
Level 1
The competency of this level requires understanding and awareness of the subject matter and
related concepts. The candidates will be expected to have ability to understand the nature of
basic concepts.
Level 2
The competency of this level requires good understanding and detailed evaluation of the
subject matter and related concepts, along with the ability to apply concepts and skills in
simple professional scenario. The candidates will be expected to have ability to provide
reasonable support in professional judgment and decision making.
Level 3
The competency of this level requires in-depth understanding of the subject matter and related
concepts. The candidate will be expected to have ability to critically examine and evaluate all
concepts and available information to make firm professional judgments and make decisions.
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Contents
Page
(AFC-1) Functional English
(AFC-2) Business Communication
(AFC-3) Quantitative Methods
(AFC-4) Introduction to Information Technology
16
(CAF-1) Introduction to Accounting
21
(CAF-2) Introduction to Economics and Finance
28
(CAF-3) Business Law
34
(CAF-4) Business Management and Behavioural Studies
42
(CAF-5) Financial Accounting and Reporting I
49
(CAF-6) Principles of Taxation
54
(CAF-7) Financial Accounting and Reporting II
61
(CAF-8) Cost And Management Accounting
67
(CAF-9) Audit and Assurance
73
Assessment of Fundamental Competencies

Functional English
S
Syllabus objectives
and learning outcomes
ASSESSMENT OF FUNDAMENTAL COMPETENCIES
FUNCTIONAL ENGLISH
Objective
To ensure that candidates can communicate effectively in the English language.
Learning Outcome
On the successful completion of this paper candidates will be able to:
1
use vocabulary correctly
construct sentences using correct grammar
write meaningful essays and prcis and comprehend written English
Grid
Weighting
English
Vocabulary
20
Practical use of Grammar
30
Composition and Comprehension (General)
50
Total
Emile Woolf International
100
1
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The Institute of Chartered Accountants of Pakistan
Functional English
Syllabus
Ref
Contents
English
a
Vocabulary
Meanings and application of

vocabulary listed on "The
Oxford 3000- Seventh
Edition".
Practical use of Grammar
Rules of sentences
Level
Learning Outcome
LO1.1.1: Use synonyms or antonyms

for the given words in a sentence.
LO1.1.2: Construct meaningful
sentences using the prescribed word
list.
LO2.1.1: Understand and construct

declarative, interrogative, imperative,
exclamatory and optative sentences
LO2.1.2: Understand and construct
compound, complex, multiple and
conditional sentences
Phrases and idioms
LO2.2.1: Construct meaningful

sentences using commonly used
phrases and idioms
Tenses
LO2.3.1: Understand and apply rules of

tenses in sentences
Direct and indirect speech
LO2.4.1: Change sentences from direct

to indirect and from indirect to direct
speech
Active and passive voice
LO2.5.1: Change of sentences from

active to passive voice and from
passive to active voice
Composition and
Comprehension (General)
Essay Writing
LO3.1.1: Write essays on topics

generally known to a school leaver
Prcis Writing
LO3.2.1: Write meaningful and effective

prcis
Comprehension and speed

reading
LO3.3.1: Comprehend a brief write up

and answer questions based on that
write up
LO3.3.2: Assimilate the contents of a
lengthy write up and answer questions
based on that write up
2
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Business Communication
S
Syllabus objective
BUSINESS COMMUNICATION
Objective
To ensure that candidates can communicate effectively while performing their professional
responsibilities.
Learning Outcome
1
Comprehend concepts of business communication
Demonstrate awareness of listening skills concepts
Write simple business letters and short reports
Understand the utility of the internet with respect to business communication
Grid
Weighting
Concepts
20
Listening skills
20
Business messages and report writing
40
Communication via the internet
20
Total
100
3
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Syllabus
Ref
Contents
a
Concepts
Introduction to business
communication
Level
Learning Outcome
LO1.1.1: Define business

communication
LO1.1.2: Describe with simple
examples the goals, patterns (formal
and informal) and channels of business
communication
Communication process
LO1.2.1: Define communication

process
LO1.2.2: Explain and illustrate the
components of the communication
process, namely: context, sender,
message, medium, recipient, feedback
Seven Cs of effective
communication

examples the seven Cs of effective
communication
LO1.3.2: Identify weakness in a given
simple communication applying the
Seven Cs concept and suggest
corrections
Listening skills
Meaning, types and barriers

to listening
LO2.1.1: Explain why listening is

important in good business
communication.
LO2.1.2: Describe types and barriers to
listening
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Syllabus and study guide
Business messages
Business letters and

circulars
LO3.1.1: Classify the type of business

letters and circulars
LO3.1.2: Draft simple business letters
and circulars
Persuasive letters and

circulars
LO3.2.1: Explain the salient features of

the persuasive letters and circulars
LO3.2.2: Draft simple persuasive letters
and circulars
Short business reports
LO3.3.1: State the meaning and

purpose of a short business report
LO3.3.2: Describe with examples the
common sections of a short business
report
LO3.3.3: Draft a simple business report
Communication via the

internet
Website hosting (types and

services)
LO4.1.1: State meaning, types and

services of web hosting
Features, benefits and

limitations of email
LO4.2.1: State the main features of

email.
LO4.2.2: Enlist the benefits and
limitations of email
Features, benefits and

limitations of video
conferencing
LO4.3.1: State the main features of

video conferencing
LO4.3.2: Enlist the benefits and
limitations of video conferencing
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Quantitative Methods
S
Syllabus objectives
QUANTITATIVE METHODS
Objective
To develop the ability to apply quantitative methods and statistics to business problems.
Learning Outcome
On completion of this paper the candidate will be able to:
1
Understand basic mathematics to build a base for financial analysis and transform
business problems into mathematical equations;
Apply financial mathematics to solve business problems;
Analyse business solutions and identify feasible, alternative optimum and

unbounded solutions using graphical methods;
Evaluate maximised profit, minimised cost and feasible manufacturing quantity by

using calculus;
Analyse production planning cases and formulate solutions using matrices;
Present collected data using diagrams, charts and graphs and evaluate common
measures of dispersion and central tendencies;
Evaluate the impact of inflation and rebase numbers using indices:
Use statistical methods in analyzing historical data for decision making and
estimating future outcomes.
Explain and apply probability theory
10
Explain sampling and explain and carry out tests of significance
6
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Grid
Weighting
Mathematics
Basic mathematics
10
Financial mathematics
20
Calculus
10
Matrices and determinants
10
Statistics
Statistical methods
20
Methods of least square and regression
10
Probability and probability distribution
10
Sampling and decision making
10
Total
100
7
Syllabus objectives and learning outcomes
Contents
Level
Learning Outcome
Mathematics
Basic mathematics
Exponential and logarithmic
functions
LO1.1.1: Demonstrate adequate knowledge

of laws of logarithm.
LO1.1.2: Make use of logarithms in solving

business problems.
LO1.1.3: Perform calculations involving
exponential and logarithmic functions.
LO1.1.4: Analyse the behaviour of business
problems involving exponential and
logarithmic functions.
Equation of straight line
LO1.2.1: Demonstrate adequate

understanding of various forms of the
equation of a straight line.
Application of straight line in

business and economics
LO1.3.1: Identify business situations where

the equation of a straight line could be used.
LO1.3.2: Use the equation of a straight line
in relevant business problems.
Simultaneous equation- linear and

quadratic
LO1.4.1: Demonstrate adequate command

of solving simple equations, including two
variable simultaneous equations and
quadratic equations.
Coordinate system
LO1.5.1: Demonstrate understanding of the

coordinate system and be able to prepare
graphs of linear equations.
System of linear inequalities and

their graphical presentation
LO1.6.1: Demonstrate an understanding of

linear inequalities.
LO1.6.2: Demonstrate the graphical
presentation of linear inequalities.
Factorisation of equations including

factorisation by completion of
squares
LO1.7.1: Perform multiplication and division

operations on linear and quadratic
equations.
LO1.7.2: Solve quadratic equations by

factoring and by completing the square
method.
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Contents
Level
Learning Outcome
Mathematics
Basic mathematics (continued)
Arithmetic progression
LO1.8.1: Identify situations where data is in

arithmetic progression.
LO1.8.2: Use arithmetic progression in

business problems to calculate monthly
instalments, first instalment, total amount
paid and total time required for settlement of
a loan etc.
2
LO1.9.1: Use geometric progression in

relevant situations.
Simple interest
LO2.1.1: Calculate interest value using

simple interest.
Compound interest
LO2.2.1: Calculate interest value using

compound interest.
Present value
LO2.3.1: Calculate the present value of a

future cash sum using both a formula and
tables.
Geometric progression
Financial mathematics
LO2.3.2: Calculate the net present value

(NPV) of a project.
LO2.3.3: Use NPVs to choose between
mutually exclusive projects..
Future values
LO2.4.1: Calculate future values using both

simple and compound interest.
Annuities
LO2.4.1: Calculate the present value of an

annuity using both a formula and tables.
Internal rate of return
LO2.4.1: Explain with examples the use of

the internal rate of return of a project.
Interpolation and perpetuities
LO2.4.1: Calculate the present value of a

perpetuity.
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Contents
Level
Learning Outcome
Mathematics
Linear programming
Graphical solution to linear
programming problems involving
redundant constraints, bounded
and unbounded feasible regions,
no feasible solution and alternative
optimum solution
LO3.1.1: Demonstrate adequate expertise

in transforming a business problem into a
system of linear programming.
LO3.1.2: Identify constraints and cost

minimization or profit maximization
functions.
LO3.1.3: Identify the redundant constraint.
LO3.1.4: Use the Corner Point Theorem.
LO3.1.5: Prepare a graphical solution of a
linear programming problem.
LO3.1.6: Analyse a graphical solution and
identify whether it has a bounded or an
unbounded feasible region or no feasible
solution at all.
LO3.1.7: Analyse the solution of a linear
programming problem and identify
alternative and optimum solutions, if any
exist.
Calculus
Rules for differentiation- Sum,
difference, product and quotient
rules of differentiation
LO4.1.1: Demonstrate an adequate

understanding of rules of differentiation.
Marginal function, calculation of

revenue, cost and profit of marginal
unit
LO4.2.1: Make use of differentiation

techniques in determining marginal
functions.
LO4.2.2: Calculate revenue, cost and profit
of a marginal unit using differentiation
techniques.
Use of second order derivatives;

maxima, minima and point of
inflexion.
LO4.3.1: Demonstrate the application of

second order derivatives in calculating
maxima, minima and the point of inflexion.
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Contents
Level
Learning Outcome
Mathematics
Matrices and determinants
Fundamentals of matrices,
addition, subtraction, multiplication,
inverse of matrices
LO5.1.1: Demonstrate an adequate

knowledge of matrix algebra (addition,
subtraction and multiplication).
LO5.1.2: Calculate the determinant, adjoint

and inverse of a matrix.
LO5.1.3: Make use of the properties of
determinants while calculating
determinants.
Solution of simultaneous linear
equations using Cramers Rule and
Matrix Inverse Method
LO5.2.1: Represent simultaneous linear

equations in matrix form.
LO5.2.1: Solve simultaneous linear

equations using Cramers Rule and Matrix
Inverse Method.
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Contents
Level
Learning Outcome
Statistics
Presentation and use of data
Collection and tabulation of data
LO6.1.1: Classify different types of data.

