THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA (Established by Act of Parliament No.15 of 1965) SYLLABUS FOR ENTRY TO THE CHARTERED ACCOUNTANCY PROFESSION and Regulations Effective from May 2005 2005 FOREWORD The Institute has come a long way since its first home based examinations in 1970. Remember that the Institute came into being in September 1965 by an Act of Parliament. The last review of the Institute syllabus was done in 1997 and it became operational in 1998. Since then a lot of water has passed under the bridge. This current review, was done in order to strengthen the necessary building blocks for an accomplished Chartered Accountant of the 21st Century. The important areas of departure between the present syllabus and the preceding one are as follows: (i) Total number of subjects:There are now nineteen (19) as opposed to the previous eighteen (18) subjects (ii) Modules Structure (a) The former Foundation Module which composed of Module A and Module B is now condensed to only one to be called Foundation (b) The Professional Examinations (PE) broken up into P.E. I and P.E. II are now made up of Professional Examination I; Professional Examination II and Professional Examination III. The rationale of expanding the Professional Examinations is to give students enough room to study the various levels at a greater depth. (c) (iii) Intermediate remains Intermediate Issue of Credit System With the coming into force of this new syllabus, students will now be credited with the subjects they pass, provided at least two papers have been passed at any one sitting. This new provision will remove the “punitive” measure of “taking all papers” once a “double-star” is scored in any subject. (iv) ICAN sponsored Study Packs Competent professionals have been commissioned to write manuals to be called ICAN study packs that will be good guides to the students. This bold step by the Institute is a welcome development and the authors of such manuals should be commended. Finally, we believe our students will now be in a better position to study and pass the examinations without much fuss and the education they receive will be a great asset to their prospective employers. Zubai A. Abdullah Chairman Students’ Affairs Committee 2 Contents FOREWORD……………………………………………………………….…………… 1 PART ONE 1. 2. 3. 4. 5. 6. 7. 8. 9. 10. 11. 12. 13. 14. Introduction …………………………………………………… Objects and Duties ……………………………………………………. Membership …………………………………………… Chartered Accountants …………………………………………… Registered Accountants …………………………………………… Designatory letters ..………………………………………….. The Practice of Accountancy in Nigeria……………………………… Advertisements for Business………………………………………….. The Library ……………………………………………. District Societies ……………………………………………. Publications ……………………………………………. Training Schemes ……………………………………………. (i) Definition of Training…………………………………… (ii) Approved Work of Accounting Nature……………….. (iii) Recognised Training Centres ……………………….. Practising Licence …………………………………………… Secretariat …………………………………………… 4 4 4 4 5 5 5 6 6 6 6 7 7 7 7 8 8 PART TWO 15 15.1 15.2 15.3 STUDENTSHIP REGISTRATION AND TRAINING………………. 9 Approved Qualifications for Registration…………………………… 9 Application for Registration …………………………………. 9 Conditions to be satisfied …………………………………………. 10 PART THREE 16. PROFESSIONAL EXAMINATIONS……………………………….. 11 16.1 Structure of the Syllabus ………………………………………… 11 16.2 Dates of Examinations ………………………………………… 12 16.3 Closing Dates of Entries ………………………………………… 12 16.4 Examination Entry ………………………………………………… 12 16.5 Examination Results……………………………………………….. 12 16.6 Credit System …………………………………………………….. 12 16.7 Pass Mark ……………………………………………………….. 12 16.8 Conversion Arrangements ……………………………………….. 12 16.8.1 Foundation ……………………………………………………… 13 16.8.2 Intermediate Examination ……………………………………… 14 16.8.3 Professional Examination I ……………………………… 14 16.8.4 Professional Examination II ……………………………… 15 17 Examination Time Table for May 2005 ……………………… 15 18. Examination Question Format…………………………………… 15 19 Absence from an Examination …………………………………. 16 3 Misconduct in an Examination ……………………………… Exemption Guidelines …………………………………… Academic Qualifications ………..……………………………… Subject by Subject Exemption………………………………… Professional Qualifications……………………………………… Lecturers in Higher Institutions……….………………………… 16 17 17 18 19 19 21 21.1 EXAMINATIONS SYLLABUS ……………………………… FOUNDATION …………………………………………… 20 20 21.1.1 21.1.2 21.1.3 Fundamentals of Financial Accounting ……………………… Quantitative Analysis ……………………………………… Economics ……………………………………… 20 24 32 21.2 INTERMEDIATE ……………………………………… 36 21.2.1 21.2.2 21.2.3 21.2.4 Cost Accounting ………………………………………….. General Principles of Law …………………………………….. Principles and Practice of Auditing …………………….. Management …………………………………………….. 20 20 20.1 20.2 20.3 20.4 PART FOUR 36 40 43 47 PROFESSIONAL EXAMINATIONS 21.3 21.3.1 21.3.2 21.3.3 21.3.4 PROFESSIONAL EXAMINATIONS I ….…………………… Financial Accounting I ……………………………………… Taxation ……………………………………… Management Information Systems ……………………… Business Law ……………………………………… 21.4 PROFESSIONAL EXAMINATION II 21.4.1 21.4.2 21.4.3 21.4.4 Financial Accounting II …………………………………….. Management Accounting ……………………………………… Public Sector Accounting and Finance ……………………….. Business Communication and Research Methodology …….. 68 71 76 81 21.5 21.5.1 21.5.2 21.5.3 21.5.4 PROFESIONAL EXAMINATION III ………………………….. Financial Reporting and Audit Practice………..……………….. Strategic Financial Management………….. …………………… Tax Management and Fiscal Policy ………………………….. Multidisciplinary Case Study ………………………………….. 85 85 90 95 99 4 …………………….. 52 52 56 60 65 68 THE INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA Students’ Regulations and Examination Syllabus PART ONE 1. INTRODUCTION The forerunner of the institute under the name “The Association of Accountants in Nigeria” was established in 1960. This Association was absorbed by the Institute created by an Act of Parliament No. 15 (The Act) which came into force on September 1, 1965. The Institute has, as at July 31, 2004, 17,377 members and 99,963 students on its Register. 2. OBJECTS AND DUTIES The objects and duties of the Institute as laid down in section 1 (1) of the Act, are: 3. (a) “determining what standards of knowledge and skill are to be attained by persons seeking to become members of the accountancy profession and raising those standards from time to time as circumstances may permit; (b) securing in accordance with the provisions of the Act, the establishment and maintenance of registers of Fellows, Associates and Registered Accountants entitled to practise as accountants and auditors and publishing from time to time lists of those persons; and (c) performing through the Council under this Act the functions conferred on it by the Act.” MEMBERSHIP There are two main classes of membership of the Institute, namely; Chartered Accountants and Registered Accountants. 4. CHARTERED ACCOUNTANTS A person shall be enrolled as a Chartered Accountant if: (a) he passes the qualifying examination for membership conducted by the Council of the Institute and completes a prescribed practical training (Section 8(1)(a); or (b) he holds a qualification granted outside Nigeria and for the time being accepted by the Institute, and he satisfies the Council of the Institute that he had sufficient practical experience as an Accountant (Section 8(1)(b). 5 A member of any of the following professional bodies: (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) The Institute of Chartered Accountants in England and Wales; The Institute of Chartered Accountants of Scotland; The Institute of Chartered Accountants in Ireland; The Association of Chartered Certified Accountants; The American Institute of Certified Public Accountants; The Canadian Institute of Chartered Accountants; The Chartered Institute of Management Accountants; The Chartered Institute of Public Finance and Accountancy; Shall be eligible under the present Rules and Regulations of the Institute to be enrolled as a Chartered Accountant, in pursuance of section 8 (1) (b) of the Act after undergoing an orientation course/seminar during which Law, Public Sector Accounting & Finance, Financial Reporting and Audit Practice and Tax Management and Fiscal Policy would be the main subjects of intense discourse. Furthermore, the candidate would be required to make an oral presentation before admission. 5. REGISTERED ACCOUNTANTS A person is entitled to be registered as a Registered Accountant if he satisfies the Council of the Institute that immediately before the appointed day (i.e. September 1, 1965), he has had not less than five years experience as an inspector and auditor of company affairs under the provisions of the Companies and Allied Matters Act, 1990. See Section 8 (2) of the Act. 6. DESIGNATORY LETTERS Every member of the Institute is entitled to use the following designatory Letters after his name: In the case of a Fellow, the letters “FCA” (Fellow of the Institute of Chartered Accountants) In the case of an Associate, the letters “ACA” (Associate of the Institute of Chartered Accountants). In the case of a Registered Member, the letters “RA” Accountant). 6 (Registered 7. THE PRACTICE OF ACCOUNTANCY IN NIGERIA Only members of the institute are entitled to practise as Accountants in Nigeria in accordance with the provisions of Section 8(2) of the Act which states: “If, on or after the appointed day (September 1, 1965), any person not being a member of the Institute practises as an Accountant, he shall be guilty of an offence”. However, a member of the Institute is not allowed to set up a public practice as an accountant until he has applied for, and has been granted a licence to practise by the Council, and a member is not eligible for this licence until he has, for a continuous period of thirty months before or after or partly before and partly after becoming a member of the Institute, been employed in a responsible accountancy position in the office of a qualified accountant in public practice in Nigeria or elsewhere (Membership Rules 12 and 13 made in pursuance of Section 15(2)(d) and (e) of the Act). 