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Everything you need to know while preparing for CA Intermediate Paper 1: Accounting

In this article, we are sharing the tips & tricks on Preparing for CA Intermediate Paper 1: Accounting.

What is the structure of the paper?

The Accounts paper of CA Intermediate has both conceptual and practical aspects to it where the theory or conceptual questions mainly relate to Accounting Standards.

You are required to attempt 5 out of 6 questions of 20 marks each.

  1. Generally, the first question, which is to be compulsorily attempted, consists of 4 questions of 5 marks each on Accounting Standards.
  2. Question No. 2 to 5 usually comprises 2 questions of 10 marks each which are elaborate practical questions.
  3. Question No. 6 once again includes a break up of 4 questions of 5 marks each, containing a mix of Accounting Standards and smaller practical questions.

Please Note: This is the trend that has been observed over the years. However, ICAI may change its paper pattern and question break-up any time.

What are the examiner’s expectations?

  1. Emphasis will be laid on conceptual clarity and understanding of each AS. The examiner will assess the ability of the student to comprehend the question, relate the relevant AS and exercise of good judgement.
  2. Presentation of the answers (appropriate formats and working notes) will be given importance.
  3. The assumptions made are reasonable and in line with ICAI.

What should be the source of content?

  1. Content provided by your Coaching Provider along with your personal summary notes can be used as a base. However, ensure that it is comprehensive in its coverage by cross checking it with ICAI material
  2. Past Examination Papers, RTPs and MTPs.
  3. Referencer developed by ICAI for a summarised version of the notes.

Pro Tip: Stick to your base material as a reference. You must avoid changing the source of content closer to examination since that may lead to confusion in your study preparation.

What is the ideal learning methodology & time to be invested?

Reading Source Time Expected Outcome
1st A detailed study of every concept involved 6 to 7 days ● Eliminate the easy questions and prepare a repository of questions.

● Prepare notes with short explanations or graphic charts for every AS. Read as many different types of questions as you can pertaining to each AS.

● Highlight the important and tricky adjustments so that you can just go through them whenever you revise instead of practicing the entire solution.

● Do not attempt to solve every sum – just ensure you know the flow of the answer and make a quick reference list of the important points you must remember about every chapter.

● If time permits, solve the MCQs in the ICAI module for conceptual clarity.
2nd A summarised version of the syllabus 3 to 4 days ● Cut down the list of questions to be practised in this revision.

● Keep reading the notes you have prepared for the AS and the practical chapters.
3rd A quick revision to cut-down pre-exam study time 1 to 1.5 day ● Go through all your summarised notes and appear for a mock exam.
4th The final revision one-day before the exam 1 to 1.5 day ● Trust your past preparations and instincts.

● Read through all the summarised notes prepared by you.

● Go through all important adjustments and earmarked sums.

Pro Tip: Ensure that you practice 1-2 questions of each concept, practical or theoretical, in writing to enhance your conceptual clarity and to learn how to present the answers appropriately

What is the appropriate order in which the syllabus should be studied?

The overall portion can be mainly divided into 2 parts: Accounting Standards and other Practical Chapters.

Despite the lengthy syllabus, avoid ad-hoc selective studies; follow a method of smart studying and be thoroughly clear with all the concepts.

Visit the concept of ‘Remember, Revise, Recollect’ all throughout your study preparation.

  • Accounting Standards

Accounting Standards have a minimum 20% to upto 40% weightage in the exams, thus constituting a very important portion of the syllabus.

Type of Questions Accounting Standards
Theoretical questions AS 1: Disclosure of Accounting Policies
Practical Questions AS 2: Valuation of Inventories
AS 3: Cash Flow Statement
Theoretical + Practical Questions AS 10: Property, Plant and Equipment
AS 11: The Effects of Changes in Foreign Exchange Rates
AS 12: Accounting for Government Grants
AS 13: Accounting for Investments
AS 16: Borrowing Costs

Study each accounting standard based on the type of questions that are more frequently asked from them.

  • Practical-oriented Chapters

ICAI generally covers all of the chapters in the question paper and hence all have almost equal weightage.