LO6.1.2: Perform data collection through
various methods.
LO6.1.3: Organise and summarise data and
present it as a frequency distribution.
Presentation through graphs,

charts and diagrams, including
stem and leaf display, box and
whisker plot.
LO6.2.1: Present data using a simple bar

chart, a multiple bar chart and a component
bar chart.
LO6.2.2: Construct pie charts, histograms,

frequency polygons, ogives, stem and leaf
displays and box and whisker plots.
LO6.2.3: Analyse graphical representations
of data.
Measures of central tendencies

and measures of dispersions.
LO6.3.1: Calculate various measures of

central tendency such as mode, median,
arithmetic, geometric and harmonic means.
LO6.3.2: Analyse the advantages and

disadvantages of various central tendency
measures.
LO6.3.3: Identify the characteristics and
measures of dispersion.
LO6.3.4: Use measures of dispersion, such
as standard deviation or variance, to
ascertain the degree of variation or
variability in a distribution.
Index numbers
Index numbers, weighted index
numbers, concept of purchasing
power and deflation of income.
LO7.1.1: Define the index number and its

types.
LO7.1.2: Use different formulae/methods to

calculate various types of index number.
LO7.1.3: Analyse the uses and limitations of
index numbers. For example, use index
numbers to deflate or inflate a series and
explain the result.
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Contents
Level
Learning Outcome
Methods of least square and

regression
Scatter diagram, linear relationship,
simple linear regression lines by
method of least square.

scatter diagrams, including their
construction, uses and limitations.

the basic concept of regression lines and
how they are used.
LO8.1.3: Use least squares linear
regression to construct a regression line
(line of best fit).
LO8.1.4: Analyse regression lines.
LO8.1.5: Use a regression line to calculate
a forecast of the value of a dependent
variable where given the value of an
independent variable.
Simple linear correlation

the basic concept of correlation coefficient
analysis.
Coefficient of correlation and

determination
LO8.3.1: Calculate and analyse coefficients

of correlation and determination.
Rank correlation
LO8.4.1: Define rank correlation.

LO8.4.2: Calculate the rank correlation
coefficient between two sets of data and
explain the value.
Probability and probability

distribution
Counting techniques
LO9.1.1: Use counting techniques, like the

mn counting rule and factorials for
calculating, for example, a total number of
outcomes.
LO9.1.2: Use permutations and

combination to calculate the total number of
possible selections from a set of data.
Probability
LO9.2.1: Understand the definition of

probability and other basic terms as well as
their applications.
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xvi
Contents
Level
Learning Outcome
Probability and probability

distribution (continued)
Addition law for mutually exclusive
and not mutually exclusive events.
LO9.3.1: Use the addition rule while

calculating probabilities.
LO9.3.2: Identify the difference between
mutually exclusive and non-mutually
exclusive events.
Multiplicative laws for dependent

and independent events.
LO9.4.1: Identify the difference between

dependent and independent events.
LO9.4.2: The Use multiplication rule while
calculating conditional probabilities.
Binomial distribution
LO9.5.1: Account for the assumptions that

underlie the Binomial distribution.
LO9.5.2: Demonstrate the use of Binomial
distribution to calculate probabilities.
Poisson distribution
LO9.6.1: Account for the properties of the

Poisson distribution.
LO9.6.2: Demonstrate the use of the
Poisson distribution to calculate
probabilities.
Hyper-geometric distribution
LO9.7.1: Identify situations where Hypergeometric distribution could be used.

LO9.7.2: Demonstrate the use of Hypergeometric distribution to calculate
probabilities.
Normal distribution
LO9.8.1: Demonstrate the use of normal

distribution including the use of tables.
LO9.8.2: Demonstrate the application of the
normal distribution to calculate probabilities.

Simple random sampling
LO10.1.1: Understand the terms, population

and sample.
LO10.1.2: Explain methods for selecting a
simple random sample.
Sampling distribution of mean
LO10.2.1: Define and construct a sampling

distribution of the sample means.
LO10.2.2: Calculate the mean and standard
deviation of a sampling distribution of
sampling means.
14
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Contents
Level
Learning Outcome

(continued)
Standard error of mean
LO10.3.1: Calculate standard error of

mean.
Sampling with and without

replacement
LO10.4.1: Select an appropriate sampling

technique for calculating the probabilities of
sample means.
Testing of hypothesis for population

means, difference between
population means and population
proportion and difference between
two population proportions
LO10.5.1: Demonstrate the use of

hypothesis testing, significance testing and
testing a hypothesis.
LO10.5.2: Perform hypothesis test of
populations means based on small and
large samples
LO10.5.3: Perform hypothesis tests of the
difference between two population means
based on small and large samples
LO10.5.4: Perform hypothesis tests of the
difference between two population
proportions
LO10.5.5: Select appropriate distributions
i.e., z or t for constructing a confidence
interval for a population mean
Single population variance based

on test of Chi-square.
Use the Chi-square distribution to perform

tests of goodness of fit and independence.
Confidence interval for estimating

population means, proportions and
variance, and differences between
proportions means, proportions and
variance.
LO10.7.1: Construct the confidence interval

for population means and difference of
means.
Problems of determination of
sample size for the study of
population mean and proportion.
LO10.7.2: Construct the confidence interval

for population means and difference of
proportion and variance.
LO10.8.1: Calculate a sample size for an
interval estimate of a population mean.
LO10.8.2: Calculate a sample size for an
interval estimate of a population proportion.
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Introduction to Information Technology
Syllabus objective
INTRODUCTION TO INFORMATION TECHNOLOGY
Objective
To enable candidates to equip themselves with the fundamental skills and proficiency
required to cope with todays highly challenging IT oriented business environment.
Learning Outcome
The candidates will be able to:
LO1
describe and classify different elements of a computer system
LO2
describe the basic operations in commonly used operating systems
LO3
demonstrate performance level knowledge in Microsoft Excel
LO4
demonstrate performance level knowledge in Microsoft Word
LO5
demonstrate performance level knowledge in Microsoft PowerPoint
Grid
Weighting
A.
Computer hardware and types of operating system
10
B.
Microsoft Excel
40
C.
Microsoft Word
30
D.
Microsoft PowerPoint
20
16
Total
100
Syllabus
Ref
Contents
Computer hardware and

operating systems
1
Level
Central processing units

(CPUs) processor, hard
disk, random access
memory, read-only memory
Input devices Key board,

mouse, touch pads, Scanner
Output devices monitor,

printer
Learning Outcome
LO1.1.1
Explain the role and importance of
basic components of a CPU
LO1.2.1
State the uses and limitations of
common input devices
LO1.3.1
State the differences between CRT and
LCD/LED monitors
LO1.3.2
Classify different types of printers and
state their relative advantages and
limitations
Operating systems DOS,

Windows, Linux
Core Windows tasks

customize desktop and start
menus, work with files and
folders, log-on and log-off,
search for information, lock
the computer, use a screensaver password, reset a
password
LO2.1.1
State key operating system commands
used for efficient searches, formatting
disks, viewing IP configurations, testing
network connections and exploring the
network
LO2.2.1
State methods for customizing desktop
presentation and the start menu
LO2.2.2
Define techniques to work efficiently
with files and folders
LO2.2.3
State efficient ways to search for
required information from active and
archive files
LO2.2.4
State the important information that
could be recorded whilst a user is
logged-in
LO2.2.5
17
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Define basic controls and practices that

should be adopted by users for
safeguarding of data stored in
computers
Syllabus objective and learning outcomes
Syllabus
Ref
Contents
Microsoft Excel
1
Application of basic built-in

functions and formulae like
Sumif, Count, IF, Vlookup,
Average, Sub-total
Level
Learning Outcome
LO3.1.1
Demonstrate adequate command of
and perform Sumif, Count, Vlookup,
Average and Subtotal functions
LO3.1.2
Demonstrate effective use of functions
such as IF, AND, OR
Creating and modifying

customized data formats
LO3.2.1
Use appropriate Excel features to
create customized data formats for
storing currency and phone numbers
LO3.2.2
Modify existing data formats to enhance
readability
Using conditional formatting
LO3.3.1
Use the conditional formatting feature
to highlight exceptions
Protecting cells, worksheets

and workbook
Merging workbooks
LO3.4.1
Perform the steps to protect certain
cells, individual worksheets and an
entire workbook
LO3.5.1
Perform the steps to share a workbook
LO3.5.2
Perform the steps to merge multiple
copies of a shared workbook
Importing and exporting data

to and from Excel
LO3.6.1
Export data from Excel to other
applications and in other formats
LO3.6.2
Import data to Excel from other
applications and in other formats
Creating and editing

templates
LO3.7.1
Demonstrate adequate knowledge in
creating and editing Excel templates
18
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Syllabus
Ref
Contents
Microsoft Word
1
Creating custom style for

text, tables and lists
Level
Learning Outcome
LO4.1.1
Use various Word features to present
letters, reports and other documents in
a presentable custom style
LO4.1.2
Select an appropriate pre-defined table
style for improved presentation
Sorting contents in lists and

tables
Modifying table formats
LO4.2.1
Use Words built-in features to sort
contents saved in tables
LO4.3.1
Use formatting tools to improve
readability of data in tables
Creating and modifying a

table of contents
LO4.4.1
Identify the basic formatting
requirements to insert a table of
contents
LO4.4.2
Demonstrate performance level
knowledge to insert and modify a table
of contents
Inserting and modifying

endnotes, footnotes,
captions & cross references
LO4.5.1
Demonstrate performance level
knowledge to insert and modify
endnotes, footnotes, captions & cross
references
LO5.1.1
Select a template from PowerPoints
sample templates to construct simple
presentations
LO5.2.1
Perform inserting and editing of text
based content
LO5.3.1
Microsoft PowerPoint
1
Creating new presentations

from templates
Inserting and editing textbased content
Inserting, and editing tables,

charts, diagrams, pictures,
shapes, graphs and objects
Demonstrate performance-level
knowledge of inserting and editing
tables, charts and other objects in the
presentation
LO5.3.2
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Use appropriate PowerPoint features to

insert pictures, videos, graphs and
other objects in the presentation
Syllabus
Ref
Contents
Applying slide transitions
Level
2
Learning Outcome
LO5.4.1
Demonstrate performance-level
knowledge whilst applying meaningful
slide transitions
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Certificate in Accounting and Finance

Introduction to accounting
S
Syllabus objective
CERTIFICATE IN ACCOUNTING AND FINANCE
INTRODUCTION TO ACCOUNTING
Objective
To enable candidates to equip themselves with the fundamental concepts of accounts
needed as a foundation for higher studies of accounting.
Learning Outcome
1
understand the nature of accounting, elements of accounts and double entry rules.
identify financial transactions and make journal entries.
prepare general ledger accounts and a trial balance.
make period end adjustments prior to the completion of financial statements
prepare basic financial statements
prepare partnership accounts and account for transactions of admission,

retirement etc.
Grid
Weighting
Introduction to accounting and book keeping
40
Adjustments prior to completion of financial statements
20
Preparation of final accounts of sole traders
20
Accounting for partnerships
20
Total
100
21
Contents
Level
Learning Outcome
and bookkeeping
Meaning of business
LO1.1.1: Explain the characteristic of a

business
LO1.1.2: Classify transactions that fall under
the definition of business transactions
Mode of business organization