8. ADVERTISEMENTS FOR BUSINESS Subject to the guidance which follows a member may seek publicity for his or her services, achievements and products and may advertise his services, achievements and products in any way consistent with the dignity of the profession in that he should not project an image inconsistent with that of a professional person bound to high ethical and technical standards. 9. THE LIBRARY The Institute’s Library caters for both members and students. The Library at the Secretariat at Plot 16 Idowu Taylor Street, Victoria Island, Lagos caters for the reading, lending and reference needs of members, while the Students’ Library is located at the Institute’s Secretariat Annex at No. 82, Murtala Muhammed Way, Ebute-Metta, Lagos. Continuous efforts are being made by the Council from time to time to satisfy fully the diverse interests of the members and students. Enquiries should be directed to the Librarian at the Victoria Island Office. 10. DISTRICT SOCIETIES There are DISTRICT SOCIETIES of members of the Institute with headquarters in some principal towns throughout the country and in London. The principal objectives of the District Societies are to avail members the opportunity of extra professional and social activities and assist potential accountants in their endeavour towards membership of the Institute. 11. PUBLICATIONS The Institute publishes the following for the benefit of members, students and the general public: 7 12. (a) “Membership Year Book”, containing lists of members and other general information about the Institute (b) “The Nigerian Accountant”, the official journal of the Institute, containing authoritative articles on accountancy and related fields (c) “ICAN News”, the official journal for students of the Institute (d) “Pathfinder”, published after each examination on the suggested solutions to the preceding examinations. (e) “Members’ Handbook” which is a compendium of the Institute’s constitutional, ethical and legal provisions and Accounting, auditing and reporting standards. TRAINING SCHEMES (i) DEFINITION OF TRAINING Training for the purpose of the Institute’s membership means full time assignment on a work of an approved accounting nature either in a professional office, commerce, industry, government or a full time/part time study in an accredited institution. However, accounting experience acquired before a candidate attains the minimum educational level required for registration would not be recognised, but only the practical experience acquired by the candidate as from the date of registration as a student. (ii) APPROVED WORK OF ACCOUNTING NATURE An accounting duty is deemed to be approved when such a duty is being supervised by a Chartered Accountant member of the Institute or being subjected to regular audit by a professional firm of Chartered Accountants in Nigeria. In the Civil Service, however, the supervision by a Chartered Accountant member of the Institute is not strictly necessary (Civil Service accounting systems throughout the Federation having been recognised as providing adequate training ground for accountants in the Public Sector). (iii) RECOGNISED TRAINING CENTRES The Institute attaches considerable importance to practical training and students are required to acquire their practical experience in Recognised Training Centres (RTC). 8 The Institute recognises for this purpose: (a) (b) (c) Approved service under a practising member of the Institute. Employment in the office of a practising accountant, for example, as an audit clerk. Employment in the accounting or finance department of industrial or commercial undertakings, parastatals and the Public Service. If a candidate wishes to train otherwise than in a Recognised Training Centre, his particular employment has to be approved by the Council as providing acceptable experience. For this purpose, he has to give precise details of the nature of his work together with a certificate from a senior officer of the organisation (who has to be a member of the Institute) stating that he will, during the course of his studentship, obtain experience of adequate scope and variety. The period of practical experience sufficient for a candidate to be accomplished as an accountant depends on the relevance of his basic qualifications on registration. This is expected to be not less than 24 months practical training whilst those entering with non-accounting qualifications will require 42 – 48 months. 13. PRACTISING LICENCE The licence to practice will be issued only to those candidates who have been trained in professional offices and have acquired the minimum practical training as stated in paragraph 7 above. However, for those who qualify outside professional offices/firms, such practising experience could be acquired after qualifying as an accountant and the minimum period of postqualification will not be less than 30 months. 14. SECRETARIAT The Institute’s Secretariat is located at: For those submitting their completed forms by hand or making enquiries, please call at our Secretariat Annex. Plot 16, Idowu Taylor Street Victoria Island P.O. Box 1580 (a) No. 82, Murtala Mohammed Way, Lagos, Nigeria Opp. Denton Police Station Tel: (234) (01) 2622394 2617638, Tel: 234: 7740627, 4705336. 2614235 Ebute-Metta Fax: (234) (01) 2610304 ICAN Lagos Offices & District E-Mail: Info.ican@ican.org.ng Societies. Website: www.ican-ngr.org (b) Liaison offices (c) District Societies All enquiries should be directed to the Registrar/Chief Executive. 9 PART TWO 15. STUDENTSHIP REGISTRATION AND TRAINING 15.1 APPROVED QUALIFICATIONS FOR REGISTRATION In order to register as a student with the Institute, an applicant must hold a qualification not below University degree or its equivalent. The Council has accepted the following qualifications for the purpose of entry requirements: (a) The degree of any University or Higher National Diploma of any Polytechnic recognised by the Council. (b) Any other qualification hereafter to be approved by the Council. Approved meanwhile are: (i) (ii) (iii) (iv) (v) (vi) (vi) (vii) (viii) (ix) 15.2 The final examination of the Institute of Chartered Secretaries and Administrators; The final examination of the former Corporation of Secretaries; The final examination of the Association of International Accountants; The final examination of the Chartered Institute of Bankers of Nigeria; The final examination of the Chartered Institute of Stockbrokers; The final examination of the Chartered Institute of Taxation of Nigeria The final examination of the Association of Accounting Technicians U.K.; The final examination of the Association of National Accountants of Nigeria (ANAN); Executive Management Accountancy (Federal Treasury Training School, Stage III) The final ATS Examination of the Institute of Chartered Accountants of Nigeria; APPLICATION FOR REGISTRATION Application for registration as a student must be made on the prescribed form purchased from the Institute which requires an undertaking on the part of the applicant to abide by the rules and regulations laid down by the Council from time to time. Every applicant will be required to produce satisfactory evidence of his name, age and character together with certified photocopies of educational certificates and two certified passport size photographs. The Council reserves the right to grant or refuse any application or to terminate the registration of a student. Applicants must comply with the conditions set forth and must pay the registration fee in force at the date of application. If the application to register is unsuccessful the registration fee is not refundable. 10 The annual subscription for successful applicants becomes payable immediately upon registration for the year of registration and thereafter on 1 st January of each year of registered studentship. 15.3 CONDITIONS TO BE SATISFIED Every applicant for registration as a student must satisfy the Council that: (a) (b) (c) He is not less than 16 years of age He possesses the basic educational qualifications set out above; and He is a fit and proper person to be registered. 11 PART THREE 16. PROFESSIONAL EXAMINATIONS 16.1 STRUCTURE OF THE SYLLABUS The professional examination of the Institute consists of the following five levels: Foundation, Intermediate, Professional I, Professional II and Professional III. OLD SYLLABUS NEW SYLLABUS FOUNDATION FOUNDATION Module A 1. 2. 3. Accounting Framework Economics Law I 1. 2. 3. Fundamentals of Financial Accounting Quantitative Analysis Economics Module B 4. 5. 6. Quantitative Analysis Law II Management INTERMEDIATE 7. 8. 9. 10. Financial Accounting I Cost Accounting Auditing Taxation INTERMEDIATE 4. 5. 6. 7. Cost Accounting General Principles of Law Principles and Practice of Auditing Management PROFESSIONAL EXAMINATION I 8. 9. 10. 11. Financial Accounting I Taxation Management Information Systems Business Law PROFESSIONAL EXAMINATION I PROFESSIONAL EXAMINATION II 11. 12. 13. 14. 12. 13. 14. 15. Financial Accounting II Management Information Systems Public Sector Accounting and Finance Management Accounting Financial Accounting II Management Accounting Public Sector Accounting and Finance Business Communication and Research Methodology PROFESSIONAL EXAMINATION II PROFESSIONAL EXAMINATION III 15. 16. 17. 18. 16. 17. 18. 19. Financial Reporting and Audit Practice Corporate Finance and Financial Strategy Tax Management and Fiscal Policy Multidisciplinary Case Study 12 Financial Reporting and Audit Practice Strategic Financial Management Tax Management and Fiscal Policy Multidisciplinary Case Study 16.2 DATES OF EXAMINATIONS The examinations are normally held twice each year in May and November and, at present, at the following centres: Aba, Abakaliki, Abeokuta, Abuja, Ado-Ekiti, Akure, Asaba, Benin-City, Calabar, Enugu, Ibadan, Ilesa, Ilorin, Jos, Kaduna, Kano, Lagos, Lokoja, London (UK), Maiduguri, Makurdi, Minna, Ogbomoso, Onitsha, Owerri, Port Harcourt, Sokoto, Umuahia, Uyo, Warri, Yenagoa and Yola. At the discretion of the Council, examinations may be arranged at centres other than those specified above. 