Nevertheless, some trends and observations from the past year examination papers are as under:

1. Investment Accounts

2. Insurance Claims

3. Hire Purchase Transactions

4. Departmental Accounts

5. Branch Accounts

6. Single Entry

10 mark practical questions from each

Names of Chapters Type and Weightage of Questions asked
1. Accounting for Bonus and Rights Issue

2. Redemption of Preference Shares

3. Redemption of Debentures

 Single consolidated question from all chapters of 10-15 marks
Preparation of Financial Statements of Companies a. 5 mark questions on topics like Managerial Remuneration, Effective Capital, Divisible Profits, etc.

b. An elaborate question to prepare either a Balance Sheet or a Statement of Profit and Loss may appear for 10 marks.

c. A very elaborate question to prepare both Balance Sheet and a Statement of Profit and Loss of 16 to 20 marks. (not very frequently asked)
1. Cash Flow Statement

2. Profit or Loss Pre and Post Incorporation

 Either 5 or 10 mark question, the number of adjustments varying with the marks.
1. Introduction to Accounting Standards

2. Theory from practical chapters

 5 marks
Framework for Preparation and Presentation of Financial Statements 5 marks (frequently asked)

The above table proves that all chapters are equally important.

Disclaimer: The above analysis is based on examination papers of the last 3-4 years. The trend may change from time to time at discretion of ICAI

Note: Learn about the weightage distribution over various topics as per ICAI

How can I ace my exam writing skills?

Accounting papers are known to be lengthy – The best way through it is to know a rough format of your answers in advance by practicing a few answers of each chapter in writing.

  1. Use the 15 minutes reading time judiciously to strategize your way through the paper.
  2. It is very important to choose the right order for attempting the paper – ensure that you manage to attempt 40 marks in the first 1-1.25 hours.
  3. In case you cannot figure out the solution to a particular question within a designated time, make sure you move ahead to the next question.
  4. Present the answers to the questions on AS in the following manner:
    1. AS Number and Title
    2. Provision or AS along with a formula (if any)
    3. Facts of the case
    4. Comments and recommendations
    5. Conclusion
  5. Ensure that you bullet your answers and underline the key words, wherever relevant.
  6. Ensure that all formats are properly made with headings and rupee symbol clearly written.

Pro Tip: Start writing your exam with the question you are most comfortable with – it will help to boost your confidence for the paper.

How to prepare on the eve of the exam?

We recommend that you start your Accounts preparation 3 – 4 days before your exam date depending on your comfort and preparation. This will help you cover the syllabus in detail and will also leave some space to deal with pre-exam nerves.

Topics to be Covered Time Allotted in Hours
Accounting Standards

● Go through the summarised notes explaining the standard.

● Read important questions identified from study material and other sources.

● Study the introduction chapter if time permits.

 12 – 16
Financial Statements of Companies 4 – 6
Cash Flow Statement 2 – 4
Insurance Claims 2 – 4
Departmental Accounts 4 – 6
Branch Accounting 4 – 6
Hire Purchase Accounts 2 – 4
Investment Accounts 2 – 4
Single Entry 2 – 4
Profit or Loss Pre and Post Incorporation 2 – 4
Redemption of Preference Shares 2 – 4
Redemption of Debentures 2 – 4
Accounting for Bonus Issue and Right Issue 1 – 2
 

Framework for Preparation and Presentation of Financial Statements

 1 – 2

Pro Tip: This is just a suggested order based on level of difficulty, from more difficult to relatively easy.

What are the major challenges faced by students while attempting the Exam on the D Day & how must I prepare in advance to meet those challenges?

Challenges Solutions
Inability to logically think and present an answer to a new question ● Solve a couple of questions in writing in every revision.

● Focus on the format of the various answers as per ICAI.

● Know when to elaborate through working notes to improve understand-ability.
Recollecting and associating questions to the related topics Appear for mock exams in a time bound format so that you can get an idea of how to deal with all the topics together
Scoring well in the theory based questions Use the right vocabulary – stick to the keywords used by ICAI
Inability to manage time in the paper Unnecessary time should not be devoted on a particular question. In case you cannot figure out the solution to a particular question, designate some time to it at the end of the paper

For additional resources to assist you while preparing for CA Intermediate, visit here.

Good Luck!

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