(meaning) - sole proprietorship;
partnership; limited company
LO1.2.1: Describe the key features of sole

proprietorship, partnership and limited
company
LO1.2.2: Differentiate the features of sole
proprietorship, partnership and limited
company
Fundamental accounting
concepts - accrual, consistency,
true and fair view, materiality,
prudence, completeness, going
concern, substance over form
LO1.3.1: Describe and illustrate the main

concepts, namely, accrual, consistency, and
completeness
LO1.3.2: Demonstrate familiarity with the
concepts of true and fair view, materiality,
prudence, going concern and substance over
form
LO1.3.3: Apply the concepts of accrual,
consistency and completeness to simple and
well explained circumstances.
Financial statementscomponents, responsibility,

presentation, users
LO1.4.1: List the components of a set of

financial statements.
LO1.4.2: Explain the characteristics and
purpose of the statement of financial position
and the statement of comprehensive income.
LO1.4.3: Identify the responsibility to prepare
and present financial statements
LO1.4.4: Describe the basic presentation
layout of statements of financial position and
statements of comprehensive income.
LO1.4.5: Identify users of financial
information and describe how the information
is useful to them
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Contents
Level
Learning Outcome
Bookkeeping
Elements of financial
statements (meaning) - Assets,
liabilities, equity, income,
expense
Chart of accounts
LO2.1.1: Define and give examples of

assets, liabilities, equity, income and
expenses
LO2.1.2: Apply the underlying concepts of
assets, liabilities, income and expenses in
simple and well explained circumstances.
LO2.2.1: Understand the meaning of a chart
of accounts
LO2.2.2: Explain the purpose of
establishing a chart of accounts
LO2.2.3: Construct a chart of accounts
using given data
Double entry system,

accounting equation and rules
of debit and credit
LO2.3.1: Understand and apply, the

accounting equation (Assets = Liabilities +
Equity) in simple practical and common
scenarios
LO2.3.2: identify financial and non-financial

transactions in a well defined scenario
LO2.3.3: Understand and apply the concept
of double entry accounting to simple and
common business transactions
General journal
LO2.4.1: List and describe the basic

contents of the general journal
LO2.4.2: prepare and use the general

journal to record journal entries
Sales journal and the sales
ledger
LO2.5.1: Describe the basic contents of the

sales day book and the customer/debtors
ledger
LO2.5.2: record entries in the sales day

book and the customer/debtors ledger.
Purchase journal and the
purchase ledger
LO2.6.1: Describe the basic contents of the

purchase journal and purchase
ledger/creditors ledger.
LO2.6.2: record entries in the purchase

journal and purchase ledger/creditors
ledger.
23
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Contents
Level
Learning Outcome
General ledger and trial

balance
General ledger
LO3.1.1: Describe the main features of the

general ledger
LO3.1.2: Post entries in the general ledger
Trial balance
LO3.2.1: Understand the purpose of the trial

balance
LO3.2.2: Understand and demonstrate
mapping between general ledger balances
and the trial balance
LO3.2.3: Identify the limitations of a trial
balance.
Adjustments before final

accounts
Straight line, diminution
balance, sum-of-years-digit,
number of units produced
methods and recording of
depreciation on fixed Assets
Allowance for bad debts and

write off
LO4.1.1: Calculate depreciation expense

using straight line, diminution balance, sumof-digits and number of units produced
methods
LO4.1.2: Post journal entry to record
depreciation expense
LO4.2.1: Estimate allowance for bad debts
based on a given policy
LO4.2.2: Post journal entry to record bad
debt expense
LO4.2.3: Compute and record write off and
understand its impact on allowance for bad
debts.
Prepayments and accruals
LO4.3.1: Understand the matching concept

that applies to prepayments and accruals.
LO4.3.2: Post journal entries and ledger
entries for prepayments and accruals.
LO4.3.3: Post adjusting entries to recognize
revenues or expenses
24
viii
Contents
Level
Learning Outcome

accounts (continued)
Closing entries of inventory
LO4.4.1: Understand the concepts of

periodic and perpetual inventory system
LO4.4.2: Identify the need to post the

adjustment entries of inventory at the end of
the period in case of periodic inventory
system.
LO4.4.3: Pass the adjusting entries and
ledger entries at the end of the period.
Bank reconciliation and related
adjustments
LO4.5.1: Understand the need for a bank

reconciliation
LO4.5.2: Identify the main reasons for

differences between the cash book and
bank statements.
LO4.5.3: Prepare a bank reconciliation
statement in the circumstance of simple and
well explained transactions.
LO4.5.4: Correct cash book errors and post
journal entries after identifying the same in
bank reconciliation statement.
Control accounts - reconciliation
and adjustments
LO4.6.1: Understand the mapping between

control accounts and subsidiary ledger for
accounts receivable and accounts payable.
LO4.6.2: Prepare control accounts and

subsidiary ledger from well explained
information provided.
LO4.6.3: Perform control accounts
reconciliation for accounts receivable and
accounts payable.
LO4.6.4: Identify errors after performing
reconciliation
LO4.6.5: Identify and correct errors in
control account and subsidiary ledgers.
25
ix
Contents
Level
Learning Outcome

accounts (continued)
Correction of errors in record
keeping
LO4.7.1: Identify the types of error which

may occur in a record keeping system
LO4.7.2: Calculate and understand the

impact of errors on the financial statements
within a reporting period
LO4.7.3: Prepare journal entries to correct
errors that have occurred within a reporting
period
Preparation of final accounts
of a sole trader
Statement of financial position
LO5.1.1: Understand the purpose of the

statement of financial position
LO5.1.1: Prepare simple statements of

financial position from information provided.
Statement of comprehensive
income
LO5.1.1: Understand the purpose of the

statement of comprehensive income

comprehensive income from information
provided
Receipt and payment accounts
LO5.1.1: Understand the purpose of a

receipts and payments account.
LO5.1.1: Prepare a simple receipts and

payments account from information
provided.
26
Contents
Level
Learning Outcome
Accounting for partnerships

Preparation of partnership
accounts
LO6.1.1: Define a partnership and state its

essential elements
LO6.1.1: Understand goodwill

LO6.1.1: Prepare
Capital account
Current account
LO6.1.1: Prepare a profit and loss account

and a statement of financial position of a
partnership.
Admission and amalgamation
LO6.1.1: Process the necessary

adjustments on the admission of a new
partner, namely:
Revaluation of assets and liabilities of

the firm
Treatment of goodwill
Application of new profit sharing ratio
LO6.1.1: Prepare the nominal accounts,

profit and loss account and statement of
financial position upon amalgamation of two
partnerships.
Retirement, death, dissolution,
liquidation
LO6.1.1: Make journal entries in the case of

the dissolution of a partnership to record:
transfer and sale of assets and

liabilities to third parties and partners,
payment of realization expenses,
closing of the realization account and
settlement of partners capital account.
LO6.1.1: Process the necessary

adjustments on the death or retirement of a
partner:
adjustments relating to goodwill,

accumulated reserves and
undistributed profits
revaluation account
adjustment and treatment of partners
capital;
application of new profit sharing ratio
27
xi

Introduction to economics and finance
Syllabus objective
INTRODUCTION TO ECONOMICS AND FINANCE
Objective
To enable candidates to equip themselves with the fundamental concepts of economics
and finance needed as foundation for higher studies of finance.
Learning Outcome
The candidate will be able to:
1
Understand the nature of micro-economics and its basic concepts.
Understand the nature of macro-economics and its relation with the measurement
of economic growth.
Understand how the balance of payments of a country is worked out.
Understand the nature of banking systems
Understand the basic function of financial markets.
28
The Institute of C hartere d Accountants of Pakistan
Grid
Weighting
Concepts of economics
10
Microeconomics
30
Macroeconomics
30
Introduction to banking system, financial markets and

international trade
30
Total
100
Syllabus
Ref
Contents
Level
Learning Outcome
Concepts of economics
1
The economic problem wants, resources, scarcity
LO1.1.1: Describe, with examples, the

economic problem
LO1.1.2: Discuss the production
possibility curve
Economic systems planned, market and mixed

economies
LO1.2.1: Describe the functions of an

economic system
LO1.2.2: Explain the features of
planned, mixed and market economies
LO1.2.3: Provide example of a mixed
economy, a planned economy and a
market economy
LO1.2.4: Describe the shortfalls of a
market economy
Islamic economic system
LO1.3.1: Describe the main features of

the Islamic economic system
Microeconomics
1
Microeconomics nature
LO2.1.1: Define micro economics and

discuss its scope
Demand and supply
LO2.2.1: Define law of demand and

explain its assumptions and limitations
LO2.2.2: Define law of supply and
explain its assumptions
Equilibrium of demand and

supply
LO2.3.1: Explain the determination of

price by equilibrium of demand and
supply
LO2.3.2: Explain the effect of changes
in demand and supply
29
vi
LO2.3.3: Discuss the determination of

price of perishable and durable goods
Syllabus
Ref
Contents
Elasticity of demand and
supply
Level
2
Learning Outcome
LO2.4.1: Define elasticity of demand
and briefly explain the measurement of
price, income and cross elasticity of
demand
LO2.4.2: Describe the determinants of
the elasticity of demand
LO2.4.3: Define elasticity of supply and
briefly explain the percentage and
graphical methods of measurement of
elasticity of supply
LO2.4.4: Describe the determinants of
supply elasticity
Utility analysis and

indifference curve
LO2.5.1: Explain the law of diminishing

marginal utility and discuss its
assumptions and limitations
LO2.5.2: Discuss the meaning and
characteristics of indifference curves
LO2.5.3: Explain consumers
equilibrium through indifference curve
analysis
Cost and revenue curves
LO2.6.1: Discuss short run curves of

total cost, total fixed cost, total variable
cost, average cost and marginal cost
LO2.6.2: Derive a long run average
cost curve from a short run average
cost curve
LO2.6.3: Derive a long run marginal
cost curve
LO2.6.4: Discuss revenue curves under
perfect and imperfect competition
Equilibrium of firm short and

long term under perfect
competition, monopoly,
oligopoly and monopolistic
conditions
LO2.7.1: State the features of perfect

and imperfect competition
LO2.7.2: Discuss the short and long
run equilibrium of firms under perfect
and imperfect competition
30
vii
Syllabus
Ref
Contents
Laws of increasing and
diminishing returns
Level
2
Learning Outcome
LO2.8.1: Explain the law of increasing
returns and its application and
assumptions
LO2.8.2: Explain the law of diminishing
returns and its application and
assumptions
Macroeconomics
1
Measurement of national
income including knowledge
of basic concepts like GDP,
GNP, NNP;
Consumption, saving and

investment functions;
LO3.1.1: Define gross national product,

gross domestic product and net
national product
LO3.1.2: Explain the product approach,
income approach and expenditure
approach to the measurement of
national income
LO3.2.1: Understand the meaning of
consumption and saving and its
relationship with the income
LO3.2.2: Identify how Keynes
Psychological law of consumption
explains the relationship between
consumption and income with the help
of average propensity to consume and
marginal propensity to consume curves
LO3.2.3: Understand the determinants
of the consumption function
LO3.2.4: Understand the stability of
consumption and saving functions in
the short run and discuss the reasons
thereof
investment, induced investment and
autonomous investment
LO3.2.6: Explain the relationship of
investment with marginal efficiency of
capital and interest rate.
Marginal propensity to
consume and save
LO3.3.1: Discuss the marginal

propensity to consume and save
31
viii
Syllabus
Ref
Contents
Multiplier and accelerator;
Level
2
Learning Outcome
LO3.4.1: Comprehend the effect of the
multiplier on the level of national
income
LO3.4.2: Understand the assumptions
which underlie the multiplier concepts
LO3.4.3: Comprehend the principle of
acceleration of derived demand
LO3.4.4: Understand how the multiplier
and accelerator interact
LO3.5.1: Understand the main

functions of money
Money and its value
LO3.5.2: Understand credit money and

its advantages and disadvantages
LO3.5.3: Understand sources of the
money supply
LO3.5.4: Understand the quantity
theory of money
LO3.5.5: Understand the measurement
of the value of money
LO3.5.6: Understand inflation and its
kinds
LO3.5.7: Understand the causes of
inflation and measures for overcoming
inflation
6
Growth and recession
LO3.6.1: Understand different phases

of the business cycle
LO3.6.2: Understand the indicators of
growth and recession
Fiscal budget
LO3.7.1: Explain the objectives of fiscal

policy and how they are achieved
through fiscal budgets
Direct and indirect taxation
LO3.8.1: Define direct and indirect

taxation
LO3.8.2: Explain the advantages and
disadvantages of direct taxation
LO3.8.3: Explain the advantages and
disadvantages of indirect Taxation
32
ix
Syllabus
Ref
Contents
Level
Learning Outcome
Introduction to banking system, financial markets and international trade

Banking system
1
Credit formation by banks
LO5.1.1: Explain the process of

creation of credit money by the banks
LO5.1.2: Discuss the limitations on the
creation of credit
Role of Central Bank;
LO5.2.1: Describe the functions of a

central bank
Monetary policy

monetary policy
LO5.3.2: Understand the objectives of
monetary policy and the mutual conflict
of the objectives
Types of banks and financial

institution
LO5.4.1: Define a bank and describe

different kind of banks
Financial instruments and market-Meaning

1
Shares, debentures, bonds,

futures, options, cap, floor,
collar, swaps, forward

shares, debentures, bonds, futures,
options, cap, floor, collar, swaps,
forward
Money market

money markets
Capital markets.

