New Syllabus – Paper 1
(First Impression – Part I)


Anything new always creates curiosity, and so did the announcement of ICAI to introduce a change in the Chartered Accountancy curriculum do. The study plans of students have come to a standstill till the syllabus is released. A lot of queries regarding the content, complexity of the new syllabus, approach required to have mastered the subject, advantage of new topics in practical work, etc. have been bothering the students. And nothing could be answered precisely till the institute made its expectations clear by publishing the study material.
As the institute has published some topics of the curriculum at CA Final level, it is now possible to have an insight of the degree of proficiency expected and also it is the time for students to satisfy their curiosity!
Stay tuned to Ind AS Lab to find an answer to every query you have as a CA Final student!

Are there any significant changes in the syllabus as compared to the old FR syllabus?

New syllabus primarily focusses on Indian Accounting Standards. Apart from this, some previous GAAP are continued in new syllabus. However, we believe that weight over previous GAAP may not be more than 8-12 marks. Hence, students should primarily hone their skills in the subject of Ind AS. Students can find relief on the elimination of financial reporting for financial institutions.

What are the new topics introduced in the new syllabus?

There are few new accounting standards such as accounting for agriculture, insurance, exploration and evaluation of minerals, non-current assets held for sale, investment properties, regulatory deferral accounts, and business combinations under the acquisition method. Students must also sharpen their skills in the field of financial instruments especially considering new classification model and hedge accounting.

What is the level of complexity of the new FR syllabus?

Before syllabus was out, we were expecting complexity at an expert level that is usually required from professionals while implementing Ind AS in industry. However, ICAI is kind enough to maintain above average complexity. Students with right kind of mentor and guide shall be able to sail through CA final exam. Thus, students must understand that it is less about the complexity of the subject and more about the simplicity offered by your tutor.

What is the level of understanding expected by ICAI concerning Ind AS?

We believe that ICAI ‘ve been waiting for you to be ready to be accepted in an industry that is already Ind AS compliant. ICAI has ensured that once you complete your CA course and join any listed company, you will be able to easily cope up with new accounting framework that is present in the enterprise. Thus, ICAI Paper 1 syllabus is a perfect step to transform yourself from an accounting student to accounting professional.

Is a student expected to know all the AS as well as Ind AS?

Of course. You are supposed to know all AS as well as Ind AS. We interpret this requirement as new syllabus has covered all AS and Ind AS at IPCC and CA Final level respectively. Additionally, you cannot be celebrated as Chartered Accountant unless you have studied all the accounting standards at least once. If not ICAI, we at Ind AS Lab have very high expectation from any student who will be completing CA course and joining the industry.

How relevant is the new syllabus in practical work as a CA professional?

In a changing landscape of regulatory framework, newly qualified CAs will have equal say irrespective of their inexperience. This fact can be achieved only through technical core competency. ICAI new syllabus Paper 1 and 6E correctly takes care to imbibe fundamental accounting knowledge into you. This fact actually empowers you to go out in the market and get your worth as soon as you complete CA. Please note that ICAI has introduced Ind AS, IFRS and US GAAP in its syllabus that should be sufficient to you to work as an accountant anywhere in the globe. You are just a few months away from your dream job.

Is there any change in the ICAI modules? If so, is it helpful to the students?

ICAI modules have substantially face changed. We can see more student friendly colourful material. Though the quality of the material is better than the previous version of ICAI modules, we at Ind AS Lab believe that these modules were created in haste to roll out the new syllabus. We honestly believe that the material of ICAI is a creation of decentralised effort of many contributors that may not necessarily create a flow of thought that is must for any student to learn. All in all, ICAI has showcased excellent efforts in facelifting the way modules are prepared.

Has ICAI provided any scheme of weight for the new syllabus?

ICAI has offered scheme of the weight of the new syllabus. You can access it here – click here. We have enumerated below Ind AS Lab’s take on the new scheme which might help you before you initiate your exam prep.

What is the weight provided to theory topics and/or practical topics?

Hopefully, there would be more weight on practical topics and less weight on theory topics. However, the distinction between a practical and a theory topic can be very thin. For example, the concept of ‘control’ under consolidated financial statement needs a lot of theoretical discussions, however, the same has been practically very relevant to establish group structure.

Which are the main / most important topics (having most weight of marks)?

We believe ICAI will continue to offer higher weight to issues such as Consolidation, Business Combinations, Restructuring, and Financial Instruments.

What should be the thought process when a student begins to study the new syllabus?

