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Theory For Cma Final CFR
Theory For Cma Final CFR
(ii) a non-banking institution which is a company and which has as its principal
business the receiving of deposits, under any scheme or arrangement or in any
other manner, or lending in any manner;
(iii) such other non-banking institution or class of such institutions, as the Bank may,
with the previous approval of the Central Government and by notification in the
Official Gazette, specify.
However, such a company but does not include any institution whose principal
business is that of:
agriculture activity,
industrial activity,
purchase or sale of any goods (other than securities), or providing any services, and
sale/ purchase/ construction of immovable property
Doubtful Assets
A term loan or Lease asset or a hire purchase which remains sub-standard asset for a period
exceeding 18 months
Loss Assets
Asset which has been identified as loss asset by NBFC or its internal or external auditor or
by RBI
Asset which is adversely affected by a potential threat of non recoverability due to either
erosion in the value of security or non availability of security or due to any fraudulent act
or omission on the part of the borrower.
Unquoted equity shares – Cost or break up value As per RBI directions, Fair
Current investments which ever is lower value can also be used
instead of break up value
Unquoted Preference Cost or Face value
shares whichever is lower
CMA FINAL FR
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BENEFITS
INTERNAL BENEFITS EXTERNAL BENEFITS
Enhanced link between financial and non Improving reputation and brand loyalty
financial performance
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CSR REPORTING
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CSR IN INDIA
Governed by Sec 135 of Companies Act 2013 and CSR Rules 2014
Applicability - Companies
Net worth of Rs. 500 crores or more or
Turnover of Rs. 1000 crores or more or
Net Profit of Rs. 5 crores or more
during any financial year shall be required to constitute a CSR committee of the Board.
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CSR REQUIREMENTS
Committee shall comprise of 3 or more directors out of which atleast one director
shall be an independent director.
Such companies shall spend, in every financial year, atleast 2 % of the average net
profits of the company during the three immediately preceding financial years
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CMA FINAL FR
Brief outline of the CSR policy including overview of projects or programs proposed to be undertaken
Average net profit of the company for last three financial years
Prescribed CSR expenditure ( 2 % of the amount of net profit for last 3 FY)
Reasons for not spending the 2 % of the amount of net profit for last 3 FY
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VALUE CREATION AND SIX CAPITALS
Social Capital – Networks together with shared norms, values and understandings to
facilitate cooperation within or among groups
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BENEFITS OF IR
Incorporates Sustainability into its core business
Communicate the impact of company’s operations on environment and community
Competitive edge over its peers in the long term
Informed decisions and improved overall performance
Identify cost savings
Increase internal collaboration
Increase engagement with internal and external stakeholders through consistent and
balanced reporting
Address reputational risk
Increase brand value and customer loyalty
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TRIPLE BOTTOM LINE
REPORTING
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CONCEPT OF TBLR
Expands the traditional reporting framework to take into account social and
environmental performance in addition to financial performance
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BENEFITS OF TBLR
Enhancement of Reputation and Brand
Securing a social license to operate
Attraction and retention of high calibre employees
Improved access to investor market
Establish position as a preferred supplier
Reduced risk profile
Identification of potential cost savings
Increased scope for innovation
Aligning stakeholder needs with management focus
Creation of sound basis for stakeholder dialogue
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USERS OF TBLR
Businesses – Unilever, General Electric, P & G
Non profit Organizations
Government – decision making and performance monitoring tools
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IMPLEMENTATION OF TBLR
Senior Management endorsement and commitment
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FR V TBLR
Origin – FR precedes TBLR
Nature – FR is mandatory for corporates. TBLR is voluntary
Scope – TBLR is broader in scope than FR.
Contents – Information contained in TBLR is of a different nature to that of FR
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BUSINESS RESPONSIBILITY
REPORTING
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REGULATORY REQUIREMENTS OF BRR
MCA in July 2011 – National Voluntary Guidelines on Social Environmental and
Economic Responsibilities of Business.
As per regulation 34 (2) (f) of the listing regulations issued by SEBI, the annual report
shall contain a business responsibility report describing the initiatives taken by listed
entity from the environmental, social and governance perspective in the format as
specified by the Board
Those listed entities which have been submitting sustainability reports to overseas
regulatory agencies/stakeholders based on internationally accepted reporting
frameworks need not prepare a separate report for the purpose of these guidelines
but only furnish the same to their stakeholders along with a mapping of the principles
contained in these guidelines to the disclosures made in their sustainability reports.
CMA FINAL FR
FORMAT FOR BRR
Section A – General Information about the company
Section B – Financial Details of the Company
Paid up capital
Total Turnover
Total Profit after Taxes
Total spending on CSR as a % of PAT
List of Activities in which expenditure has been incurred
Section C – Other details
Does the company have any subsidiary company
Do Subsidiary company participate in BR initiatives of the parent company
Do suppliers, distributors participate in BR initiatives of the parent company
Section D – Other Information – Director details who are responsible for BR
Section E - Principle and Performance
CMA FINAL FR
NINE PRINCIPLES
Businesses should conduct and govern themselves with Ethics, Transparency and
Accountability
Businesses should provide goods and services that are safe and contribute to
sustainability throughout their life cycle
Businesses should promote the wellbeing of all employees
Businesses should respect the interests of and be responsive towards all stakeholders,
especially those who are disadvantageous, vulnerable and marginalized.