capital and capital markets
Derivative market

derivatives and derivative markets
International trade
1
Balance of trade and

payment
LO4.1.1: Understand the nature of

items that are included in balance of
trade and payment
LO4.1.2: Understand the different parts
of balance of payment
33

Business Law
Syllabus objective
BUSINESS LAW
Objective
To give students an understanding of the legal system and commercial laws; and build a
knowledge base of corporate laws.
Learning Outcome
The candidate will be able to demonstrate:
1
Basic knowledge of the legal environment.
Comprehension of law governing contracts, partnership and negotiable

instruments.
Knowledge of the legal terminology of company law and the basics of company
incorporation.
Familiarity with the provisions governing the issuance of shares.
Knowledge of the management of companies.
Familiarity with investment by companies, nancial accounts and distribution of

prot.
Knowledge of the appointment of auditors and their responsibilities and duties.
34
Business Law
Grid
Weighting
5
Introduction to legal system

Mercantile law
Contract Act 1872
25
Partnership Act 1932
10
Negotiable Instrument Act 1881
10
Companies Ordinance 1984

Sections 1 to 51 of the Companies Ordinance, 1984
10
10
Sections 142 to 204A of the Companies Ordinance, 1984
10
10
10
Total
100
Syllabus
Ref
Contents
Level
Learning Outcome
Introduction to the Legal System

Sources and process of legislation
1
Sources of law and an

introduction to the
Constitution of Pakistan
Process of legislation and

legal system in Pakistan
LO 1.1.1: Briefly describe sources of

law in Pakistan
LO 1.1.2: Describe the basic structure
of the constitution of the Islamic
Republic of Pakistan
LO 1.2.1: Define legislation and
describe its forms.
LO 1.2.2: Briefly describe the process
of legislation as per the Constitution.
LO 1.2.3: Identify the structure of the
courts in Pakistan
.
Mercantile law
Contract Act 1872
1
All sections
35
vi
LO 2.1.1: Discuss the provisions of the

act with respect to the following and
demonstrate comprehension in simple
scenario based problems)
communication, acceptance and
revocation of proposals
Syllabus
Ref
Contents
Level
Learning Outcome
contracts, voidable contracts and
void agreements
Contingent contracts
performance of contracts
breach of contract
indemnity and guarantee
bailment and pledge
contract of agency
Partnership Act 1932

1
Chapter I Preliminary
LO 2.2.1: Dene the terms
Chapter II - The nature of

partnership
LO 2.3.1: Understand and describe the

partnership relationship and its creation
and identify which mode determines
existence of a partnership.
Chapter III - Relations of

partners to one another
LO 2.4.1: Determine the rights and

duties of partners of the rm over
property of the rm in given situations.
Chapter IV - Relations of
partners to third parties
LO 2.5.1: Describe the relationship of

partners with third parties.
LO 2.5.2: Identify the implied authority
of the partner in relation to third parties,
liability of a partner for acts of the rm
and liability of the rm for wrongful acts
of a partner in given situations.
LO 2.5.3: Identify the rights and
liabilities of a minor admitted to the
benets of partnership:
Negotiable Instruments Act 1881

1
Denitions and meanings

(Section 1 to 25)
LO 2.6.1: Dene and explain terms.

LO 2.6.2: Explain types of negotiable
instruments.
Discharge of liability
(Section 82 to 90)
LO 2.7.1: Identify how the maker of a

negotiable instrument is discharged
from his liability under given scenarios.
Provisions relating to
cheques (Section 122A to
131C)
LO 2.8.1: Describe crossing of cheques

LO 2.8.2: Differentiate between a
cheque crossed generally and a
cheque crossed specially and their
payment modes.
36
vii
Business Law
Syllabus
Ref
Contents
Level
Learning Outcome
Companies Ordinance 1984

Preliminary and incorporation (Sections 1 to 51)
1
Definitions (Section 2)
LO 3.1.1: Define the terms which are

relevant to the areas covered in the
syllabus
Meaning of "subsidiary" and

"holding company"
(Section 3)
LO 3.2.1: Explain subsidiary and

holding company and when a company
becomes a subsidiary or holding
company of another company.
LO 3.2.2: Apply the concept of
subsidiary in simple scenarios.
Powers and functions of the

Commission (Section 12)
LO 3.3.1: Demonstrate familiarity with

the powers and functions of the
Commission.
Memorandum of association
(Section 15 to 25)
LO 3.4.1: Describe the memorandum of

association and state its purpose.
LO 3.4.2: List the clauses of
memorandums of association of various
types of companies.
LO 3.4.3: Describe the purpose and
procedure of alteration to different
clauses of a memorandum of
association.
Articles of association
(Section 26)
LO 3.5.1: Define the articles of

association and state its purpose.
LO 3.5.2: State the information which
should be contained in the articles of
various companies.
Registration of
memorandum and articles of
association
(Section 30 to 36)
Provisions with respect to

names of companies
(Section 37 to 41)
LO 3.6.2: Describe the effects of

registration of the memorandum and
articles of association.
37
LO 3.6.1: Describe the procedure of

registration of the memorandum and
articles of association
viii
LO 3.7.1: Describe with examples the

prohibitions with regard to the selection
of the name of a company.
LO 3.7.2: Identify the actions and
procedures needed to be taken by
company and registrar, if a company is
registered by a prohibited name.
Syllabus
Ref
Contents
Level
Learning Outcome
Association not for prot

(Section 42)
LO 3.8.1: Comprehend the nature of

association not for prot.
Companies limited by
guarantee (Section 43)
LO 3.9.1: Understand the provisions

regarding divisible prot and dividing
the undertaking into shares or interest.
Allotment of shares, registration of charge etc. (Sections 52 to 136)

1
Prospectus, allotment, issue

and transfer of shares and
debentures, deposits, etc.
(Section 52 to 57)
LO 4.1.1: Dene a prospectus and

explain its purpose.
LO 4.1.2: Understand the requirements
relating to a prospectus as laid down in
Section 52, 53 (1), (5) and (8)
LO 4.1.3 Describe the matters that are
to be specied in a a prospectus as
required under clause 1 to 7 and 17, 18
19, 24, 26 and 27 of Section 1 of Part I
of Second Schedule.
LO 4.1.4: Describe the reports that are
to be included in a prospectus as
required under Section 2 of Part I of
Second Schedule.
regarding statement and consent of
expert.
Share capital and

debentures
(Section 89 to 95 and 108)
LO 4.2.1: Describe the nature of shares

and share certicates
LO 4.2.2: Describe the classes and
kinds of shares
LO 4.2.3: Describe with simple
example the condition of fully paid
shares.
LO 4.2.4: State with simple examples
the kinds of alterations can be made to
the share capital.
LO 4.2.5: State the rules on prohibition
of purchase of a companys own or its
holding companys shares.
LO 4.2.6: Understand the meaning of
variation of shareholders right.
38
ix

the procedure for cancellation of
variation of shareholders right.
Business Law
Syllabus
Ref
Contents
Registration of mortgages,
charges etc.
(Section 121, 129, 132 and
136)
Level
1
Learning Outcome
LO 4.3.1: Discuss the meaning of
mortgage/charge with simple examples,
and the duty of company and the
procedure for registration of charges.
LO 4.3.2: State the right of an
interested party in respect of a
registration of mortgage/charge.
LO 4.3.3: State the duty and procedure
of payment or satisfaction of
mortgage/charge.
the right to inspect the instrument
creating a mortgage/charge.
LO 4.3.5: Discuss the consequences of
registered and unregistered
mortgages/charges.
Management and administration (Sections 142 to 204A)

1
Registered office,
publication of names etc.
(Section 142 to 145)
LO 5.1.1: Discuss with simple

examples the provisions with regard to
having a registered office, publication of
name and publication of paid-up capital.
Commencement of business
by a public company
(Section 146)
LO 5.2.1: State the conditions to be

fulfilled before commencement of
business by a company.
LO 5.2.2: State the applicability and
non-applicability of the conditions on
different kinds of company.
Meeting and proceedings

LO 5.3.1: State the timing, matters and

reports relating to statutory meetings.
reports relating to an annual general
meeting using simple examples.
LO 5.3.3: State who can call an annual
general meeting.
reports relating to an extraordinary
general meeting
LO 5.3.5: State who can call an
extraordinary general meeting.
39
LO 5.3.6: State the quorum for a

general meeting
Syllabus
Ref
Contents
Level
Learning Outcome
LO 5.3.7: State the entitlement of a
member in respect of appointment of
proxy and conditions applicable
thereon.
LO 5.3.8: Describe the provisions
relating to minutes of meetings
Directors
(Section 174 to 197A)
LO 5.4.1: Explain and apply in given

scenarios, the legal provision with
respect to directors:
Eligibility
Number
Elections
Vacation of ofce
Powers, duties and liabilities
LO 5.4.2: State the legal restrictions on
a company with reference to loans to
directors
Chief executive
(Section 198 to 204A)
LO 5.5.1: Explain the appointment of

rst chief executive and subsequent
chief executives using simple
examples.
LO 5.5.2: State the conditions
applicable on appointment, removal,
engagement in any business
LO 5.5.3: State the provisions relating
to appointment of a secretary
Investments, accounts etc. (Sections 208 to 251)

1
Investment in associated
companies and undertakings
(Section 208)
LO 6.1.1: Describe the conditions

applicable to a company for making
investment in associated companies
and undertakings.
Investment of companies to
be held in its own name
(Section 209)
LO 6.2.1: Discuss with simple

examples as to how a company can
hold its investment in names other than
its own name.
Disclosure of interest by
directors (Section 214)
LO 6.3.1: Explain the requirements of

disclosure of interest by director in
contract / arrangement entered into by
or on behalf of the company.
40
xi
Business Law
Syllabus
Ref
Contents
Level
Learning Outcome
Interest of other officers etc.

(Section 215)
LO 6.4.1: Explain the requirements of

disclosure of interest by officers in
contract / arrangement entered into by
or on behalf of the company.
Interested director not to

participate or vote in
proceedings of directors
(Section 216)
LO 6.5.1: Describe the participation of

interested director in the proceedings of
directors in contract / arrangement
entered into by or on behalf of the
company
Accounts (Section 230, 233,

236, 241 and 242 )
LO 6.6.1: List the books of accounts to

be kept by company
LO 6.6.2: Explain the major
requirements with respect to the annual
accounts and the balance sheet.
LO 6.6.3: Describe the contents of a
directors report
LO 6.6.4: Describe the authentication
of balance sheet and profit and loss
account
LO 6.6.5: Discuss requirements of filing
of balance sheets and profit and loss
accounts with the registrar.
Dividend
LO 6.7.1: Explain the requirement

relating to declaration of dividend and
identify certain restrictions on
declaration of dividend.
applicable to payment of dividend.
Audit (Sections 252 to 257)

1
Audit (Section 252 to 257)
LO 7.1.1: Explain the provisions

applicable to
Appointment and remuneration of
auditors
Qualification and disqualification of
auditors
An auditors right to access the
record and information
An auditors duty to report and
contents thereof
Signature of an audit report
41
xii

Business management and behavioural studies
S
Syllabus objective
BUSINESS MANAGEMENT AND BEHAVIOURAL STUDIES
Objective
To equip candidates with the fundamentals of management and behaviuoral studies.
Learning Outcome
1
Demonstrate an understanding of the nature of management concepts and

approaches
Show familiarity with the structure of business organizations, their culture and the
change process
Demonstrate an understanding of human behavior
Demonstrate an understanding of the concepts of motivation
Show familiarity with the nature and kinds of leadership
Show familiarity with the nature and importance of negotiation and conflict
resolution
Demonstrate a basic understanding of IT based management information systems
42
Business management and behavioral studies
Grid
Weighting
Management concepts
25
Organizational process
20
Individual behavior and motivation
20
Leadership, negotiation and conflicts
20
Management information system
15
Total
100
Syllabus
Ref
Contents
Level
Learning Outcome
Management concepts
1
Meaning
LO 1.1.1 Define the term Management,

its nature and purpose
LO 1.1.2 State the difference between
Managers and Leaders using examples
LO 1.1.3 Describe the classification of
management roles by Henry Mintzberg
Functions
LO 1.2.1 Illustrate management model

and explain the functions of
management
LO 1.2.2 Describe the roles and skills
of management
Classical approach
LO 1.3.1 Describe the principles of