16.3 CLOSING DATES OF ENTRIES The closing date for the May Examinations is 31st March and that of November is 30th September. 16.4 EXAMINATION ENTRY No person may enter for any of the Institute’s examinations unless he has been registered as a student of the Institute and has paid the required annual subscription and examination entry fees in force at the date of entry. 16.5 EXAMINATION RESULTS The result of the examination will be communicated by post, or through the Institute’s website to each candidate, but further correspondence relating to individual results cannot be entertained. No information as to individual marks can be given. 16.6 CREDIT SYSTEM FOUNDATION, INTERMEDIATE, PROFESSIONAL LEVELS I & II Candidates writing the above stated levels of the Examination will be CREDITED for every single subject passed in the first instance and subsequently. PROFESSIONAL LEVEL III Candidates are expected to pass at least 2 papers at first sitting in order to obtain credits in the papers passed. The remaining TWO papers could be passed and credited at one per sitting. NOTES: Candidates are expected to register and attempt all papers at a level. No candidate will be allowed to apply to sit for one paper unless the other papers have been previously passed or exempted. Candidates are also expected to complete examination at a lower level before attempting the higher level. CANDIDATES ARE NOT ALLOWED TO COMBINE TWO LEVELS of the examinations. Candidates are expected to complete all levels of the institute’s examinations within 10 YEARS of registration as a student of the institute. 13 16.7 PASS MARK The pass mark of the Institute’s examination is 50%. 16.8 CONVERSION ARRANGEMENTS Examinations on the basis of the new syllabus will commence in May 2005. Pursuant to the implementation of the credit system, at the November 2004 examination, all candidates will be converted to the new syllabus. Each candidate will be credited with those subjects passed provided he or she passes a minimum of two subjects at that level. Only the new syllabus will be examined in May 2005 and thereafter. Except where specifically provided for in the arrangement, no candidate may proceed to the next level of examination without successfully completing all the subjects in the preceding level. 16.8.1Conversion from the old to the new syllabus is as stated hereunder: OLD SYLLABUS OLD FOUNDATION Candidates who successfully completed the old Foundation A and B examinations. Candidates who successfully completed the old Foundation A examination only. Candidates who successfully completed the old Foundation B examination only. Candidates who passed two subjects of the Old Foundation A but have NOT completed the module at the November 2004 examination Candidates who passed two subjects of the Old Foundation B but have NOT completed the module at the November 2004 examination Candidates taking referred papers at the Foundation A in November 2004. Candidates taking referred papers at the Foundation B in November 2004. Candidates who failed the old Foundation examination in November 2004. NEW SYLLABUS NEW FOUNDATION AND INTERMEDIATE TO WRITE CREDITED WITH Papers 4 and 6 i.e. Cost All subjects of new Foundation plus Accounting and Principles General Principles of Law and & Practice of Auditing at Management at the Intermediate the New Intermediate level level; and Business Law at P.E. I level Paper 2 i.e. Quantitative All subjects of new Foundation except Analysis at the new Quantitative Analysis plus General Foundation Principles of Law at the Intermediate level Papers 1 and 3 i.e. Quantitative Analysis at the new Fundamentals of Financial Foundation, Management at the Accounting and Intermediate and business Law at the Economics at the new new P.E. I Foundation Subject failed Subjects passed or their equivalents in the new syllabus Subject failed Subjects passed or their equivalents in the new syllabus Subject failed Subjects previously passed or their equivalents in the new syllabus Subject failed Subjects previously passed or their equivalents in the new syllabus The new Foundation from May 2005 examination. NIL 14 16.8.2 OLD INTERMEDIATE EXAMINATION NEW INTERMEDIATE AND PROFESSIONAL EXAMINATION I TO WRITE CREDITED WITH Candidates who passed the old All Subjects of new Intermediate Examination at the Paper 10 i.e. Management Foundation, Intermediate and November 2004. Information Systems at the P. E. I. Levels except paper New P.E.I level 10 i.e. Management Information Systems Candidates who failed the old Papers 4 and 6 i.e. Cost All subjects of new Intermediate examination in Accounting and Principles Foundation plus General November 2004. and Practice of Auditing at Principles of Law and the new Intermediate level Management at the Intermediate level; and Business Law at P.E. I level. Candidates to take referred The referred subjects and All Subjects of new papers in November 2004. paper 10 i.e. Management Foundation, Intermediate and Information systems. P. E. I. Levels except the referred subjects and paper 10 i.e. Management Information Systems 16.8.3 OLD PROFESSIONAL EXAMINATION I Candidates who were successful in the old Professional Examination I in November 2004. Candidates who failed the old Professional Examination I in November 2004 Candidates taking referred papers in November 2004 NEW PROFESSIONAL EXAMINATION I AND II TO WRITE Paper 15 i.e. Business Communication and Research Methodology of the new P.E. II Paper 10 i.e. Management Information Systems at the New P.E.I level The referred subjects and paper 15 at the new P.E. II i.e. Business Communication and Research Methodology 15 CREDIT WITH All subjects in the new Foundation, Intermediate, P. E. I and P.E. II except paper 15 i.e. Business Communication and Research Methodology All subjects in the new Foundation, Intermediate and P.E. I except paper 10 i.e. Management Information Systems All subjects in the new Foundation, Intermediate, P. E. I and P.E. II except the referred subjects and paper 15 i.e. Business Communication and Research Methodology 16.8.4 OLD PROFESSIONAL EXAMINATION II NEW PROFESSIONAL EXAMINATION III TO WRITE All subjects of the new Professional Examination III The referred subjects or their equivalents in the new syllabus Candidates who failed the old Professional Examination II in November 2004. Referred candidates in the old Professional Examination II who have a reference in the November 2004 examination. Referred candidates in the old Professional Examination II who have one chance remaining after the November 2004 examination. CREDITED WITH All subjects of the new Foundation, Intermediate, P.E.I and P.E. II All subjects of the new Foundation, Intermediate, P.E.I, P.E. II and P.E. III except the referred subjects All subjects of the new Foundation, Intermediate, P.E.I, P.E. II and P.E. III except the referred subjects The referred subjects or their equivalents in the new syllabus 17. EXAMINATION TIME-TABLE DAY TUESDAY WEDNESDAY THURSDAY 18 INTERMEDIATE Cost Acctg. P.E.1 P.E. II P.E. III 9.00 a.m.- 12.00 noon FOUNDATION Fund. of Fin. Acctg. Fin.Acctg. I Fin. Accctg. II Fin. Reporting & Audit Prac. 2.00 p.m. – 5.00 p.m. Economics Management M.I.S. Tax Mgt. & Fiscal Policy 9.00 a.m. – 12.00 noon Quantitative Analysis Principles & Practice of Auditing Taxation Bus. Comm. & Research Methodology Mgt. Acctg. 9.00a.m. - 3.30 p.m. _ General Principles of Law - - Public Sector Acctg. & Finance - Strategic Fin. Mgt. MultiDisciplinary Case Study EXAMINATION QUESTION FORMAT The questions for each subject shall consist of two parts: A & B. Section A: Shall comprise multiple-choice and short-answer questions. Questions in this section shall cover the entire area of the subject syllabus. All the questions in this section shall be compulsory. This section shall make up 40% of the total marks. Section B: Shall comprise of more involving questions. The questions will carry equal marks. Candidates will be required to answer four out of six questions in this section. However, in subjects with simple cases, the case question in Section B will be compulsory. This section shall make up 60% of the total marks. 16 19. ABSENCE FROM AN EXAMINATION Examination entries cannot be withdrawn after the closing date in any circumstances. The fees paid for an examination will not be refunded or transferred to subsequent examination, if a candidate decided not to attend, or is unable to attend the examination. 20. MISCONDUCT IN AN EXAMINATION The examinations regulations prohibit a student from: (a) (b) (c) (d) taking into the examination room or possessing, while in that room, any books, notes or other materials except those which have been authorised in the Examination Attendance Docket; aiding or attempting to aid another candidate, or obtaining or attempting to obtain aid from another candidate; refusing to obey any instruction from the Examination Supervisor or Invigilators; giving false or misleading information to the Examination Supervisor. The Supervisor is empowered to discontinue the examination of any candidate suspected of mis-conduct and to require him/her to leave the examination room. Any student who fails to comply with the above regulations may be liable to such penalties as the Council of the Institute may determine. 17 20. 