Businesses should respect and promote human rights
Businesses should respect, protect and make efforts to restore the Environment
Businesses when engaged in influencing public and regulatory policy should do so in a
responsible manner
Businesses should support inclusive growth and equitable development
Businesses should engage with and provide value to their customers and consumers in
a responsible manner
CMA FINAL FR
XBRL REPORTING
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CONCEPT OF XBRL (EXTENSIBLE BUSINESS
REPORTING LANGUAGE
Extensible: User can extend the application of a particular business data beyond
its original intended purpose
Business : Platform is relevant to any type of business transaction. Describes the
financial statements for all kinds of entities
Reporting : In a consolidated manner using the specified formats
Language : XML (Extensible Markup Language) which facilitates standard means of
communicating information between businesses and on the internet
Definition : As per Companies (filing of documents and forms in XBRL) Rules 2015,
XBRL means a standardized language for communication in electronic form to
express report or file financial information by the companies under the
Companies Act 2013.
CMA FINAL FR
IMPORTANT XBRL RELATED CONCEPTS
XML
TAXONOMY
Means an electronic dictionary for reporting the business data as approved by the
Central Government in respect of any documents or forms indicated in these rules.
Different taxonomies will be required for different reporting purposes
Recognized Taxonomies are as follows
India Banking GAAP Taxonomy2014
BRAZIl GAAP Commercial and IndustrialTaxonomy
Indonesia Stock Exchange Taxonomy2014
Japan EDNET Taxonomy 2010.
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MYTHS REGARIDNG XBRL
XBRL is not a set of Accounting Standards
CMA FINAL FR
FEATURES OF XBRL REPORTING
Clear Definition
CMA FINAL FR
BENEFITS OF XBRL REPORTING
Automated Data Processing
Data Review
Interchangeable
Tagging of transactions
CMA FINAL FR
USERS OF XBRL
Companies
Not for Profit Organizations
Accountants
Analysts
Investors
Regulatory Authorities
Financial Regulators
Security regulators and stock exchange
Business registrars
Government agencies
Tax Authorities
Statistical and monetary policy authorities
Specialist Data Providers
CMA FINAL FR
XBRL IN INDIA
MCA, RBI, SEBI, BSE
CMA FINAL FR
GOVERNMENT ACCOUNTING
(For Detailed Discussion Use separate material given)
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FEATURES OF GOVERNMENT ACCOUNTING
SPECIFIC SYSTEM OF ACCOUNTING
GOVERNMENT REGULATIONS
BUDGET HEADS
BUDGETARY REGULATION
MODE OF TRANSACTION
AUDITING
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OBJECTIVES OF GOVERNMENT ACCOUNTING
RECORD FINANCIAL TRANSACTIONS OF REVENUE AND EXPENDITURE RELATING TO
GOVERNMENT ORGANISATIONS
PROVIDE RELIABLE FINANCIAL DATA AND INFO ABOUT OPERATIONS OF PUBLICFUND
RECORD EXPENDITURE AS PER APPROPRIATE ACT, RULES AND LEGAL PROVISIONS
SET BY GOVERNMENT.
AVOID EXCESS EXPENDITURES BEYOND THE LIMIT OF BUDGET APPROVED BY
GOVERRNMENT.
