UPSC : Commerce and Accountancy : Optional Subject of Main Examination

Accounting & Finance

Part - I: Accounting, Taxation & Auditing

Financial Accounting

Accounting as a financial information system; Impact of behavioural science. Accounting Standards e.g., accounting for depreciation, inventories, gratuity, research and development costs, long term construction contracts, revenue recognition, fixed assets, contingencies, foreign exchange transactions, investments and government grants.

Advanced problems of company accounts. Amalgamation absorption and reconstruction of companies. Valuation of shares and goodwill.

Cost Accounting
Nature and functions of cost accounting.
Job Costing.
Process Costing.
Marginal Costing; Techniques of segregating semi-variable costs into fixed and variable costs.
Cost-volume-profit relationship; aid to decision making including pricing decisions, shutdown etc.
Techniques of cost control and cost reduction.
Budgetary control, flexible budgets.
Standard costing and variance analysis.
Responsibility accounting, investment, profit and cost centres.

Taxation
Definitions
Basis of charge.
Incomes which do not form part of total income.
Simple problems of computation of income under various heads, i.e., salaries, income from house property, profits and gains from business or profession, capital gains, income of other persons included in assessees total income.
Aggregation of income and set off/carry forward of loss.
Deductions to be rhade in computing total income.

Auditing
Audit of cash transactions, expenses, incomes, purchases, sales.
Valuation and verification of assets with special reference to fixed assets, stocks and debts.
Verification of liabilities.
Audit of limited companies; appointment, removal, powers, duties and liabilities of company auditor, significance of true and fare, MAOCARO report.
Auditors report and qualifications therein. Special points in the audit of different organisations like clubs, hospitals, colleges, charitable societies.

Part - II: Business Finance and Financial Institutions
Finance Function - Nature, Scope and Objectives of Financial Management -Risk and Return relationship.
Financial Analysis as a Diagnostic Tool.

Management of Working Capital and its Components - Forecasting working capital needs, inventory, debtors cash and credit management.

Investment Decisions - Nature and Scope of Capital Budgeting - Various types of decisions including Make or Buy and Lease or Buy - Techniques of Appraisal and their application-Consideration of Risk and Uncertainty - Analysis of Non-financial Aspects.

Rate of Return on Investments - Required Rate of Return - its measurement - Cost of Capital - Weighted Average Cost - Different Weights.

Concepts of Valuation - Valuation of firms Fixed Income Securities and Common Stocks.

Dividend and Retention Policy - Residual Theory or Dividend Policy - Other Models - Actual Practices.

Capital Structure - Leverages - Significance of Leverages - Theories of Capital Structure with special reference to Modighani and Miller approach. Planning the Capital Structure of a Cojmpany; EBIT-EPS Analysis, Cash-flow ability to service debt, Capital Structure Ratios, other methods.

Raising finance - Short term and long term. Bank finance - norm* and conditions.

Financial Distress - Approaching BIFR under Sick Industrial Undertakings Act: Concept of Sickness, Potential Sickness, Cash Loss, Erosion of Networth.

Money Markets - The purpose of Money Markets, Money Market in India -Organization and working of Capital markets in India - Organization, Structure and Role of Financial Institutions in India. Banks and Investing Institutions - National and International Financial Institutions - their norms and types,of financial assistance provided - Inter-bank Lending-its regulation, supervision and control. System of Consortium - Supervision and regulation of banks.
Monetary and Credit policy of Reserve Bank of India.

Organisation Theory and Industrial Relations

Part-I: Organisation Theory
Nature and concept of Organisation - Organisation goals; Primary and secondary goals, Single and multiple goals, ends means chain-Displacement, succession, expansion and multiplication of goals - Formal organisation; Type, Structure - Line and Staff, functional matrix, and project - Informal organisation - functions and limitations.

Evolution of organisation theory: Classical, Neo-classical and system approach- Bureaucracy; Nature and basis of power, sources of power, power structure and politics - Organisational behaviour as a dynamic system: technical, social and power systems - interrelations and interactions - Perception-Status system. Theoretical and empirical foundation of theories and Models of motivation. Morale and productivity - Leadership: Theories and styles -Management of conflicts in organisation - Transactional Analysis - Significance of culture to organisations. Limits of rationality - Organisational change, adaptation, growth and development, Professional management Vs. family management, Organisational control and effectiveness.

Part-II: Industrial Relations.

Nature and scope of industrial relations, the socio-economic set-up, need for positive approach.
Industrial labour in India and its commitment - stages of commitments. Migratory nature - merits and shortcomings.
Theories of Unionism.

Trade Union movement in India - origin, growth and structure; Attitude and approach of management in India - recognition. Problems before Indian Trade Union movement.

Industrial disputes - sources; strikes and lockouts.
Compulsory adjudication and collective bargaining - approaches.
Workers participation in management - philosophy, rationale; present day state of affairs and future prospects.
Prevention and settlement of industrial disputes in India.
Industrial relations in Public Enterprises.
Absenteeism and labour turnover in Indian Industries - causes.
Relative wages and wage differentials; wage policy.
Wage policy in India; the Bonus issue.
I.L.O. and India;
Role of Personnel Department in the Organisation.