This question is very relevant. The student has to structure his effort before he begins his study. Haphazard learning will naturally result in a waste of time. For example, it is not expected to follow the index of the study-module published by ICAI. Doing so may create conceptual challenges. For example, if you read Chapter 3, 4, and 5 and now you want to jump to chapter 6 where the concept of ‘fair value’ is also discussed, this may cause immediate damage to the confidence you gained while reading previous chapters. And subsequently, if you move ahead to chapter 7 to read Regulatory Deferral Account, you would lose your interest in the subject. Hence, having a road map that will maintain your motivation to keep yourself attached to the subject is very relevant. We at Ind AS Lab do exactly the same thing. We create logical mind maps and stimulus to create a logical chain reaction of study prep. By going deep into ‘why it is what it is’ we would not only be working on the subject but also on you and your thinking abilities.

What is the ideal study plan/ strategy for FR w.r.t. New syllabus?(which topic should be studied first/ which topics should be given more importance/ which are the theory topics)?

We can give you a broad study road map. Logically you should begin with framework and presentation standards. Subsequently, you should move to asset and liability based standards. After this, you must learn financial instruments and fair value measurement. Once you reach this stage, you must have gained a lot of confidence. Now is the time to dwell into consolidated financial statements and business combinations. At this moment you can also study restructuring. Now, you can study industry based standards such as insurance, regulatory deferral and first-time adoption of Ind AS. Whatever you have learned till now possibly will cover 70 to 80 marks of your CA final syllabus. Now you have a choice to either learn concepts such as CSR, Value Added statements, and Human Resource Accounting or Previous GAAP.

Are the theoretical topics important? (How can a student score more by studying the theory topics)

We always believed in a logical understanding of the topics. If you read theory and you could not comprehend out of it, your entire time investment would be a waste. It is considerably important for your tutor to empower you logically. There cannot be another better way.

Has ICAI published practice manual? How should a student practice till practice manual is published?

ICAI has not published practice manual. Ind AS Lab has more than 400 case studies. You can wish to use a resource that has been created out of the national and international experience of Ind AS/ IFRS implementation and tutoring of more than 2500 Indian Chartered Accountants.

How many months will be required to complete the FR syllabus? (Minimum hours of study student will have to devote to FR)

Bare minimum three months are needed to complete the entire syllabus. There cannot be a short cut. Any short cut will be reflected in low marks.


New Syllabus Vs. Students


With ICAI publishing some topics of the financial reporting subject at CA final level though the commotion regarding the syllabus has reduced, the question that continues to haunt as a student is the scope of Ind AS. Ind AS is one of the key additions to the CA final curriculum and one of the most important one also.  Understanding the Ind AS and its application is a necessity of the CA fraternity to cope up with the international accounting scenarios.
The index pages reveal inclusion of all the Ind AS though the level of complexity expected will be clear after the material is published.

The introduction of the new syllabus has led to considerable anxiety among the students’ community. Whether the complexity has been increased, what are the new topics, since no previous references are available how students will prepare and so on.
ICAI announced that the syllabus would be published in bits and parts until 15th September 2017 and ICAI has published the few topics of FR on 25/8/17.

Student’s perspective

  1. The ICAI material has the new style of presentation.  Color combinations have been used to make the material appealing to students.
  2. After seeing the initial pages,i.e. the index, it is observed that there are seven modules for financial reporting under the new syllabus whereas there were only three modules under the old syllabus. Does this mean that the scope of FR has been increased extensively? Are there many additional topics that have been introduced?
  3. Additional topics like accounting for carbon credits, Human Resource reporting, corporate social responsibility have been added to the syllabus.  Most of the additional topics seem to be theoretical or have basic practical questions.

Topic wise one line review

  1. Framework for preparation and presentation of financial statements:  The same concepts have been learned at the IPCC level as well.  Definitely one of the easiest topics.
  2. Business combinations and corporate restructuring:  The concepts of amalgamation were included in the IPCC syllabus. The content at final level is advanced and includes the application of Ind AS. Basics studied at the IPCC level have to be revised, to begin with the studying of the material. 
  3. Accounting for share based payments: A relatively new topic.
  4. Analysis of financial statements: A theory topic requiring complete practical understanding. A general topic including the application of audit and general understanding of all the topics of CA syllabus.
  5. Accounting of carbon credits: New topic at CA Final level.
  6. Accounting for e-commerce business: Altogether New Concept at CA Final level. 
  7. Integrated accounting: Altogether New Concept at CA Final level. 
  8. CSR: Altogether New Concept at CA Final level. 
  9. Human resource reporting: New topic at CA Final level
  10. Value added statement: New topic at CA final level