Scientific management by Fredrick
Taylor
LO 1.3.2 Explain the key principles of
management by Fayol and Urwick
LO 1.3.3 Discuss the criticism on
scientific management and classical
approach to management
LO 1.3.4 List the characteristics of
bureaucratic organizations and discuss
criticism on this form of management
Behavioral approach
LO 1.4.1 Discuss the Hawthorne

experiments on human relation
approach, their significance and
implications.
LO 1.4.2 Discuss critically the
relevance of these experiments for
management and organizational
behaviour.
43
vi
LO 1.4.3 Discuss Theory X and Theory
Syllabus and learning outcomes
Syllabus
Ref
Contents
Level
Learning Outcome
Y including their implication and
differences
Management science
approach
LO 1.5.1 Explain the effects of

operations research in business
sciences
External factors
Competitors, suppliers,
labour, customers
LO 1.6.1 Describe the direct and

indirect interactive forces which may
affect the organizational environment
General environment Political, legal, technological,

economic, social
LO 1.7.1 Explain how the external

forces affect the organizational
environment using examples.
LO 2.1.1 Explain the meaning and

nature of organizational structure.
Organizational process
1
Organizational structure principles of organization,

different ways of structuring
organization
LO 2.1.2 Explain the importance of

good structure and consequences of a
deficient structure.
LO 2.1.3 Describe how the elements of
organizational structure can be
combined to create mechanistic and
organic structures
LO 2.1.4 Describe the advantages and
disadvantages of mechanistic and
organic structure of organization
Organizational change nature of change process,

resistance to change
LO 2.2.1 Identify the external forces

creating change on the part of
organizations
LO 2.2.2 Describe process of
organizational change
LO 2.2.3 Explain the forms of reactions
to change
Organizational culture concept, dysfunctional

aspect of culture
LO 2.3.1 Describe organizational

culture using examples
LO 2.3.2 Discuss using examples the
different levels of organizational culture
Individual behavior and motivation

1
Perception
LO 3.1.1 Explain perception and

perception process
difference between sensation and
perception
44
vii

internal and external factors that affect
Syllabus
Ref
Contents
Level
Learning Outcome
perceptual selectivity
LO 3.1.4 Describe the characteristics of
Perceiver and Perceived
LO 3.1.5 Analyse the perceptual
problems/distortions in dealing with
other people like stereotyping and Halo
effect etc.
Attitude
LO 3.2.1 Define attitude and its

components with reference to culture of
an organization
LO 3.2.2 Discuss the differences
between cognitively based attitudes
and affectively based attitudes
LO 3.2.3 Describe the difference
between implicit and explicit attitudes
LO 3.2.4 Discuss cross-cultural
differences in the bases for attitudes
LO 3.2.5 Explain the relationship
between attitude and behaviour
Job satisfaction and stress
LO 3.3.1 Explain using examples the

meaning of job satisfaction.
LO 3.3.2 Identify the outcomes of job
satisfaction and ways to enhance
satisfaction
LO 3.3.3 Describe stress and identify
the causes of job stress
LO 3.3.4 Explain using examples the
general categories of stressors that can
affect job
LO 3.3.5 Identify consequences of
stress and strategies in order to cope
up with stress
Maslow need hierarchy

Model
LO 3.4.1 Describe using examples

motivation
LO 3.4.2 Explain Maslows need
hierarchy theory
LO 3.4.3 Explain strengths and
problems in applications of Maslows
theory
Herzbergs Two-factor
Theory
LO 3.5.1 Explain Herzbergs two factors

of motivation and major criticism
thereon
45
viii
Syllabus
Ref
Contents
McClellands theory of
needs
Level
2
Learning Outcome
LO 3.6.1 Explain the three motives by
McClelland.
LO 3.6.2 State the difference between
intrinsic and extrinsic motives
Goal setting
LO 3.7.1 List the major dimensions of

goal setting theory
LO 3.7.2 Explain why and how goals
contribute to self-motivation
LO 3.7.3 Describe how to set effective
goals and the problems sometimes
created by goals
Management by objective
LO 3.8.1 Explain the basic steps of the

overall performance system of MBO.
Self-efficacy
LO 3.9.1 Define the term self-efficacy

LO 3.9.2 Understand high self-efficacy
and low self-efficacy
10
Reinforcement
LO 3.10.1 Describe law of effect using

simple examples
LO 3.10.2 Describe reinforcement as
used in behavioural management
LO 3.10.3 Describe positive and
negative reinforcers using examples
11
Equity/organizational justice
LO 3.11.1 Explain organizational justice

and three components of the same,
namely, distributive, procedural and
interactional
12
Expectancy
LO 3.12.1 Describe using simple

examples the Expectancy theory and its
three elements, namely, expectancy,
instrumentality and valence
Leadership, negotiation and conflicts

1
Type of leadership
LO 4.1.1 Discuss different leadership

styles, namely, free-rein, engaging,
participative, task oriented and
autocratic
Theories of leadership
LO 4.2.1 Discuss using simple

examples different theories of
leadership, namely, trait theories, Blake
and Mouton theory, situational and
contingency theories
Roles, activities, skills of

leaders
LO 4.3.1 Discuss leadership roles and

activities
46
ix
LO 4.3.2 Identify Skills needed for
Syllabus
Ref
Contents
Level
Learning Outcome
effective leadership
Group Dynamics and

teamwork - types of groups,
group formation, group
structure, individual in
groups, team work
LO 4.4.1 List differences between

groups and teams
LO 4.4.2 Explain and illustrate balance
theory of group formation
LO 4.4.3 Identify and describe stages
of group development
LO 4.4.4 List down the factors that
increase and decrease group
cohesiveness
LO 4.4.5 Explain the ways to make
teams more effective
Negotiation skills
LO 4.5.1 Explain various stages of the

negotiation process
LO 4.5.2 List five skills of effective
negotiator
LO 4.5.3 Explain the low risk
techniques of negotiation
LO 4.5.4 Explain the high risk
techniques of negotiation
Conflict resolution
LO 4.6.1 Discuss the conflict resolution

process
LO 4.6.2 Explain Intra-individual conflict
with model of frustration
LO 4.6.3 List some of the physical,
psychological and behavioural
problems occur due to conflict
Management information systems

1
General system concepts of

information technology
LO 5.1.1 Demonstrate basic

understanding of computer hardware
i.e. input, output, storage of information
and networking
LO 5.1.2 Understand the concepts of
information technology and information
systems.
LO 5.1.3 Understand the role and types
of information systems in business
IT-based transaction
processing systems
LO 5.2.1 Understand data entry, batch

processing, online processing and real
time -online processing
IT-based financial reporting
LO 5.3.1 Understand IT based financial
47
x
Syllabus
Ref
Contents
Level
systems
Learning Outcome
reporting system
IT-based order processing

and inventory control
systems
LO 5.4.1 Understand IT based order

processing and inventory control
systems
IT-based personnel systems
LO 5.5.1 Understand IT based

personnel systems
Integrated IT systems
LO 5.6.1 Briefly describe integrated

systems, their advantages and
disadvantages
LO 5.6.2 Understand main feature of
Enterprise Resource Planning
48
xi

Financial accounting and reporting I
Syllabus objectives
FINANCIAL ACCOUNTING AND REPORTING I
Objective
To provide candidates with an understanding of the fundamentals of accounting theory and
basic financial accounting with particular reference to international pronouncements.
Learning Outcome
1
prepare financial statements in accordance with specified international

pronouncements.
account for simple transactions related to inventories and property, plant and
equipment in accordance with international pronouncements.
understand the nature of revenue and be able to account for the same in
accordance with international pronouncements.
account for simple transactions between head office and branches.
Grid
Weighting
Preparationofcomponentoffinancialstatements
20
Income and expenditure account and preparation of accounts from
20
incompleterecords
Accountingforinventories;andproperty,plantandequipment
35
Revenueaccounting
15
Branchaccounts
10
Total 100
49
Contents
Level
Learning Outcomes
Preparation of components
of financial statements with
adjustments included in the
syllabus
Preparation of statement of
financial position (IAS 1)
LO1.1.1: Prepare simple statement of financial

position in accordance with the guidance in
IAS 1 from data and information provided
comprehensive income (IAS 1)
LO1.2.1: Prepare simple statement of

comprehensive income in accordance with the
guidance in IAS 1 from data and information
provided
cash flows (no format
specified)
LO1.3.1: Compute items which are presented

on the statement of cash flows
Income and expenditure

account
LO1.4.1: Prepare simple income and

expenditure account using data and
information provided
Preparation of accounts from

incomplete records
LO1.5.1: Understand situations that might

necessitate the preparation of accounts from
incomplete records (stock or assets destroyed,
cash misappropriation or lost, accounting
record destroyed etc.)
LO1.3.2: Prepare a statement of cash flows

under any standard method
LO1.5.2: Understand and apply the following

techniques used in incomplete record
situations:
Use of the accounting equation

Use of opening and closing balances of
ledger accounts.
Use of a cash and / or bank summary
Use of markup on cost and gross and net
profit percentage
50
vi
Contents
Level
Learning Outcomes
Accounting for inventories

(IAS 2); and property, plant
and equipment (IAS-16)
Application of cost formulas
(FIFO/ weighted average cost)
on perpetual and periodic
inventory system
LO2.1.1: Understand and analyze the

difference between perpetual and periodic
inventory systems.
LO2.1.2: Understand and analyze the
difference between FIFO and weighted
average cost formulas and use them to
estimate the cost of inventory).
LO2.1.3: Account for the application of cost
formulas ( FIFO/ weighted average cost) on
perpetual and periodic inventory system
LO2.1.4: Identify the impact of inventory
valuation methods on profit.
Cost of inventories (cost of

purchase, cost of conversions,
other costs)
LO2.2.1: Calculate cost of inventory in

accordance with IAS-2 using data provided
including cost of purchase, cost of
conversions, and other costs.
LO2.2.2: Identify relevant and irrelevant cost
from data provided.
Measurement of inventories
(lower of cost or net realizable
value)
LO2.3.1: Describe net realizable value (NRV)

LO2.3.2: Explain the situation when the cost of
inventories may not be recoverable.
LO2.3.3: Demonstrate the steps in measuring
inventory at lower of cost or NRV.
LO2.3.4: Post journal entries for adjustments
in carrying value (excluding reversal of write
downs)
Presentation of inventories in
financial statements
LO2.4.1: Understand the disclosure

requirements and prepare extracts of
necessary disclosures (excluding pledged
inventories and reversal of write downs).
Initial measurement of
property, plant & equipment
(components of cost, exchange
of assets)
LO2.5.1: Calculate the cost on initial

recognition of property, plant and equipment in
accordance with IAS-16 including different
elements of cost and the measurement of cost
51
vii
Contents
Level
Learning Outcomes
IAS 2 and IAS-16 (continued)

Measurement after recognition
of property, plant and
equipment
LO2.6.1: Present property, plant and

equipment after recognition under cost model
and revaluation model using data and
Depreciation - depreciable
amount, depreciation period
and depreciation method
LO2.7.1: Define depreciation, depreciable

amount and depreciation period
LO2.7.2: Calculate depreciation according to
the following methods
straight-line,
diminishing balance
the units of production
LO2.7.3: Compute depreciation for assets

carried under the cost and revaluation models
using information provided including
impairment.
LO2.7.4: Prepare journal entries and ledger
accounts.
De-recognition
LO2.8.1: Describe de-recognition of property,

plant and equipment
LO2.8.2: Post journal entries to account for derecognition using data provided
Revenue accounting
Revenue (IAS-18)
LO3.1.1: Describe revenue