20.1 EXEMPTION GUIDELINES Academic Qualifications Exemption From A. B.Sc./HND (Accounting) obtained from Accredited institutions in Nigeria. All Subjects in Foundation level, Intermediate and P.E. I B. B.Sc./HND (Accounting) obtained from recognized institutions in Nigeria but not yet accredited by the Institute All subjects in Foundation and Intermediate C. B.Sc./B.A./HND (Accounting) obtained from foreign recognised institutions All Subjects in Foundation and Intermediate subject to acceptable transcript D. M.Sc./Ph.d (Accounting) obtained from recognized institutions in addition to B.Sc./HND in any other related discipline All Subjects in Foundation and Intermediate E. Ph.d (Accountancy) All subjects in Foundation, Intermediate, P. E. I and Business Comm. & Research Methodology in P. E. II F. B.Sc. Economics Quantitative Analysis and Economics in Foundation and Management in Intermediate B.Sc. Actuarial Science Quantitative Analysis and Economics in Foundation, Management and General Principles of Law in Intermediate B.Sc. Management Quantitative Analysis and Economics in Foundation, Management and General Principles of Law in Intermediate B.Sc./HND Insurance Quantitative Analysis and Economics in Foundation, Management and General Principles of Law in Intermediate B.Sc. Management Studies Quantitative Analysis and Economics in Foundation, Management and General Principles of Law in Intermediate B.Sc/HND Business Administration Quantitative Analysis and Economics in Foundation, Management and General Principles of Law in Intermediate B.Sc./HND Marketing Quantitative Analysis and Economics in Foundation, Management and General Principles of Law in Intermediate B.Sc./HND Banking & Finance All Subjects in Foundation and General Principles of Law and Management in Intermediate MBA in addition to B.Sc./HND in NonAccounting discipline All Subjects in Foundation and General Principles of Law and Management in Intermediate B.Sc. (Ed.) Accounting or B.Ed. Business Education (Accounting Option) All Subjects in Foundation and General Principles of Law and Management in Intermediate G. ATS II (Old Syllabus) All Subjects in Foundation and General Principles of Law in Intermediate H. ATS III (New Syllabus) All Subjects in Foundation & Intermediate and Business Law in P. E. I 18 20.2 SUBJECT BY SUBJECT EXEMPTION FOUNDATION B.Tech. Project Management EXEMPTION FROM FOUNDATION LEVEL ONLY Economics, Q/A, Management B.Sc/HND Statistics/Econs. Economics, Quantitative Analysis HND Agric/Econs Economics, Q/A, Management LL.B Principles of General Law & Business Law B.Sc/HND Estate Mgt Quantitative Analysis B.Sc/HND Biology Quantitative Analysis B.Sc/HND Chemistry Quantitative Analysis B.Sc/HND BioChemistry Quantitative Analysis B.Sc/HND Statistics Quantitative Analysis B.Sc/HND Engineering Quantitative Analysis B.Sc/HND Chemistry Engineering Quantitative Analysis B.Sc/HND Town & Regional Planning Quantitative Analysis B.Sc/HND (Ed) Chemistry Quantitative Analysis B.Sc/HND Tech. Computer Quantitative Analysis B.Sc/HND Maths Quantitative Analysis B.Sc/HND Industrial Maths Quantitative Analysis B.Sc/HND Industrial Chemistry Quantitative Analysis B.Sc/HND Agric. Quantitative Analysis B.Sc/HND Building Technology Quantitative Analysis B.Sc/HND Petroleum Engr Quantitative Analysis B.Sc/HND Elect. (Elect.) Quantitative Analysis B.Sc/HND (Ed.) Chem. Quantitative Analysis B.Sc/HND Applied Maths Quantitative Analysis B.Sc/HND Applied Chem. Quantitative Analysis B.Sc/HND Applied Physics Quantitative Analysis Public Admin – Subject to transcript Quantitative Analysis B.Sc Bus. Edu – Subject to transcript Quantitative Analysis 19 0.4 20.3 Professional Qualifications Qualifications ICAN Exemptions A. ACIB (Nigeria) B. ACIB (London) C. ACIS D. ACS E. ACII F. ACTI H. AIA (Final) 1994 to date All Subjects in Foundation, Intermediate except Principles and Practice of Auditing and Financial Accounting I in P. E. I All Subjects in Foundation, Intermediate except Principles & Practice of Auditing and Financial Accounting I in P.E. I All Subjects in Foundation and Intermediate Except Principles & Practice of Auditing All Subjects in Foundation, Management and General Principles of Law in Intermediate Quantitative Analysis and Economics in Foundation and General Principles of Law in Intermediate All Subjects in Foundation, Taxation in P.E. I. All Subjects in Foundation, Intermediate, P. E. I and P. E. II AAT (U.K) All subjects in Foundation and Intermediate I. AIA Pre-1994 J. *ACA (Ghana) K. ANAN All subjects in Foundation, Intermediate except Principle and Practice of Auditing and Financial Accounting I in P. E. I All Subjects in Foundation, Intermediate, P. E. I and P. E. II All Subjects in Foundation and Intermediate L. Executive Management Accountancy (Federal Treasury Training School Starting from 1987) ICAEW ACCA CPA CIMA CIPFA ICAS ICAI M. All Subjects in Foundation & Intermediate All Subjects in Foundation, Intermediate, P.E. I, P. E. II & P. E. III – subject to undergoing Intensive Course for special candidates 20.4 LECTURERS IN HIGHER INSTITUTIONS Lecturers in Accounting Departments with B.Sc/HND (Accounting) in all accredited institutions shall be given the same level of exemption/concession granted to graduates of Recognised Training Institutions (RTI’s) regardless of date of qualification. 20 PART FOUR 1. EXAMINATION SYLLABUS 1.1 FOUNDATION 1.1.1 PAPER 1: A. FUNDAMENTALS OF FINANCIAL ACCOUNTING AIM To examine the candidates’ B. knowledge and application of the fundamental concepts, principles, process and regulatory framework employed in keeping financial records ability to prepare financial statements for management use, for sole trader, not-for-profit organizations, partnerships, and limited liability companies. LINKAGES This paper is linked to papers 4, 5, 6, 8, 9, 11, 12, 13, 14, 16 & 17 The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Six questions out of which candidates are expected to answer four. C. CONTENTS 1. 2. THE NATURE AND PURPOSE OF ACCOUNTING (10%) (a) History and development of accounting (b) Role of an Accountant in an organisation (c) Nature, principles and scope of accounting; the role of financial accounting, cost and management accounting, financial management, auditing and taxation in the management of an organization (d) The users of financial statements; their information requirements, objectives, adequacy and the usefulness of those financial statements. THEORY OF ACCOUNTING STANDARDS AND GUIDELINES (IAS AND SAS) (15%) (a) The nature and role of bodies which set accounting standards and guidelines. (b) Accounting Standards: (i) Disclosure of accounting policies (SAS I & IAS 1) (ii) Information to be disclosed in financial statements (SAS 2 & ) IAS 5) (iii) Accounting for property, plant and equipment (SAS 3 & IAS 16) 21 3. (iv) Accounting for depreciation (SAS 9 & IAS 4) (v) Accounting for stocks (SAS 4 & IAS 2) (vi) Extra-Ordinary, Exceptional and Prior-Year Adjustments (SAS 6 & IAS 8). ACCOUNTING PROCESSES (25%) (a) (b) Principles and practice of double-entry book-keeping: (i) forms and contents of books of accounts (manual and computerized) (ii) books of prime entry, including journals (iii) sales ledger and purchases ledger (iv) cash book and petty cash book (v) general ledger Trial balance: (i) its scope and use (ii) errors and correction of errors (iii) suspense account (c) Capital and revenue items and their treatment in final accounts (d) Accounting treatment of: (i) Fixed assets: - tangible and intangible - depreciation; reasons for and methods of providing for it. - fixed assets register. (ii) Current assets: - stocks; valuation for financial accounting purposes - debtors; bad debts and provision for doubtful debts - cash - bank balances (iii) Liabilities (iv) Provisions and reserves (v) Contingencies 22 4. 5. 6. (e) Control accounts (f) Bank reconciliation statements (g) Value Added Tax (VAT) (h) The use of computer software and packages in the following areas: - sales and purchases ledger - control accounts - payroll - inventory - bank reconciliation PREPARATION OF FINAL ACCOUNTS FOR SOLE ROPRIETORSHIP AND NOT - FOR - PROFIT ORGANISATIONS (15%) (a) Manufacturing, trading, profit and loss accounts, and balance sheet for sole-proprietorship (b) Preparation of income and expenditure account, and balance sheet or statement of affairs) for not-for-profit organization. (c) Preparation of final accounts from incomplete records PARTNERSHIP ACCOUNTS (20%) (a) Formation of partnership (b) Partnership agreement (c) Preparation of final accounts (d) Admission, retirement, removal and death of a partner (e) Change of interest (f) Revaluation of assets and goodwill LIMITED LIABILITY COMPANIES ACCOUNTS (15%) (a) Nature of limited liability companies (b) Raising of capital (c) Statutory books and records (d) Methods of establishing a company (e) (i) Establishment of new business (ii) Conversion of sole proprietorship to limited liability company (iii) Conversion of partnership to limited liability company Issue and redemption of shares or debentures (excluding sinking fund) 23 (f) Preparation of first financial statements highlighting the treatment of pre-and post- incorporation items (g) Final accounts for management use (h) Treatment of dividends and taxation D. CONTACT HOURS 60 E. RECOMMENDED TEXTS Anao, A.R., An Introduction to Financial Accounting, Longman. Asaolu, Ayodele, Modern Book-Keeping and Accounts, Gbabeks Publishers Limited, Ibadan Dodge, R. Foundation of Business Accounting, Chapman & Hall Inanga, E. L. Principles of Accounting, Heinemann Spicer & Pegler, Book-Keeping & Accounts Walgenabach, P. N.,Financial Accounting: An Introduction, Harcourt Brace Jovanovich Welsch, G. A., and Short, D. G., Fundamentals of Financial Accounting, Richard D. Irwin. Wood, F. I., Business Accounting, Pitman 24 21.1.2 PAPER 2: A. QUANTITATIVE ANALYSIS AIM To examine candidates’: B. familiarity with basic concepts and processes in statistics, business mathematics and operational research competence in the collection, collation, manipulation and presentation of statistical data for decision making familiarity with different methods of presenting data designed to enhance understanding ability to employ suitable mathematical models and techniques to solve problems involving rational choice among alternatives LINKAGES This paper is linked to papers 3, 4,10, 12,13, 15, 17, 19. The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and