UPSC CSE Commerce and Accountancy Optional Syllabus

Accounting and Finance Accounting, Taxation & Auditing

• Financing Accounting :
  Accounting as a financial information system; Impact of behavioural sciences. Accounting
  Standards e.g., Accounting for Depreciation, Inventories, Research and Development
  Costs, Long-term Construction Contracts, Revenue Recognition, Fixed Assets,
  Contingencies, Foreign Exchange Transactions, Investments and Government Grants,
  Cash Flow Statement, Earnings per Share.
  Accounting for Share Capital Transactions including Bonus Shares, Right Shares.
  Emplyees Stock Option and Buy-Back of Securities.
  Preparation and Presentation of Company Final Accounts.
  Amalgamations, Absorption and Reconstruction of Companies.
• Cost Accounting :
  Nature and functions of cost accounting. Installation of Cost Accounting System. Cost
  Concepts related to Income Measurement, Profit Planning, Cost Control and Decision
  Making.
  Methods of Costing: Job Costing, Process Costing, Activity Based Costing.
  Volume-cost-Profit Relationship as a tool of Profit Planning.
  Incremental Analysis/Differential Costing as a Tool of Pricing Decisions, Product
  Decisions, Make or Buy Decisions, Shut-Down Decisions etc.
  Techniques of Cost Control and Cost Reduction : Budgeting as a Tool of Planning and
  Control. Standard Costing and Variance Analysis.
  Responsibility Accounting and Divisional Performance Measurement.
• Taxation :
  Income Tax: Definitions. Basis of charge; Incomes which do not form part of total
  income. Simple problems of Computation of Income (of individuals only) under various
  heads, i.e., Salaries, Income from House Property, Profits and Gains from Business or
  Profession, Capital Gains, Income from other sources, Income of other Persons included
  in Assessee’s Total Income.
  Set-off and Carry forward of Loss.
  Deductions from Gross Total Income.
  Salient Features/Provisions Related to VAT and Services Tax.
• Auditing :
  Company Audit: Audit related to Divisible Profits, Dividends, Special investigations, Tax
  audit.
  Audit of Banking, Insurance, Non-Profit Organization and Charitable
  Societies/Trusts/Organizations.

Financial Management, Financial Institutions and Markets

• Financial Management :
  Finance Function : Nature, Scope and Objectives of Financial Management : Risk and
  Return Relationship.
  Tools of Financial Analysis: Ratio Analysis, Funds-Flow and Cash-Flow Statement.
  Capital Budgeting Decisions: Process, Procedures and Appraisal Methods. Risk and
  Uncertainty Anlysis and Methods.
  Cost of Capital : Concept, Computation of Specific Costs and Weighted Average Cost of
  Capital. CAPM as aTool of Determining Cost of Equity Capital.
  Financing Decisions: Theories of Capital Structure—Net Income (NI) Approach.
  Net Operating Income (NOI) Approach, MM Approach and Traditional Approach.
  Designing of Capital structure: Types of Leverages (Operating, Financial and Combined),
  EBIT-EPS Analysis, and other Factors.
  Dividend Decisions and Valuation of Firm : Walter’s Model, MM Thesis, Gordan’s Model
  Lintner’s Model. Factors Affecting Dividend Policy.
  Working Capital Management: Planning of Working Capital. Determinants of Working
  Capital. Components of Working Capital—Cash, Inventory and Receivables.
  Corporate Restructuring with focus on Mergers and Acquisitions (Financial aspect only).
• Financial Markets and Institutions :
  Indian Financial System: An Overview
  Money Markets: Participants, Structure and Instruments. Commercial Banks. Reforms in
  Banking Sector. Monetary and Credit Policy of RBI. RBI as a Regulator.
  Capital Market : Primary and Secondary Market. Financial Market Instruments and
  Innovative Debt Instruments; SEBI as a Regulator.
  Financial Services : Mutual Funds, Venture Capital, Credit Rating Agencies, Insurance and
  IRDA.