LO3.1.2: Describe and demonstrate the
accounting treatment (measurement and
recognition) for revenue arising from the
following transactions and events:
sale of goods;
rendering of services
use by others of entity assets yielding
interest, royalties and dividends.
52
viii
Contents
Level
Learning Outcomes
Branch accounts
Branch accounts (excluding
foreign branches)
LO4.1.1: Describe the special features of

branch accounting including differences to
routine accounting
LO4.1.2: Understand and apply the treatment
of branch inventory, branch mark-up, goods
sent to branch and branch debtors; in the
books of head office
LO4.1.3: Prepare trading/income statement of
branch.
53
ix

Principles of Taxation
S
Syllabus objectives
PRINCIPLES OF TAXATION
Objective
To provide basic knowledge in the understanding of objectives of taxation and core areas
of Income Tax Ordinance, 2001, Income Tax Rules 2002 and Sales Tax Act 1990 and
Sales Tax Rules.
Learning Outcome
The candidate will be able to:
1
Understand the objective of levy of taxation, and its basic concepts
Understand the system of taxation in Pakistan
Understand the historical background of taxation in Pakistan
Understand constitutional provisions of taxation in Pakistan
Understand and explain the basic ethics of taxation
Understand and explain provisions of Income Tax law mainly relevant to

individuals and association of persons
Understand and explain Sales Tax law relevant to operational level tasks
54
Grid
Weighting
2EMHFWLYHV\VWHPDQGKLVWRULFDOEDFNJURXQG
&RQVWLWXWLRQDOSURYLVLRQVDQG(WKLFV

,QFRPHWD[

6DOHVWD[

Total
100
Syllabus
Ref
Contents
Level
Learning Outcome
Basic concepts of taxation

1
Objectives
LO 1.1.1: Comprehend the main

objectives of taxation
LO 1.1.2: Justify Taxation as means of
development
LO 1 2.1: Understands the implication
of direct and indirect taxation
Basic concept
System of taxation in
Pakistan
LO 1.3.1: Comprehend different kinds

of taxes and their scope
LO 1.4.1: State the history of taxation in

sub-continent

the Federal Consolidated Fund and
Public Account
(Income Tax, Sales Tax,

Federal Excise Tax, Capital
Value Tax, Customs)
4
Historical background
Constitutional provisions
1
Federal financial procedures

(Article 78 to 88 of the
Constitution of Pakistan)

the expenditure that can be charged
upon Federal Consolidated Fund
2
Provincial financial
procedures
(Article 118 to 127 of the


the Provincial Consolidated Fund and
Public Account
the expenditure that can be charged
upon Provincial Consolidated Fund
55
vi
Syllabus
Ref
Contents
Distribution of revenues
between Federation and the
Provinces
Level
1
Learning Outcome
the formation of National Finance
Commission and its main function.
the taxes that can be raised under the
authority of Parliament
(Article 160 to 165A of the


the powers of provincial assemblies in
respect of professional tax
the exemption available to federal and
provincial governments
the tax on corporation owned by federal
and provincial government
4
Federal legislative lists

relating to revenue
generating measures
LO 2.4.1: Enlist the revenue collection

mentioned at S. No. 43 to 53 in Fourth
Schedule attached to the Constitution
(related part of Fourth

Schedule to the Constitution
of Pakistan)
C
Ethics
1
Ethics for tax legislation
LO 3.1.1: Describe how canons of

taxation developed by economist are
relevant for legislators while formulating
tax policies
Ethics for taxpayers
LO 3.2.1: Understand the right and

purpose of state to tax its citizen
LO 3.2.2: Understand morality behind
compliance with tax laws
Ethics for tax implementing

authorities
LO 3.3.1: Understand the powers Vs

ethical responsibilities of tax
implementation authorities
LO 3.3.2: Understand pillars of tax
administration, namely, fairness,
transparency, equity and accountability
Tax evasion and avoidance
LO 3.4.1: Explain with simple examples

the basic difference between evasion
and avoidance of tax
56
vii
Syllabus
Ref
Contents
Level
Learning Outcome
,QFRPH7D[
1
(concepts of terms defined
section 2 sub-section 1, 5,
5A, 6, 7, 9, 10, 11A, 19,
19C, 20, 21, 22, 23, 29, 29A,
29C, 36, 37, 38, 41, 44A, 46,
47, 49, 50, 51, 52, 53, 68)
Chapter II Charge of tax

(excluding section 7)
Chapter III Tax on Taxable

income (Excluding Section
29A, 30 and 31)
LO 4.3.1: Compute taxable income and

tax thereon relating to salary, income
from property, income from business,
capital gain, dividend, profit on debt,
ground rent, rent from sub-lease,
income from provision of amenities,
utilities or any other services connected
with rented building and consideration
for vacating the possession of building
Chapter IV (Part I, II and

III) Common rules
(Excluding Sections 78 and
79)
LO 4.4.1: Understand and apply on

simple scenarios provisions for income
of joint owner, apportionment of
deductions, fair market value and
receipt of income
LO 4.1.1: Describe the definitions given

in section 2 sub-section 1, 5, 5A, 6, 7,
9, 10, 11A, 19, 19C, 20, 21, 22, 23, 29,
29A, 29C, 36, 37, 38, 41, 44A, 46, 47,
49, 50, 51, 52, 53, 68
LO 4.1.2: Describe other definitions
covered under relevant sections
LO 4.1.3: Apply definitions on simple
scenarios
LO 4.2.1: Explain the chargeability of
tax with simple examples
LO 4.4.2: Explain using simple

examples the provisions relating to tax
year
LO 4.4.3: Explain with simple examples
the provisions relating to disposal and
acquisition of assets, cost and
consideration received
5
Chapter V Part I Central

concepts

examples the meaning of persons,
resident and non-resident persons and
associates
Chapter V Part II Div I and II

Individuals (Excluding
Section 88A)

examples the principles of taxation of
individuals
Chapter V Part III

Association of persons

examples the principles of taxation of
association of persons
57
viii
Syllabus
Ref
Contents
Level
Learning Outcome
Chapter VII Part II

Taxation of foreign-source
income of residents
LO 4.8.1: Understand the applicability

of tax on foreign salary income, credit
against foreign tax and treatment of
foreign loss of a resident on simple
scenarios.
Chapter X Part I Returns
LO 4.9.1: Identify persons required to

furnish a return of income
LO 4.9.2: Identify persons not required
to furnish a return of income
LO 4.9.3: Identify persons required to
furnish wealth statements
LO 4.9.4: List the contents of wealth
statement
10
Chapter X Part II
Assessments
LO 4.10.1: Understand the meaning of

assessment by Commissioner and
power of Commissioner to conduct
audit
11
Chapter X Part III Appeals
LO 4.11.1: List the appellate bodies

LO 4.11.2: Explain using simple
examples the circumstances when
appeal to the Commissioner (Appeals)
is made and the pre-conditions
applicable
LO 4.11.3: Explain the provisions
relating to decision of appeals by
Commissioner (Appeals) using simple
examples
relating to records to be kept by the
taxpayers
Chapter X Part VIII

Records, Information
Collection and Audit
(Section174 and 177)
13
The Income Tax Rules

related to the above
chapters of the Income Tax
Ordinance 2001 shall also
be examined
LO 4.13.1: Apply rules relevant to

learning outcomes specified against
each topic on well explained scenarios
14
First and Second Schedule

attached to the Income Tax
Ordinance 2001
LO 4.14.1: Apply clauses relevant to

learning outcomes specified against
each topic on well explained scenario
12

relating to audit by Commissioner
58
ix
Syllabus
Ref
Contents
Level
Learning Outcome
Sales Tax
Sales Tax Act 1990
1
(concepts of terms defined
Section 2 sub-sections 3,
5AA, 9, 11, 14, 16, 17, 20,
21, 22A, 25, 27, 28, 29A, 33,
35, 39, 40, 41, 43, 44, 46)
LO 5.1.1: Describe the definitions given

in section 2 sub-section 3, 5AA, 9, 11,
14, 16, 17, 20, 21, 22A, 25, 27, 28,
29A, 33, 35, 39, 40, 41, 43, 44, 46
LO 5.1.2: Describe other definitions
covered under relevant sections
LO 5.1.3: Apply definitions on simple
scenarios
Chapter II Scope and

payment of tax
LO 5.2.1: Understand the application

sales tax law on taxable supplies
including zero rated and exempt
supplies
LO 5.2.2: State the determination, time
and manner of sales tax liability and
payment using simple examples
Chapter III Registration
LO 5.3.1: State the requirement and

procedure of registration
Chapter IV Book keeping

and invoicing requirements
LO 5.4.1: List the record to be kept by a

registered person
LO 5.4.2: State the requirements of tax
invoice
LO 5.4.3: Explain the retention period
of record using simple examples.
LO 5.5.1: Understand the various types

of returns required to be filed by
registered and un-registered persons.
Chapter V Returns
Sales Tax Rules, 2006

1
Chapter I Registration,
Compulsory registration and
De-registration
LO 6.1.1: Explain the requirement and

procedure of registration, compulsory
registration and deregistration using
simple examples
Chapter II Filing of return

procedure of filing of return using
simple examples
59
Syllabus
Ref
Contents
Chapter III Credit and
Debit And Destruction of
Goods
Level
2
Learning Outcome
procedure of issuing debit and credit
notes using simple examples
LO 6.3.2: State the procedure for
destruction of goods
Chapter IV Apportionment
of Input Tax

procedure of apportionment of input tax
using simple examples
60
xi

Financial accounting and reporting II
Syllabus objectives
FINANCIAL ACCOUNTING AND REPORTING II
Objective
To broaden the knowledge base of basic accounting acquired in earlier modules with emphasis on
International Financial Reporting Standards.
Learning Outcome
1
prepare financial statements in accordance with the relevant law of the country and in
compliance with the reporting requirement of the international pronouncements.
account for transactions relating to tangible and intangible assets including transactions
relating to their common financing matters.
understand the implication of contingencies; changes in accounting policies and estimates;

errors and events occurring after reporting period.
account for simple transactions relating to taxation.
demonstrate knowledge of basic ethical issues in preparation and reporting of financial

information.
Grid
Weighting
Final Accounts
20
Consolidation of single subsidiary
15
Accounting for tangible and intangible assets, leases and borrowing cost
Provisions and contingencies; changes in accounting policies and estimates;
errors and events occurring after reporting period; and taxation
Ethics
Total
30
30
61
5
100
Contents
Level
Learning Outcome
Preparation of financial
statements Final accounts
statements of limited
companies in line with the
requirement of the Companies
Ordinance, 1984 and
International Financial
Reporting Standards (IAS 1
and 7 and others included in
the syllabus) excluding
liquidations reconstructions
and mergers

financial position in accordance with the
guidance in IAS 1 from data and information
provided
LO1.1.2: Identify the laws, regulations,
reporting standards and other requirements
applicable to statutory financial statements of a
limited company
LO1.1.3: Prepare and present the following in
accordance with the disclosure requirements of
IAS1, Companies ordinance, fourth schedule /
fifth schedule.
Statement of financial position