answer questions covering the entire syllabus. SECTION B: (60 Marks) - Six questions out of which candidates are answer four. C. short expected to CONTENTS 1. STATISTICS (40%) (a) Handling statistical data: (i) Methods of collecting statistical data: - Questionnaire/schedule, interview, observation, mailing (ii) Classification of data: by types: (numeric and non numeric) by source (origin): Primary and Secondary by use: agricultural, demographic, health, education, power and energy. (iii) Presentation of data: 25 - (iv) - (c) - charts: bar charts (simple, component, percentage component and multiple), Pie chart, Z chart, Gantt-chart - graphs: histograms, polygon, ogives, lorenz – curve Sampling: - (b) tabular presentation: frequency table and cross tabulation characteristics of a table: title, heading, foot-note, source e.t.c. Purpose of sampling Methods of sampling: simple random sampling, stratified, systematic, quota and multi-stage. Advantages and disadvantages of each. Measures of location: (i) Measures of central tendency mean (arithmetic, geometric and harmonic) other measures: median and mode (ii) Measures of partition: percentiles, deciles and quartiles Measures of variation/spread/dispersion: (i) range, mean deviation, mean absolute deviation, variance and standard deviation (ii) co-efficient of variation (iii) skewness (d) Measures of relationships: (i) Correlation (Linear) - meaning and purpose - scatter diagram - types of correlation: positive, zero and negative (ii) Correlation coefficient: - meaning - types: person product moment correlation, spearman’s rank, correlation coefficient - determination and interpretation of correlation coefficients. (iii) Regression Analysis (Linear): 26 (e) meaning and purpose fitting of regression line by graphical method and normal equation / least squares method interpretation of regression constant and regression coefficient use of regression line in forecasting and its limitations coefficient of determination: meaning and interpretation interpretation Time series analysis: (i) (ii) (iii) (iv) Meaning and purpose of time series Time series plot Basic components: trend, seasonal, cyclical, irregular Methods of estimating components: - (v) trend: graphical, moving averages, least squares and semi averages seasonal indices: average percentage, moving average, link relative, ratio to trends. Use of time series components for forecasting (f) Index Numbers: (i) Meaning and purpose (ii) Problems associated with the construction of index numbers (iii) Unweighted indices: simple aggregate index, price relative (iv) Unweighted indices: Laspeyre , Paasche, Fisher and Marshall Edgeworth (v) Applications of index numbers to business analysis. (g) Probability (i) Concept and meaning: random experiment, sample space, sample point, events e.t.c. (ii) Measurement/determination of simple probability directly sample (iii) Additive law of probability/mutual exclusive events (iv) Multiplication law and conditional probability/independent events (v) Discrete probability distribution and mathematical expectation (vi) Permutation and combination; elementary treatment only (vii) Common probability distribution: Binomial, Poisson and Normal together with their applications in Business. (viii) Approximation of Binomial by Normal, Binomial by Poisson and their applications. 27 (h) Sampling distribution of sample means, and single proportions including their standard errors. (i) Estimation and significance testing: (i) Point estimation: mean, proportion and standard error (ii) Interval Estimation: - confidence interval concept and meaning - confidence interval for single population mean and single population proportions. (j) 2. (iii) Hypothesis: - concept and meaning of hypothesis - types of hypothesis: null hypothesis and alternative hypothesis. (iv) Type I and type II errors: - Significance level (v) Testing of hypothesis about single population mean and single population proportions for small and large samples. Applications of (a) to (i) to data collection, analysis and interpretation in relationship to real life/business situations. BUSINESS MATHEMATICS (25%) (a) Set: (i) (ii) (iii) (iv) (v) (vi) (b) Concept and definition Types of sets: null, subset, finite, infinite universal and equal sets. Cardinality: number of elements in a set and number of all possible sub-sets in a set. Operations: union, intersection, difference and complement. Venn diagram: using Venn diagram in set theory. Applications of set theory to solving business related problems Functions: (i) Definition of function (ii) Types of functions: Linear, quadratic exponential, logarithmic and their evaluation including graphical representation. (iii) Functional equations: Linear, simultaneous, quadratic and their solutions including graphical methods. (iv) Sample linear inequalities invaluable not more than two variables graphical approach (v) Applications involving: - cost, revenue and profit functions - break-even analysis - determination of break-even point in quantity and value. - significance of break-even point 28 (c) Matrix: (i) Arrays of numbers (ii) Meaning of a matrix (iii) Types of matrices: identity, null, square, diagonal, symmetric and skew symmetric, triangular matrix (upper and lower). (iv) Basic operations with matrix: Addition, subtraction, multiplication of matrices and conditions under which these are possible; transpose of a matrix. (v) Meaning of determinant and its evaluation. (vi) Minor, cofactor, matrix of factors and adjoint matrix. (vii) Inverse of a square matrix: Its definition and determination (other methods in addition to adjoint approach may be used. Also, limited to at most 3 by 3 matrix). (viii) Solution of systems of linear equations including Cramer’s rule. (ix) Applications of matrices to solving business related problems. (d) Mathematics of Finance: (i) Sequence and series: - concept and meaning - types: arithmetic progression and its sum; geometric progression and its sum; sum to infinity of a geometric progression. - application in business (ii) Simple and compound Interests: - present value simple amount - present value of compound amount in order to: - determine the consumers’ and producers’ surpluses. - find total functions from marginal functions. (iii) Annuities: - types of annuities: ordinary and annuity due - sum of an ordinary annuity (sinking funds). - present value annuity Net Present Value (NPV) Internal Rate of Return (IRR). (iv) (v) (e) Differentiation: (i) (ii) (iii) (iv) (v) (f) Concept and Meaning: Measures of rate of change as derivative or slope; measure of marginal. Rules for differentiating the following functions: polynonial, product, quotient, function of function, implicit function, exponential and logarithmic functions. Second-order derivative. Application of a differentiation: finding marginals, elasticity, maximum and minimum values. Simple partial differentiation of first order. Integration: 29 (I) (ii) (iii) (iv) 3. As a reverse of differentiation Rules for integrating polynomial and exponential functions. Indefinite, determination of constant of integration and definite integral. Application of integration: determination of consumers’ and produces surpluses. OPERATIONS RESEARCH (35%) (a) Introduction to operational research (I) Concept and meaning (ii) Main stages of operational research (OR) project (iii) Relevance of operational research in business (b) Decision theory: (i) Types of decision situation: - certainty, uncertainty and risk. (ii) (iii) (iv) Elements of decision: - Under certainty: state of nature and outcome - Under uncertainty: state of nature, event that happened after, outcome and risk. Techniques of decision theory - Techniques used for uncertainty: minimax, maxmin, maxmin regret criterion. - Techniques used for risk: expected monetary value (with perfect and imperfect information) Cost of perfect information (c) Linear Programming (i) Concept and meaning (as a resource allocation tool). (ii) Underlying basic assumptions. (iii) Problem formulation in linear programming. (iv) Methods of solution - graphical methods (for 2 decision variables) - simplex method (limited to three decision variables) (v) Interpretation of results: - results from final tableau. - results from simplex method, shadow price, marginal value worth of resources. - determination of dual/shadow costs. (d) Inventory and production control: (i) Meaning of an inventory (ii) Functions of inventory (iii) Inventory costs: holding costs, ordering costs, shortage costs, cost of materials. (iv) General inventory models: deterministic and stochastic models; periodic review system and re-order level system. (v) Basic Economic Order Quantity (EOQ) for deterministic 30 (vi) model: - assumptions of the model - shortage and non-shortage allowed. Applications of EOQ to Business. (e) Network analysis (i) Concept and meaning (ii) Network diagram (iii) Concept of the following terms: - floats, slack, earliest time, latest time e.t.c. (v) Methods of network analysis - critical path method (CPM): using floats and without using floats; meaning of critical path and how to determine it. - programme evaluation and review technique (PERT) (f) Replacement analysis: (i) Meaning and purpose (ii) Replacement of items that wear gradually. (iii) Replacement of items that fail suddenly. (g) Transportation Model: (i) Nature of transportation models . (ii) As special linear programming problems. (iii) Concept of balanced and unbalanced transportation problems. (iv) Methods for solving transportation problems: Northwest Corner rule, least cost, Vogel’s approximation method. (v) Test for optimality of the solution stepping stone method. (vi) Solving assignment problem as a special transportation model. (h) Queuing Model: (i) Definition of a queue. (ii) Classes of queues. (iii) Simple queues and its characteristics; simple queue formulae. (iv) Applications of queueing model in business. (i) Markov Process: - definition of Markov process - meaning of transition matrix - formulation of transition matrix - equilibrum or long run situations for Markov process. (j) Simulation (i) Concept and meaning (ii) Types / approaches - Monte Carlo - computer approach: To know how to use some packages on simulation. 