HELP IN PREPARATION OF VARIOUS FINANCIAL STATEMENTS AND REPORTS
FACILITATE AUDITING BY CONCERNED GOVERNMENT DEPARTMENT
PREVENT MISAPPROPRIATION OF GOVERNMENT PROPERTIES
FACILITATE ESTIMATING THE ANNUAL BUDGET BY PROVIDING HISTORICAL
FINANCIAL DATE OF GOVERNMENT AND EXPENDITURES
CMA FINAL FR
GENERAL PRINCIPLES OF GOVT ACCOUNTING
CLASSIFICATION OF EXPENDITURES
BASED ON BUDGET
PERIOD OF ACCOUNTS
FORM OF ACCOUNTS
CMA FINAL FR
GOVT ACCOUNTING vs COMMERCIALACCOUNTING
BASIS GOVERNMENT ACCOUNTING COMMERCIAL ACCOUNTING
Meaning Applied in Govt departments Applied in Non Govt departments
and offices and offices ( profit or non profit )
Objective To record and report the To know the profit or loss and
utilization and position of disclose the financial position
public funds
CMA FINAL FR
GOVT ACCOUNTING vs COMMERCIALACCOUNTING
BASIS GOVERNMENT ACCOUNTING COMMERCIAL ACCOUNTING
Rules and Financial rules and provisions Rules as per GAAP
Provisions as set by government
Information Reporting to Govt Reporting to various stakeholders
Auditing Recognised department of Chartered Accountant
Government (Auditor General
Office)
CMA FINAL FR
ROLE OF CONTROLLER GENERAL OF ACCOUNTS
APEX ACCOUNTING BODY
RESPONSIBLE FOR ESTABLISHING AND MAINTAINING A TECHNICALLY SOUND
MANAGEMENT ACCOUNTING SYSTEM
CONSOLIDATING MONTHLY ACCOUNTS OF GOVERNMENT OF INDIA AND REPORTING
ON FISCAL DEFICIT
MONTHLY REVIEW INDICATING FLOW OF EXPENDITURES, REVENUE COLLECTION,
INTERNAL AND EXTERNAL BORROWING AND FISCAL DEFICIT IS PREPARED FOR
MINISTRY OF FINANCE
SUMMARY OF MONTHLY ACCOUNTS IS PLACED ON THE INTERNET
PREPARES ANNUAL APPROPRIATION ACCOUNTS AND UNION FINANCE ACCOUNTS FOR
PRESENTATION FOR THE PARLIAMENT
PROVIDE ADVICE TO MINISTRIES AND DEPARTMENTS ON ACCOUNTING PROCEDURES
FOR NEW SCHEMES AND PROGRAMMES
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ACCOUNTS OF GOVERNMENT
CONSOLIDATED FUNDS OF INDIA
Constituted under Article 266(1) of the Constitution of India
Largest of the Funds
Credited with All Revenues ( like Taxes, GST , Customs duty etc)
Credited with Internal and External Debts
Debited with Expenditures
No amount can be withdrawn from the fund without authorization from the Parliament
PUBLIC ACCOUNTS OF INDIA
Constituted under Article 266 (2) of the Constitution of India
Debts other than those recorded in the Consolidated Funds of India
Transactions under Debts, Deposits and Advances in this part are those in respect of which
Government incurs a liability to repay the money received or has a claim to recover the
amounts paid
Parliament authorization for payments from the public account is not required
CMA FINAL FR
ACCOUNTS OF GOVERNMENT
CONTINGENCY FUNDS OF INDIA
Constituted under Article 267 of the Constitution of India
It records the transactions connected with Contingency
It is held on behalf of President by the Secretary to the Government of India, Ministry of
Finance, Department of Economic affairs
Corpus of the fund is Rs. 500 crores
Advances from the fund are made for the purpose of meeting unforeseen expenditure
which are resumed to the fund to the full extent as soon as Parliament authorizes
additional expenditure
More like Imprest account of Government of India
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ROLE OF C & AG (COMPTROLLER AND AUDITOR
GENERAL
TO COMPILE ACCOUNTS OF UNION AND STATES
TO PREPARE AND SUBMIT ACCOUNTS TO THE PRESIDENT, GOVERNORS OF STATES
AND ADMINISTRATORS OF UNION TERRITORIES HAVING LEGISLATIVE ASSEMBLIES
PROVIDE INFORMATION AND RENDER ASSISTANCE TO THE UNION AND STATES
TO AUDIT ALL EXPENDITURES FROM THE CONSOLIDATED FUND OF INDIA AND OF
EACH STATE AND EACH UNION TERRITORY HAVING A LEGISLATIVE ASSEMBLY
TO AUDIT TRANSACTIONS OF UNION AND STATES RELATING TO CONTINGENCY
FUDNS AND PUBLIC FUNDS
TO AUDIT ALL TRADING, MANUFACTURING, PROFIT AND LOSS ACCOUNTS AND
BALANCE SHEETS AND OTHER SUBSIDIARY ACCOUNTS KEPT IN ANY DEPARTMENT
OF THE UNION OR STATE
AUDIT OF RECEIPT AND EXPENDITURES OF BODIES OR AUTHORITIES
SUBSTANTIALLY FINANCED FROM UNION OR STATE REVENUES
CMA FINAL FR
ROLE OF C & AG (COMPTROLLER AND AUDITOR
GENERAL
AUDIT OF RECEIPTS OF UNION OR STATES
CMA FINAL FR
POWER OF C & AG – AUDIT OFACCOUNTS
CMA FINAL FR
PUBLIC ACCOUNTS COMMITTEE & ITS ROLE
CMA FINAL FR
PUBLIC ACCOUNTS COMMITTEE & ITS ROLE
CMA FINAL FR
INDIAN GOVT ACCOUNTING STANDARDS - IGAS
ACCOUNTING NAME
STARDARD
IGAS 1 GUARANTEES GIVEN BY GOVERNMENT
IGAS 2 ACCOUNTING AND CLASSIFICATION OF GRANTS IN AID
IGAS 3 LOANS AND ADVANCES MADE BY GOVERNMENT
IGAS 7 FOREIGN CURRENCY TRANSACTIONS AND LOSS / GAIN
BY EXCHANGE RATE VARIATION
IGAS 9 GOVERNMENT INVESTMENTS IN EQUITY
IGAS 10 PUBLIC DEBT AND OTHER LIABILITIES OF GOVERNMENTS
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INDIAN GOVT FINANCIAL REPORTING STANDARDS
(IGFRS)
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