Statement of comprehensive income.
Statement of changes in equity
LO1.1.4: Prepare statement of cash flows in

accordance with the requirements of IAS 7.
statements Consolidation
of a single subsidiary
Elimination of investment in
subsidiary and parents equity
LO1.2.1: Describe the concept of a group as a

single economic unit.
LO1.2.2: Define using simple examples
subsidiary, parent and control
LO1.2.3: Describe situations when control is
presumed to exist.
LO1.2.4: Identify and describe the
circumstances in which an entity is required to
prepare and present consolidated financial
statements
LO1.2.5: Eliminate (by posting journal entries)
the carrying amount of the parents investment
in subsidiary against the parents portion of
equity of subsidiary and recognize the
difference between the two balances as either
goodwill; or
gain from bargain purchase
62
vi
Contents
Level
Learning Outcome
statements Consolidation
of a single subsidiary
(continued)
Identification of non-controlling
interest
LO1.3.1: Define and describe non- controlling

interest in the case of a partially owned
subsidiary.
LO1.3.2: Identify the non-controlling interest in
the following.
net assets of a consolidated subsidiary;

and
profit or loss of the consolidated
subsidiary for the reporting period
Profit and loss from intracompany transactions relating

to assets and inventories
without tax implications
LO1.4.1: Post adjusting entries to eliminate the

effects of intergroup sale of inventory and
depreciable assets.
Preparation of consolidated
statements of financial position
LO1.5.1: Prepare and present simple

consolidated statements of financial position
involving a single subsidiary in accordance
with IFRS 10.
Preparation of consolidated
statements of comprehensive
income
LO1.6.1: Prepare and present a simple

consolidated statement of comprehensive
income involving a single subsidiary in
accordance with IFRS 10.
63
Emile Woolf Publishing Limited
vii
Contents
Level
Learning Outcome
Accounting for tangible and

intangible assets, leases and
borrowing costs
Recognition, de-recognition,
measurement, depreciation /
amortization and measurement
after recognition of noncurrent assets (IAS 16 and IAS
38)
Leases (IAS 17)
LO2.1.1: Explain and apply the accounting

treatment of property, plant and equipment and
intangible assets.
LO2.1.2: Formulate accounting policies in
respect of property, plant and equipment and
intangible assets
LO2.2.1: Prepare and present extracts of
financial statements in respect of lessee
accounting, lessor accounting, and sale and
lease back arrangements.
respect of different lease transactions
LO2.2.3: Analyze the effect of different leasing
transactions on the presentation of financial
statements
Recognition of borrowing costs

(IAS 23)
LO2.3.1: Describe borrowing cost and

qualifying assets using examples.
LO2.3.2: Identify and account for borrowing
costs in accordance with international
pronouncements.
LO2.3.3: Report borrowing costs in final
accounts
respect of borrowing cost
64
viii
Contents
Level
Learning Outcome
Provisions and
contingencies; changes in
accounting policies and
estimates; errors and events
occurring after reporting
period; and taxation
Provisions, contingent liabilities
and contingent assets (IAS-37)
LO3.1.1: Define liability, provision, contingent

liability and contingent asset
LO3.1.2: Distinguish between provisions,
contingent liabilities or contingent assets.
LO3.1.3: Understand and apply the recognition
criteria for provisions IFRS.
LO3.1.4: Calculate/ measure provisions
LO3.1.5: Account for changes in provisions
LO3.1.6: Report provisions in final accounts
Accounting policies, changes

in accounting estimates; and
errors (IAS-8)
LO3.2.1: Define accounting policies,

accounting estimates and prior period errors.
LO3.2.2: Understand and analyze using
examples, IFRS guidance on accounting
policies, change in accounting policies and
disclosure.
examples, IFRS guidance on accounting
estimates, changes in accounting estimates
and disclosure.
examples, IFRS guidance on errors, correction
of errors and disclosure.
Events occurring after the

reporting period (IAS-10)
LO3.3.1: Explain using examples events after

the reporting period, adjusting events, and
non-adjusting events.
examples IFRS guidance on the recognition,
measurement and disclosure of adjusting
events and non-adjusting events.
examples, going concern issues arising after
the end of the reporting period.
65
Emile Woolf Publishing Limited
ix
Contents
Level
Learning Outcome
Accounting for taxation

Taxation: Current year, prior
years and deferred (IAS-12)
Note that the deferred

consequences of the following
transactions are not
examinable:
LO4.1.1: Define temporary differences and

identify temporary differences that cause
deferred tax liabilities and deferred tax assets
LO4.1.2: Determine amounts to be recognised
in respect of temporary differences
LO4.1.3: Prepare and present deferred tax
calculations using the balance sheet approach.
Business combination
(including goodwill
Assets carried at fair value
Un-used tax losses and
credits
Re-assessment of unrecognized deferred tax
assets
Investments in
subsidiaries, branches,
associates and interest in
joint venture
Items recognized outside
profit and loss account
Share based payment

respect of deferred tax
LO4.1.5: Apply disclosure requirements of
IAS12 to scenarios of a moderate level of
complexity
Ethics
An understanding of ethics
relating to preparation and
reporting of financial
information (Section 320 of
Code of Ethics for Chartered
Accountants)
LO5.1.1: Explain using simple examples the

ethical responsibilities of a chartered
accountant in preparation and reporting of
financial information
66

Cost and management accounting
S
Syllabus objectives

COST AND MANAGEMENT ACCOUNTING
Objective
To equip candidates with techniques of cost accounting to provide a knowledge base for
decision making skills..
Learning Outcome
1
understand the nature of cost accounting and analyse data in terms of cost
behaviour
establish the costs associated with the production of products and provision of
services
demonstrate an understanding of different costing system
apply the concepts of costing in the decision making process
demonstrate a functional knowledge of financial instruments
take account of the time value of money in making decisions
analyse the financial statements of a company using various ratios
Grid
Nature of cost accounting and elements of cost
Costing Systems and cost behavior
Decision making
Basics of financial management
Total
67
Weighting
10
40
35
15
100
Contents
Level
Learning Outcome
Nature of cost accounting

and cost behaviour
Meaning and scope of cost
accounting
LO1.1.1: Explain the scope of cost accounting and

managerial accounting and compare them with
financial accounting.
Analysis of fixed, variable

and semi variable expenses
LO1.2.1: Explain using examples the nature and

behaviour of costs.
LO1.2.2: Explain using examples fixed, variable,
and semi variable costs.
Direct and indirect cost
LO1.3.1: Describe direct and indirect cost.
Cost estimation using highlow points method and linear

regression analysis
LO1.4.1: Calculate estimated cost by using highlow points method.
Product cost and period cost
LO1.5.1: Explain using examples the terms product

cost and period cost.
LO2.1.1: Apply inventory valuation methods (

namely, FIFO, weighted average, lower of cost and
net realizable value) in simple scenarios
LO1.4.2: Apply regression analysis for cost

estimation.
Costs associated with

production
Basis of valuation - FIFO,
weighted average, lower of
cost and net realizable value
LO2.1.2: Comment on the suitability of inventory

valuation under FIFO, weighted average, lower of
cost and net realizable value
LO2.1.3: Compare inventory valuation under FIFO,
weighted average, lower of cost and net realizable
value
LO2.1.4: Calculate NRVs of inventories in a given
scenario
Economic Order Quantity
LO2.2.1: Describe the economic order quantity

(EOQ) and apply the concept in given scenarios.
LO2.2.2: Calculate the EOQ from data provided.
Safety stock
LO2.3.1: Describe safety stocks for inventories.

LO2.3.2: Explain the reasons for maintaining safety
stock.
LO2.3.3: Calculate the safety stock using data
provided.
68
vi
Contents
Level
Learning Outcome
Costs associated with

production (continued)
Re-order level
LO2.4.1: Explain re-order levels and the objectives

of setting re-order levels.
LO2.4.2: Calculate of re-order levels using data
provided.
Manufacturing expenses actual and applied
LO2.5.1: Describe manufacturing overheads using

examples.
LO2.5.2: Compare manufacturing, administrative
and selling costs.
LO2.5.3: Identify manufacturing overheads from
data provided.
LO2.5.4: Describe and distinguish actual overhead
and absorbed overhead.
LO2.5.5: Calculate absorbed overheads using data
provided.
Over or under absorbed

overhead
LO2.6.1: Compare actual and absorbed overheads

from data provided.
LO2.6.2: Analyze over or under absorption in terms
of expenditure and volume variances.
LO2.6.3: Account for over or under-absorbed
overheads.
Production and service

departments
LO2.7.1: Identify production and service

departments in a manufacturing facility and analyze
their related cost.
Apportionment, allocation
and absorption of service
departments' overheads to
production
LO2.8.1: Allocate direct and indirect costs to

production and service departments using
LO2.8.2: Allocate costs of service departments to
production department using data and information
provided.
Costing systems
Marginal costing
LO3.1.1: Explain the concept of marginal costing

and apply on given data.
LO3.1.2: Explain how it helps managerial decisions
using examples.
69
vii
Contents
Level
Learning Outcome
Costing systems
(continued)
Absorption costing
LO3.2.1: Describe absorption costing using

examples.
LO3.2.2: Compare marginal costing and absorption
costing.
Manufacturing cost
accounting cycle
LO3.3.1: Explain the flow of cost in production

process using examples.
LO3.3.2: Prepare accounting entries for flow of
cost.
Job order costing
LO3.4.1: Describe the job order costing.

LO3.4.2: Calculate cost of job and inventories by
application of job order costing.
LO3.4.3: Prepare accounting entries under the job
order costing system.
Process costing
LO3.5.1: Describe the process costing.

LO3.5.2: Calculate cost of product and inventories
by application of process costing.
LO3.5.3: Prepare accounting entries under the
process costing system.
Treatment of Joint and ByProducts
LO3.6.1: Describe joint and by product using

examples.
LO3.6.2: Allocate joint production costs using sales
value, physical unit, average unit and weighted
average methods.
LO3.6.3: Account for by-products using recognition
of gross revenue, recognition of net revenue and
replacement cost approaches.
Cost of services rendered
LO3.7.1: Explain how departmentalization in a

service organization help in cost planning and
control
LO3.7.2: Calculate cost of services rendered by a
service organization.
Standard costing
LO3.8.1: Explain standard costing using examples.

LO3.8.2: Perform standard setting for material,
labour and factory overhead.
Variance analysis-material,
labour and overhead
LO3.9.1: Calculate, analyze and interpret various

variances relating to material, labour and factory
overhead.
70
viii
Contents
Level
Learning Outcome
Costing systems
(continued)
Target costing
LO3.10.1: Describe target costing and how target

cost is determined.
LO3.10.2: Apply the target costing tools to given
scenarios.
Decision making
Opportunity cost
LO4.1.1: Describe opportunity cost using examples
Relevant cost
LO4.2.1: Describe relevant costs using examples

LO4.2.2: Identify the costs that are relevant to a
particular decision in given data.
Breakeven analysis
LO4.3.1: Explain the break-even point using

examples and margin of safety.
LO4.3.2: Calculate the breakeven point in quantity
and amount from information provided.
LO4.3.3: Apply cost volume profit (CVP) analysis
and explain its usefulness for management
Make or buy decisions
LO4.4.1: Apply marginal and relevant costing

concepts to analyze make or buy options
LO4.4.2: Analyze make or buy options in case of
capacity constraints.
LO4.4.3: Discuss using examples the importance
of qualitative consideration in make or buy
decisions.
Pricing for special orders
LO4.5.1: Perform incremental cost benefit analysis

for a special order
Further processing decisions
LO4.6.1: Perform incremental cost benefit analysis

for further processing costs
Utilization of spare capacity
LO4.7.1: Analyze the impact of spare capacity on

management decisions regarding make or buy,
special order and further processing
71
ix
Contents
Level
Learning Outcome
Financial instruments
(basic functions)
Shares, debentures, bonds,
futures, options, cap, floor,
collar, swaps, forward
LO5.1.1: Describe direct and indirect investment

using examples.
LO5.1.2: Describe using examples shares,
debentures, bonds, futures, options
LO5.1.3: Describe using simple examples the
following characteristics of indirect investments and
compare them with direct investments:
Divisibility
Liquidity
Holding period
LO5.1.4: Differentiate between investment and

speculation using simple examples.
LO5.1.5: Describe using simple examples cap,
floor, collar, swaps, forward
Time value of money
Computation of net present
value and internal rate of
return
LO6.1.1: Explain the time value of money

LO6.1.2: Calculate net present value and internal
rate of return of given cash flows
Financial analysis
Compute various ratios from
data and information
provided.
LO7.1.1: Following ratios:
Current ratio
Acid-test ratio/quick ratio
Gross profit
Return on equity
Return on assets
Return on capital employed
Debt-equity ratio
Inventory turnover
Debtor turnover
Creditor turnover
72