31 D. CONTACT HOURS 90 E. RECOMMENDED TEXTBOOKS Adamu, S.O. and Johnson, T.L., Statistics for Beginners, Evans, Nigeria. Inanga, E.L. and Osayimwese, I., Mathematics for Business, Onibonoje Press Lapin, L. L., Quantitative Methods for Business Decisions, Harcourt Brace Jovanovich Levin, R. I., et al, Quantitative Approaches to Management, McGraw Hill Lucey, T., Quantitative Techniques: An Instructional Manual, DPP Publications Ltd. Marsland, M.W., Quantitative Techniques for Business, Polytechnic Sasieni, M. et al, Operational Research – Methods and Problems, New York Wiley Soyibo, A. and Adekanye, F., Linear Programming for Business and Finance, F. & A. Publishers Ltd. Thrikettle, G. L., Wheldon, Business Statistics and Statistical Methods, ELBS/MacDonald and Evans. 32 21.1.3 PAPER 3: ECONOMICS AIM To examine candidates’: B. knowledge of economic concepts , principles and the dynamic forces which underline rational choice and behaviour understanding the features of the Nigerian environment in which individuals, firms, government and other economic units operate knowledge of the nature of Nigerian economic relations with other countries, institutions and regional bodies. LINKAGES Economics forms the basis of understanding of other subjects in the entire syllabus and is consequently linked to all of them. The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Six questions out of which candidates are expected to answer four. C. CONTENTS 1. ECONOMICS AND SOCIETY (5%) (a) (b) 2. (c) (d) Economics and its scope The concepts of scarcity, choice, scale of preference and opportunity cost Nature of the economic problem The concept of an Economy, that is (i) Free Market Economy (ii) Centrally Controlled Economic/Command Economy (iii) Mixed Economy (e) Distinction between Microeconomics and Macroeconomics THEORY OF VALUE (10%) (a) (b) (c) (d) (e) The concepts of demand and supply. Interrelation between demand and supply Factors affecting demand and supply Distinction between movement along a demand/supply curve and shifts in demand/supply curves Exceptions to the laws of demand and supply Price elasticity of demand and supply 33 (f) (g) (h) 3. THEORY OF CONSUMER CHOICE/BEHAVIOUR (5%) (a) (b) (c) (d) 4. Income and cross elasticity of demand and supply Factors affecting elasticity of demand The concept of equilibrium The Marginal Utility Theory The Indifference Curve Theory Adjustment to Income and Price Changes (Income and Substitution Effects) Consumer surplus THEORY OF PRODUCTION (10%) (a) (b) (c) (d) (e) (f) (g) Concept of production and cost The factors of production: land, labour, capital and entrepreneur Average product and marginal product of a factor input The short run and the long run in production analysis Production possibility frontier The law of diminishing returns Constant returns to scale, increasing returns to scale, decreasing returns to scale (h) Returns to factors: wages, rent, interests and profits (i) Economic rent, quasi rent (j) Total cost, total fixed cost, total variable cost, average cost, average variable cost, average fixed cost, including graphical representation. (k) The concepts of total revenue, average revenue and marginal revenue in production analysis. 5. MARKET STRUCTURES (10%) (a) The concept of market (b) Price and output determination under conditions of perfect competition, monopoly, monopolistic competition, monopsony, oligopoly and duopoly (c) Price differentiation and price discrimination (d) The conditions favourable for price discrimination (e) The economic justifications for price discrimination (f) Monopoly power and how it can be controlled (g) Mergers and acquisitions, and their advantages and disadvantages 6. INDUSTRY LOCATION (5%) (a) (b) (c) (d) (e) 7. Definition of industry Location and localization of industry Factors that influence location of industry with appropriate examples from the Nigerian environment Advantages and disadvantages of industrial concentration Small firms and large firms and their advantages and disadvantages MONEY AND BANKING (10%) 34 (a) The nature and function of money and credit (b) The demand for and supply of money (c) The functions of the Central Bank, Commercial Banks, Merchant Banks Development Banks, Insurance Companies and other financial institutions with reference to the Nigerian economy (d) The money and capital markets and the roles of the Nigerian Stock Exchange (NSE) and the Securities and Exchange Commission (SEC) (e) 8. ELEMENTS OF PUBLIC FINANCE (10%) (a) (b) (c) (d) (e) (f) (g) 9. The concept of public finance The role of government budget in the economy Sources of government revenue and the target of government expenditures Deficit spending and budgetary surplus and their effects on the economy Forms and principles of taxation The effect of taxation on prices, investment decisions and expected rates of returns in the economy Externalities - Divergences between Private and social costs and benefits INFLATION AND UNEMPLOYMENT(5%) (a) (b) (c) (d) (e) 10. Government monetary and fiscal policies Causes of Inflation Types of Inflation Inflation in Developed versus Developing Countries Control of Inflation Unemployment (i) Kinds of unemployment (ii) The measurement of unemployment (iii) Cures for unemployment NATIONAL INCOME (10%) (a) Definition of national income (b) The income, output and expenditure methods of computing national income (c) Problems of computing national income (d) The use of national income accounting (e) The concepts of consumptions, savings and investments in a Keynesian macro-economic setting (f) Factors that affect consumption, savings and investments (g) The concept of the multiplier and the accelerator 11. INTERNATIONAL TRADE (10%) 35 (a) (b) (c) (d) (e) (f) (g) (h) (i) 12. Internal and international trade The theory of comparative advantage as a basis of trade between countries The advantages and disadvantages of international trade Terms of trade and balance of payment Foreign exchange, exchange rates, their nature, functions, determination and the foreign exchange markets Currency devaluation and currency depreciation The case for and against protectionism The concept and forms of economic integration The activities of international institutions like IMF, IBRD, GATT/WTO UNCTAD, ECOWAS, OPEC, ECA, EC. ECONOMIC DEVELOPMENT AND GROWTH (10%) (a) (b) Theories of economic development and growth Nature and scope of government intervention in the development process (c) Role of the private sector in the development process (d) Role of international institutions in the development process D. CONTACT HOURS: 60 E. RECOMMENDED TEXTBOOKS Adebayo A. (1998), Economics: A Simplified Approach Volumes 1 & 2, African International Publishing Ltd., Lagos Lipsey,R.G.and Steiner, P.O., Economics, Harper & Row. Nwankwo G.O., Basic Economics for West African Students, CUP Ojo J.A.T. and Adewunmi, O., Banking and Finance in Nigeria, Graham Burn. Olaloku F.A. et al , Structure of the Nigerian Economy, McGraw-Hill. Truett, L.J. and Truet D.B., Economics, Times Mirror & Mosby College Publishing Umo J. U. (1986), Economics: An African Perspective, John West 21.2 INTERMEDIATE 21.2.1 PAPER 4 COST ACCOUNTING 36 A. AIM To examine candidates’: B. mastery of the concepts and principles of costing and its use in control decisions in business and other activities ability to use information and communication technology in dealing with cost accounting problems and in preparation of reports ability to analyse and predict cost behaviour as output and market factors vary and the impact on profit ability to apply appropriate methods and techniques in collecting, measuring and reporting cost information relevant to business and other activities understanding the principles and procedures involved in budgeting and budgetary control and their application. LINKAGES This paper is linked to papers 1, 2, 4, 5, 11, 13, 14, 15, & 18. The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Answer questions one and any other three questions. C. CONTENTS 1. INTRODUCTION TO COST ACCOUNTING (15%) (a) Definition and purpose of cost accounting (b) Classification of cost by functions, elements, responsibility, definition and behaviour (c) Materials accounting and control procedures including (i) Stock recording and Inventory control (ii) Procurement and pricing (iii) Methods of inventory valuation (iv) Just-In-Time purchasing and production (d) Labour accounting and control procedures including (i) (ii) (iii) Basic methods of remuneration General features of incentive schemes Labour costing and labour cost control 37 (iv) 2. (e) Overhead Cost Accounting and control procedures including (i) Overhead classification and analysis (ii) Activity based Costing (f) Cost centre (i) Selection and attributable costs (ii) Product and department costs (g) Cost behaviour and cost estimation COSTING METHODS (10%) (a) (b) (c) (d) 3. Operation costing Specific order costing; Job, batch, uniform and contract costing including work-in-progress Process costing including principles of equivalent units, treatment of normal and abnormal losses and gains, joint products and byproducts and wastes Service costing STANDARD COSTING TECHNIQUES(15%) (a) (b) (c) 4. Impact on labour cost of; job evaluation, merit rating, labour turnover Types and bases of setting standards such as basic, current, ideal and normal standards. Methods of determining standard cost and the uses of standard cost. Variance analyses OTHER COSTING TECHNIQUES(10%) (a) Absorption costing (i) Allocation and apportionment of overheads (ii) Reciprocal services (iii) Absorption of overheads (iv) Absorption costing methods (b) Marginal costing (i) Uses of marginal costing in decision making such as production planning, pricing, make or buy, close-down, accept or reject, dropping a production line, accepting additional order. (ii) Types of break-even charts. (iii) Methods of calculating break-even point, margin of safety and ascertainment of angle of incidence, profit volume ratio 5. BUDGETING AND BUDGETARY CONTROL (15%) 38 (a) Forecasting problems and techniques (b) Budgeting process and organisation (c) Preparation of functional budgets, types of budgets such as fixed and flexible budgets, cash budget and master budget (d) Behavioural aspects of budgetary control (e) Preparation and reconciliation of budgeted and actual results 6. COST CONTROL (10%) Cost control and reduction techniques such as: (a) value analysis (b) work study (c) method study (d) quality control techniques (e) merit rating (f) job evaluation (g) work measurement and cost audit. 