Topics & Marks Allocation


Accounting Standards and Guidance have traditionally been tested at 32 marks and in recent exams, the mark allocation has elevated to 40 marks.
Accounting for Corporate Restructuring has been tested for 16 marks and we believe the weight to remain similar to previous weight.
Consolidated Financial Statements have been tested for 16 marks in the previous syllabus. Under the new scheme, there could be
additional weight to marking grid of consolidation and business combination. Potential areas of testing would be valuation of goodwill, and non-controlling interest, adjustments related to unrealized profits, cross holding, and valuation of associates and joint ventures using equity method.
ICAI has been testing on Financial Instruments since November 2010 examination. Initially, weight was around 16 marks, primarily due to 
introduction of new standards on financial instruments viz AS 30, 31 and 32 during that time. Over a passage of time, the weight has been reduced to 8-10 marks. Often ICAI has asked questions on compound financial instruments that required students to segregate between equity and debt component. Apparently, such questions were testing ability of students to calculate present value using relevant discount rates and report measurement changes over financial periods. With introduction of Ind AS we believe that the weight of financial instruments will be reinstated to 16 marks. India is one of the first nations to adopt IFRS 9 in the form of Ind AS 109 globally. The main areas of testing would be classification of financial assets and liabilities such as Amortised Cost, FVTPL and FVTOCI; Preference shares, Effective Interest Method, Impairment using Expected Credit Loss model and Hedge Accounting.
Students must ensure that they have 
fundamental understanding of derivative instruments and their usage as a hedging instrument.
There is no separate chapter on valuation under new syllabus. However, it is interesting to observe that valuation of Intangibles has previously been tested 6 times out of 13 attempts. Under Ind AS fair valuation of intangibles can be made only if an 
active market is present for such intangibles. While we performed Ind AS implementation of few Phase I and Phase II entities, we observed entities inclined towards a cost model than a revaluation model. Even as at the date of adoption entities could not claim fair value of acquired intangibles purely because many of them failed to prove existence of active market. As fair valuation has become integral part of the syllabus under Ind AS regime in the form of Ind AS 113 Fair Value Measurement, we can expect theoretical questions on valuation of tangible and intangible assets.
Valuation of liabilities has previously been tested only once. However, we expect at least one question on
valuation of liabilities in one off event. Had we been the examiner, we would definitely have tested you on this concept simply to differentiate better students from ordinary students.
Valuation of Shares has been tested consistently across all previous attempts. ICAI has been testing this concept for 10 to 16 marks. Another observation is that ICAI has been 
choosy to test either on valuation of intangibles or on valuation of shares in all previous attempts. The foundation of Ind AS itself is a fair valuation. Having said that, we can expect some calculations around this concept tested even under new syllabus as a part of financial instrument and fair valuation chapters (Chapter 6, Unit 3).


ICAI has tested on valuation of business approximately 4 times in 13 previous attempts. The frequency was low may be because similar questions are expected in ‘Strategic Financial Management’ Paper. However, this concept may be tested under ‘Business Combinations (Chapter 15)’ under New syllabus. We expect overall weight for Business Combination, Consolidation, Valuation, and corporate restructuring to be around 48 marks.
Thanks to ICAI for completely eliminating the concept of Financial Reporting for Financial Institutions. It was first tested on May 2011 for 6 marks and subsequently tested in almost each attempt. However, the weight of this chapter was  varyingfrom 16 marks in initial years to 4 marks in recent years. Under new syllabus, we have few industry specific standards and few newly introduced concepts in the form of new accounting standards. For example, we have to learn 
accounting for insurance contracts, agriculture, and exploration and evaluation of mineral resources. We believe that potential marks allocated to these concepts would range from 4 marks to 6 marks.
There are few more allied topics such as value added statements, economic value added and human resource reporting. New Syllabus has ensured continuity of Human Resource Reporting (Chapter 23) and Value Added Statements (Chapter 24). Both of these chapters may be tested for 12 marks together. Additionally, ICAI has introduced another new chapter ‘Corporate Social Responsibility (Chapter 22).’
CSR has gained sudden importance in the board meets. There are few Ind AS implications too. For example, CSR expenditure that needs to be allocated mandatorily (as required by companies act 2013) may not be either statutory or constructive obligation unless entity commits towards
specific purpose. In which case, CSR expenditure may not be provision within the context of Ind AS 37 unless features to be classified as a provision/ liability are achieved. We expect 4-6 marks at least one question on this concept.
Another fact that all students must note is 
existence of previous GAAP in new syllabus. Chapter 1 explains few previous GAAP standards such as standards for employee benefits, consolidated financial statements, interim financial reporting, impairment of assets and accounting for associates and joint ventures. ICAI may create three types of questions. The first type could be consolidation question to be solved  on the basis of previous GAAP (likelihood of which is low). The second type could be 6-8 mark question on independent concepts such as accounting for investments in joint ventures and associates under the previous GAAP. The third type could be a question on differentiation between previous GAAP and Ind AS (for example actuarial gains and losses are taken to OCI under Ind AS which under previous GAAP are accounted through profit and loss). One single 6 marks question on impairment of assets under previous GAAP can also be another likelihood.

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