Audit and Assurance
Syllabus objective
AUDIT AND ASSURANCE
Objective
To acquire knowledge of theory, skill, techniques of auditing and to enable the students to
understand International Standards on Auditing, Assurance and Ethics.
Learning Outcomes
1
Demonstrate knowledge of general concepts governing an audit
Demonstrate working knowledge in respect of performance of simple audit

procedures and understand the audit report requirement under the Companies
Ordinance, 1984
Understand the requirement and application guidelines relating to some of the

specific areas of audit procedures including external confirmation, review of
subsequent event etc.
Comprehend nature of engagements of review of interim financial statements
Demonstrate familiarity with computer programming and IT controls relevant to

financial reporting
Respond on audit matters in the light of fundamental principles given in the Code
of Ethics
73
Audit and Assurance
Grid
Weighting
General concepts and principles of audit
20
Performance of audit and reporting
30
Specific areas
20
Computer programming and IT controls
15
Professional Ethics
15
Total
100
Syllabus
Ref
Contents
Level
Learning Outcome
General concepts and principles of audit

1
Introduction to International
Federation of Accountants
LO1.1.1: Briefly describe the

organizational overview encompassing
History;
Vision and mission
Introduction to international
auditing and assurance
standard setting body
LO1.2.1: Briefly describe the objectives

and functions of IAASB
Objective and general

principal governing an audit
(ISA 200)
LO1.3.1: Describe the overall

objectives of the independent auditor
LO1.3.2: Explain the nature and scope
of an audit designed to enable the
independent auditor to meet those
objectives
LO1.3.3: Outline the requirements
establishing the general responsibilities
of the independent auditor applicable in
all audits
Responsibility for the

financial statements
LO1.4.1: Understand the responsibility

of management and those charged with
governance for financial reporting and
related internal control on financial
reporting using simple examples
Auditors responsibility to
consider fraud (ISA 240)
LO1.5.1: Distinguish between the terms

error, fraud and misstatement
LO1.5.2: Compare the respective
responsibilities of management and
auditors for fraud
LO1.5.3: Describe the matters to be
considered and procedures to be
74
vi
Syllabus
Ref
Contents
Level
Learning Outcome
carried out to assist the auditor in
identifying, assessing and detecting the
risks of material misstatement due to
fraud
Legal consideration relating

to appointment and removal
of auditors (sections 252 to
260 of the Companies
Ordinance 1984)
Terms of Audit
engagements (ISA 210)
LO1.6.1: Explain how the first and

subsequent auditors are appointed
LO1.6.2: Explain how the first and
subsequent auditors are removed
LO1.6.3: Describe qualification and
disqualification of the auditor
LO1.7.1: Describe the preconditions
that are within the control of the entity
and upon which it is necessary for the
auditor and the entitys management to
agree
LO1.7.2: Respond if preconditions are
not present or limit is imposed on scope
of audit in well explained simple
situations
LO1.7.3: State the contents of an audit
engagement letter
Performance of audit and reporting

1
Planning an audit (ISA 300)
LO2.1.1: Identify the need for planning

an audit
LO2.1.2: State who should be involved
in planning and what preliminary
engagement activities are necessary
LO2.1.3: Discuss overall planning and
the audit plan for a recurring audit
LO2.1.4: Outline the additional
considerations that should be identified
while planning the initial audit
Assessment of audit risks

(ISA 315)
LO2.2.1: Outline the key steps involved

in identifying and assessing the risks of
material misstatement in the financial
statements, through understanding the
entity and its environment
LO2.2.2: Briefly state the components
of internal control
LO2.2.3: Differentiate between control
activities relevant and irrelevant to audit
75
vii
Audit and Assurance
Syllabus
Ref
Contents
Level
Learning Outcome
in a well explained scenario
Audit materiality (ISA 320)
LO2.3.1: Explain the concepts of

materiality and performance materiality
Audit evidence (ISA 500)
LO2.4.1: Explain, using examples,

sufficient appropriate audit evidence
LO2.4.2: State audit procedures to
obtain audit evidence
LO2.4.3: Explain what information can
be used as audit evidence using simple
examples
Audit sampling (ISA 530)
LO2.5.1: Explain audit sampling,

statistical sampling and sampling and
non-sampling risk using simple
examples
LO2.5.2: Explain what matters are
considered by auditors in respect of
sample design, size and selection of
items for testing using simple examples
Substantive procedures (ISA

330)
LO2.6.1: Explain the nature, extent and

timing of substantive procedures using
simple examples
Tests of controls (ISA 330)
LO2.7.1: Explain the nature, extent and

timing of test of controls using simple
examples
LO2.7.2: Explain how auditors evaluate
the operating effectiveness of controls
Analytical procedures (ISA

520)
LO2.8.1: Explain the nature and

purpose of substantive analytical
procedures using simple examples
LO2.8.2: State the purpose of analytical
procedures performed near the end of
the audit
Documentation (ISA 230)
LO2.9.1: Explain the nature and

purpose of audit documentation
LO2.9.2: Describe the form, content
and extent of audit documentation
76
viii
LO2.9.3: Understand the nature of

assembly of the final audit file
Syllabus
Ref
10
Contents
Understanding of audit
opinion and form of audit
report under the Companies
Ordinance 1984
Level
2
Learning Outcome
LO2.10.1: Briefly state the contents of
the auditors report
LO2.10.2: State the penalty for noncompliance with provisions related to
the audit report
Specific areas
1
External confirmations (ISA

505)
LO3.1.1: Describe the significance of

using external confirmation procedures
for obtaining relevant and reliable audit
evidence
LO3.1.2: Describe the steps involved in
external confirmation procedures
LO3.1.3: Differentiate between the
positive confirmation request and
negative confirmation request
Subsequent events (ISA

560)
LO3.2.1: Explain the meaning and

purpose of a subsequent events review
Written representation (ISA

580)
LO3.3.1: Discuss the nature of written

representations as audit evidence
LO3.3.2: Discuss the circumstances
where written representations are
necessary and the matters on which
representations are commonly obtained
Consideration of related
parties (ISA 550)
LO3.4.1: Describe the term related

party using simple examples
LO3.4.2: Discuss how related party
transactions can give rise to the risk of
material misstatement using simple
examples
LO3.4.3: Briefly describe the audit
procedures and related activities to
obtain information relevant to identifying
the risks of material misstatement
associated with related party
relationships and transactions
Using the work of

component auditors, internal
audits and auditors experts
(ISA 600, ISA 610 and ISA
620)
77
ix
LO3.5.1: Explain the responsibility of

the group engagement partner in
respect of acceptance and continuance,
overall audit strategy, understanding
the group, its component and their
Audit and Assurance
Syllabus
Ref
Contents
Level
Learning Outcome
environment, their auditor and
materiality
LO3.5.2: Explain the relationship
between the external auditor with
internal auditors and auditors experts
LO3.5.3: Discuss how external auditors
determine whether and to what extent
the use the work of internal audit
LO3.5.4: Discuss using examples how
external auditors uses the specific work
of internal audit
LO3.5.5: Discuss how the external
auditor uses the work of an auditors
expert when that work is used to assist
in obtaining sufficient appropriate audit
evidence
Review of interim financial

statements by the
independent auditor (ISRE
2410)
LO3.6.1: Explain the objective of a

review of interim financial statements
and how it differs from audit
LO3.6.2: State the terms of
engagement which may be included in
the engagement letter
LO3.6.3: Describe the procedures
generally adopted by the practitioner to
obtain evidence in review engagements
Computer programming and IT controls

1
Benefits and limitations of

flowcharts
LO4.1.1: State the benefits and

limitation of flowcharts using simple
examples
Types of flowcharts
LO4.2.1: Classify and distinguish

between types of flowcharts, namely,
linear, deployment and opportunity
flowcharts
LO4.2.2: Describe the macro, mini and
micro level details of flowcharts
Drawing flowcharts for

specific situations/programs
LO4.3.1: Draw different types of

flowcharts for given situations
Control design
LO4.4.1: Describe appropriate controls

while designing the system using
simple examples
General controls
LO4.5.1: Describe general controls and
78
x
Syllabus
Ref
Contents
Level
Learning Outcome
classify them into environment,
development, maintenance and
operational controls using simple
examples
Preventative, detective and

corrective controls
LO4.6.1: Describe preventative,

detective and corrective controls using
simple examples
Audit trails
LO4.7.1: Describe the concept of an

audit trail in a computerized
environment using simple examples
Logical access controls
LO4.8.1: Describe logical access

controls for a given situation/system
Physical access controls
LO4.9.1: Describe physical access

controls for a given situation/system
10
Program security techniques
LO4.10.1: Describe checks/controls

into the software system to protect data
from corruption and unauthorized
access
11
Data security and public

networks
LO4.11.1: State controls over data

transmission
LO4.11.2: Describe data encryption
techniques for transmission of data
over public networks
LO4.11.3: Describe communications
protocol
LO4.11.4: Understand the Open
System Interconnection (OSI) model
12
Monitoring and surveillance

techniques
LO4.12.1: Describe the usefulness of

system logs for analyzing a systems
performance

examples the fundamental principles of
professional ethics of integrity,
objectivity, professional competence
and due care, confidentiality and
professional behaviour
Professional ethics
1
Fundamental principles
(sections 100 to 150 of the
Code of Ethics for Chartered
Accountants)
79
xi
LO5.1.2: Apply the conceptual

framework to identify, evaluate and
address threats to compliance with
fundamental principles
Audit and Assurance
Syllabus
Ref
Contents
Level
Learning Outcome
LO5.1.3: Understand the threats and
circumstances that cause threats of
self-interest, self-review, advocacy,
familiarity, and intimidation
LO5.1.4: Discuss using simple
examples the safeguards to offset the
threats to compliance with the
fundamental principles
Client and engagement

acceptance (section 210 of
the Code of Ethics for
Chartered Accountants)
LO5.2.1: Explain using simple

examples the matters to be considered
and the procedures that an audit
firm/professional accountant should
carry out in the following
circumstances:
Client acceptance
Engagement acceptance
Changes in a professional
appointment
80
xii

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Syllabus Spring - 2015

(AFC-1) Functional English

(AFC-2) Business Communication

(AFC-3) Quantitative Methods

(AFC-4) Introduction to Information Technology

(CAF-1) Introduction to Accounting

(CAF-2) Introduction to Economics and Finance

(CAF-3) Business Law

(CAF-4) Business Management and Behavioural Studies

(CAF-5) Financial Accounting and Reporting I

(CAF-6) Principles of Taxation

(CAF-7) Financial Accounting and Reporting II

(CAF-8) Cost And Management Accounting

(CAF-9) Audit and Assurance

Assessment of Fundamental Competencies

use vocabulary correctly

construct sentences using correct grammar

write meaningful essays and prcis and comprehend written English

Practical use of Grammar

Composition and Comprehension (General)

Emile Woolf International

The Institute of Chartered Accountants of Pakistan

Meanings and application of

Practical use of Grammar

LO1.1.1: Use synonyms or antonyms

LO2.1.1: Understand and construct

Phrases and idioms

LO2.2.1: Construct meaningful

LO2.3.1: Understand and apply rules of

Direct and indirect speech

LO2.4.1: Change sentences from direct

Active and passive voice

LO2.5.1: Change of sentences from

LO3.1.1: Write essays on topics

LO3.2.1: Write meaningful and effective

Comprehension and speed

LO3.3.1: Comprehend a brief write up

The Institute of Chartered Accountants of Pakistan

Assessment of Fundamental Competencies

Comprehend concepts of business communication

Demonstrate awareness of listening skills concepts

Write simple business letters and short reports

Understand the utility of the internet with respect to business communication

Business messages and report writing

Communication via the internet

Emile Woolf International

The Institute of Chartered Accountants of Pakistan

LO1.1.1: Define business

LO1.2.1: Define communication

LO1.3.1: Describe with simple

Meaning, types and barriers

LO2.1.1: Explain why listening is

The Institute of Chartered Accountants of Pakistan

Syllabus and study guide

Business letters and

LO3.1.1: Classify the type of business

Persuasive letters and

LO3.2.1: Explain the salient features of

Short business reports

LO3.3.1: State the meaning and

Communication via the

Website hosting (types and

LO4.1.1: State meaning, types and

Features, benefits and