7. INTEGRATED ACCOUNTS (10%) (a) (b) (c) 8. Book-keeping entries for costing systems, integrated and interlocking systems Reconciliation of financial and cost accounting profits Chart of accounts and computerisation of costing records DEVELOPMENTS IN COST ACCOUNTING (5%) Innovation in cost accounting including (a) (b) (c) 9. D. back flush accounting life cycle costing target costing and Advanced Manufacturing Technique (AMT). CASE STUDY (10%) CONTACT HOURS 60 HOURS 39 E. RECOMMENDED TEXTBOOKS Baggot J., Cost and Management Accounting Made Simple, London W.H. Allen Biggs, W. W., Cost Accounts, Macdonarld and Evans Dopuch, M. and Bimberg, J. C., Cost Accounting: Accounting, Data for Management Decisions, Harcourt Brace Johanovich Buyers, C. J., and Holmes, G. A., Principles of Cost Accountancy, Donnington Press Horngren, C. T., Cost Accounting - A Managerial Emphasis, Prentice - Hall Lucey, T., Costing, ELBS Texts Omolehinwa, E. Coping with Cost Accounting, Pumark Publishing Ltd. Wheldon, H. J., H. J., Owier, L.W.J. and Brown, Cost Accounting and Costing Methods, Macdonarld and Evans Wintoki, M. B., Cost Accounting: A Study Guide for Students, M. B. Consultants Publications 40 21.2.2 PAPER 5: A. GENERAL PRINCIPLES OF LAW AIM To examine candidates’: B. understanding of the nature and objectives of legal rules that are essential to the functions and duties of an accountant familiarity with the basic features of the Nigerian Legal System and Constitution familiarity with the laws relating to various commercial transactions and the relationships pertaining thereto. LINKAGES This paper is linked to papers 1, 6, 8,10, 11,14,17, & 19. The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Six questions out of which candidates are expected to answer four. C. CONTENTS 1. THE NIGERIAN LEGAL SYSTEM (30%) (a) (i) (ii) 2. The sources of Nigerian Law - common law, doctrines of equity, statutes, customs, international law and treaties. judicial precedents, the hierarchy of courts and administration of justice - the Supreme Court, Court of Appeal, Federal High Court, High Court of a State, Magistrate Courts, Customary and Sharia Courts of Appeal, Area Courts and District Courts, National Industrial Court, Industrial Arbitration Panels and Tribunals. (b) The Constitution - supremacy, fundamental rights, separation of powers, legislative lists, power and control over public funds. (c) The essential elements of the tort of negligence and the liability of professionals for negligent advice, the principle of vicarious liability, the distinction between civil and criminal liability. LAW OF CONTRACT (35%) 41 Nature of contract law in relation to local and international businesses, essentials of a valid contract (offer, acceptance, consideration, intention to create legal relations), capacity to contract, privity of contract, fundamental terms, contract in restraint of trade, exclusion clauses, mistakes, misrepresentation, duress, undue influence, illegality, breach of contract and remedies for breach of contract such as damages and specific performance, standard form contract. 3. THE LAW OF COMMERCIAL TRANSACTIONS (35%) (a) Commercial Agency:- Its creation, effects of agent’s acts, duties of principal and agent, remedies for breach of duties, termination of agency. (b) Sale of Goods:- Obligations of the seller and buyer, conditions and warranties, transfer of property, remedies of seller and buyer. (c) Hire purchase and instalment credit transactions:- Nature of hire purchase contract, distinction between hire purchase and instalment credits, rights and obligations of parties, Hire Purchase Act, 1990. (d) Land Use Act, 1978:- Rights of occupancy as security for bankers’ advances, the nature of Governor’s consent to alienation of interest in land. (e) Secured Credit Transactions:- Mortgages, suretyship, guarantee, indemnity, pledge and lien. NOTE: STUDENTS WILL BE EXPECTED TO HAVE KNOWLEDGE OF ALL AMENDMENTS TO DATE, OF ALL THE LEGISLATIONS IN THIS SYLLABUS D. E. CONTACT HOURS 60 RECOMMENDED TEXTBOOKS Asomugha, E., Company Law in Nigeria Under the Companies and Allied Matters Act, 1990, Tome Micro Publishers Limited, Lagos. Bigg, W.W. and Thompson, Ranking, Spicer and Pegler’s Mercantile Law, HFL ( Publishers) Limited, London. Chorley, Lord and Giles, O.C., Slater’s Mercantile Law, Pitman, London. Ezejiofor, G., Okonkwo C., and Ilegbue, C. U. Nigerian Business Law, Sweet and Maxwell, London. Hicks, Andrew, Nigerian Law of Hire Purchase, Ahmadu Bello University, Zaria. “Insurance Law in Nigeria” 42 Obilade, A. O., The Nigerian Legal System, Sweet and Maxwell. Omojola, F., General Principles of Business Law in Nigeria. Sagay., I. E., Nigerian Law of Contract, Sweet and Maxwell. Sofowora, M. O., Introduction to Nigerian Legal System and Basic Principles of Contract Part 1, Soft Associates, Lagos. 43 21.2.3 PAPER 6: PRINCIPLES AND PRACTICE OF AUDITING A. AIM To examine candidates’: B. familiarity with, and knowledge of the basic objectives, principles and concepts of auditing understanding of the risks, methods, techniques and processes of auditing, including planning and control ability to audit computerised accounting systems ability to communicate effectively with management and internal auditors, audit committees, shareholders, regulatory agencies and specialists understanding of the regulatory and ethical considerations governing assurance engagements, and ability to identify the requirements of the audits of various organisations. LINKAGES This paper is linked to papers 1, 3, 4, 5, 8, 9, 11, 14, 15, 12, 16 & 19 The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and answer questions covering the entire syllabus. short SECTION B: (60 Marks) - Six questions out of which candidates are expected to answer four. C. CONTENTS 1. FUNDAMENTALS AND PRINCIPLES OF AUDIT (10%) (a) (b) (c) (d) Development and objectives of audit Auditing techniques: and their limitations, audit evidence and documentation Independence, objectivity, integrity, confidentiality, skill, care and competence True and fair view, materiality and judgement. 2. REGULATORY AND ETHICAL ISSUES (15%) 44 (a) (b) (c) (d) 3. INTERNAL AUDIT AND CONTROL (15%) (a) (b) (c) 4. (b) (c) (d) (e) (f) (g) (h) Reviewing the client’s operational background with regard to its financial, legal and personnel situations and the industry environment in which it operates Allocation and supervision of work and responsibilities. Designing the audit programme Examining the impact of relevant legislations on the performance of an audit Evaluating the quality of the audit and maintaining adequate working papers Planning, documenting and monitoring of time and costs Establishing procedures for obtaining audit evidence including balance and transaction testings, analytical procedures and management representation Quality control and peer review. VERIFICATION OF ASSETS AND LIABILITIES (10%) (a) (b) (c) 6. Scope and purpose of internal audit Reviewing the relationship between external and internal audits Internal Control Systems. AUDIT PLANNING AND CONTROL PROCEDURE(15%) (a) 5. Scope and terms of engagement of auditors as provided in. (i) Companies and Allied Matters Act 1990 (ii) Banks and Other Financial Institutions Act 25 of 1991 (iii) Insurance Act of 2003 Candidates to be familiar with instruments establishing various organisations such as SEC, NDIC etc Professional pronouncements and their applications i.e. guidelines and standards of the Institute and other international bodies. Supervision and monitoring of auditors: (i) Quality control, working papers, peer review. (ii) Functions and responsibility (iii) Threat to auditors’ independence and their resolutions: (iv) conflicts of interest, beneficial shareholding, financial involvement with or in the affairs of clients, personal relationships, audit fee etc. Verification principles Verification of current assets, fixed assets and liabilities Verification of intangible assets, goodwill, patents, trademarks, copyrights, franchise. APPLICATION OF INFORMATION TECHNOLOGY IN AUDITING (15%) 45 (a) (b) (c) 7. INTRODUCTION TO PUBLIC SECTOR AUDIT (5%) (a) (b) (c) (d) 8. Understanding the impact of Information Technology in auditing environment Using Computer Assisted Auditing Techniques (CAATs) and testing Information Technology Systems controls Responsibility of auditors as regards Information Technology security and Computer related crimes in an organisation. Appointment, power and functions of the Auditor-General of the Federation, State and Local Government, Auditing for compliance with legislative and related authorities Role of Public Accounts Committee in the Audit process Internal audit in the public sector. ASSURANCE REPORTING (15%) (a) (b) (c) Audit report: statutory and non-statutory, qualified and unqualified Reviewing subsequent events, going concern status, management representation and the truth and fairness of financial statements Relationship of auditors with audit committees and third parties. D. CONTACT HOURS: 60 E. RECOMMENDED TEXTS: Adewunmi, Wole, Bank Audit, University of Lagos Press. Aguolu Osita, Fundamentals of Auditing, Rex Charles & Patrick Ltd., Nimo, Anambra State, Nigeria, 1998. Arens, A.A. and Loebbecke J.K., Auditing: An Integrated Approach, Prentice Hall. Chambers, A.D. et al Internal Auditing: Theory and Practice, Pitman. Coopers & Lybrand, Manual of Auditing, Gee & Co. Dodge, R., Concise Guide to Auditing Standards and Guidelines, Chapman & Hall. Dunn, J., Auditing: Theory and Practice, Prentice Hall Fakiyesi Sanmi, Essentials of Auditing Fint, D., Philosophy and Principles of Auditing, Macmillan. INSTITUTE OF CHARTERED ACCOUNTANTS OF NIGERIA Professional Code of Conduct 46 Johnson, A.A., An Introduction to Business Data Processing and Computer Audit, City Publications Ltd., Lagos. Okolo, J.U.T., The Concept and Practice of Auditing, Evans (Nig.) Ibadan. U.K. National Audit Office, A Public Audit Manual I & II National Audit Office. Washbrook, N., Management Control, Auditing and the Computer, Heinemann. Willingham, J.J. and Carmichael, D.R., Auditing Concepts and Methods, McGraw-Hill. 47 21.2.4 PAPER 7: A. MANAGEMENT AIM To examine candidates’: B. understanding of management concepts, theories and techniques and their relevance in contemporary business world ability to apply the concepts, theories and techniques in the analysis and development of solutions to management problems especially those frequently encountered in the global economy ability to utilize management skills in developing corporate and strategic goals for an organization in a dynamic environment ability to analyse the impact of changes in the environment on policy decisions of management understanding of the principles and practices of organic business functions ability to analyse and provide solutions to simple management cases. LINKAGES Management is a foundation course for the other subjects and is therefore linked to all of them. The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Answer questions one and any other three questions. C. CONTENTS 1. MANAGEMENT CONCEPTS AND THEORIES (15%) (a) (b) (c) (d) (e) Nature and Purpose of Management - Definitions Art and Science of Management; Management levels, skills and roles Process of Management - Planning, organizing, staffing, leading and controlling Managerial and organizational performance - Efficiency and effectiveness Domain of Business - Production, Marketing, Finance and Human Resources Management 48 (f) (g) 2. Evolution of Management Thought - Pre-classical contribution; classical school - Scientific Management, Fayol’s Principles of Management, Max Webbers’ theory of bureaucracy; and neo-classical school - human relations school. Modern Theories - systems and contingency theories; the interrelationships between the schools of thought. ENVIRONMENT OF MANAGEMENT (10%) (a) (b) (c) (d) Nature and role of environment of management Types; internal, external and global environments. Analysis of environmental factors - Ecological, economic, social, technological, political, legal and cultural factors. Globalisation and its impact on managements; Environmental scanning. Business ethics and social responsibility; perspectives of ethics and social responsibility; monitoring social demands and expectations; changing concept of social responsibility. 3. MANAGEMENT TECHNIQUES (10%) (a) Management by Objectives (b) Stress Management (c) Time Management (d) Forecasting techniques (e) Decision tree (f) Budgetary control techniques (g) Program evaluation and review technique (PERT) (h) Break-even analysis (i) Total quality management (j) Just-in-time inventory control 4. MANAGING WORK AND ORGANISATION (15%) (a) (b) (c) (d) (e) Planning - Types, approaches, benefits, and processes constraints to effective planning. Organising - the concept of organisation, nature and purposes, organisation structure, design and effectiveness; formal and informal organisation Patterns of departmentalisation; by function, product, geography, customer, process, time, matrix organization, choice of pattern of departmentalisation; line and staff authority; centralization and decentralisation; delegation of authority; span of control. The determinants of organisational structure - strategy, size, technology and environment; the impact of structure on organizational performance. The need for and techniques of co-ordination, managerial hierarchy, roles, procedures, plans and goals. Decision making - Types, programmed/non-programmed; Decision making under certainty, risk and uncertainty; rational decision making model and its limitations; management by objectives. 49 (f) 5. Controlling - the nature and purpose of control; control process. Key performance areas; control techniques; characteristics of effective control system. ORGANIC BUSINESS FUNCTIONS (15%) (a) Managing People in Organisation (i) - Characteristics of Effective Communication System Staffing - Manpower planning; job analysis, job description. Job specification; recruitment; selection and placements. training and development, performance appraisal compensation and welfare services. discipline, promotion and separation. Nature of industrial relations - collective bargaining, legal framework and dispute settlement. (ii) Motivation - Roles of motivation; theories of motivation, content, process and reinforcement theories, Implication of motivation theories for management. (iii) Leadership - The nature and role of leadership in organisations; leadership styles and effectiveness; approaches to leadership; managerial grid. (iv) Communication - Definition, types, channels and process of communication, importance of effective communication; barriers to effective communication. Characteristics of effective communication (b) Production Functions – the scope of production management; production planning and control; scheduling; facility location and layouts; productivity and productivity improvement schemes. Material requirements planning and purchasing; inventory control and quality assurance. (c) 6. Marketing functions - Nature of marketing; marketing concepts; marketing functions; market segmentation; marketing research; elements of consumer behaviour, marketing mix – product; pricing; distribution and promotion strategies. Sales forecasting, planning and budgeting. CORPORATE PLANNING AND STRATEGY (10%) (a) the nature and role of strategic planning; strategic planning process; determination of enterprise vision, mission, goals and objectives and SWOT analysis. (b) the concept of strategy, global, corporate, business and functional level strategies, SWOT analysis; business growth strategies; strategy formulation, implementation and evaluation. (c) the nature and functions of management information system (MIS) in corporate planning and strategy. 50 7. 8. MANAGING CHANGE (10%) (a) Sources of conflicts and conflict management. (b) Nature of change and innovation, forces driving change and innovations; change and innovation process. (c) Entrepreneurship and intrapreneurship. (d) Organisation culture. (e) Planned change and organisational development, resistance to change; overcoming resistance to change. INTRODUCTION TO CORPORATE GOVERNANCE (5%) Statutory and functional roles and responsibility of Board of Directors and top management, liabilities of directors, shareholders’ rights and control over the affairs of the company. 9. CASE STUDY (10%) D. CONTACT HOURS 90 E. RECOMMENDED TEXTBOOKS Adeleke, A. A. Management Concepts and Applications, Lagos concept publications Adewunmi Wole Management: An Introduction, Ibadan, Macmillian Publishing Company Bertol, K. M. and Martins, D. V. Management New York McGraw-Hill Cole, G.A. Strategic Management: Initiative Growth, London. Inegbenebor A. U. and Osaze E. B. Introduction to Business, Lagos Malthouse Press Limited Lawal, A. A. Management in Focus, Lagos, Abdul Industrial Enterprises. Stoner, A. F., Freeman R. E, and Gilbert, D. R. Management, New Dehli Prentice-Hall Incorporated Weihrich, H. and Koontz H. (1994) Management: A Global Perspective, New York Mc GrooHill locotion 51 JOURNALS ASCON Journal of Management: Nigeria (ASCON), Badagry. Published by Administrative Staff College of Management in Nigeria: Published by the Nigerian Institute of Management, Lagos Nigerian Management Review Development (CMD), Lagos. Published 52 by the Centre for Management 21.3 PROFESSIONAL EXAMINATION I 21.3.1 PAPER 8 A. FINANCIAL ACCOUNTING I AIM To examine candidates’: ability to prepare, analyse, interpret and report on financial statements understanding of the theoretical and regulatory framework of financial accounting acquisition of knowledge of financial accounting procedures and practices as they relate to the measurement of income, capital and economic relationship in a variety of business situations and activities ability to design and install financial accounting systems for a variety of business activities ability to prepare financial statements for various types of business organisations for management use and publication knowledge of the application of computer software to ledger and other accounting operations. B. LINKAGES This paper is linked to papers 1, 3, 4, 5, 6, 9, 11, 12, 13, 16, 17, 18 & 19 The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Six questions out of which candidates are expected to answer four. C. CONTENTS 53 1. PARTNERSHIP ACCOUNTS (15%) (a) Amalgamation and absorption (b) Dissolution, including piece-meal realisation and distribution (c) Conversion to limited liability company. 2. COMPANY REPORTS AND ACCOUNTS (a) (25%) Meaning, contents and objectives. (b) Preparation of published financial statements for limited liability companies including banks and insurance companies. (c) Computation and interpretation of significant ratios from financial statements including their usefulness and limitation. (d) 3. Simple report writing. MISCELLANEOUS ACCOUNTS (15%) (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) 4. ACCOUNTING FOR SPECIALISED BUSINESSES (15%) (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) (m) (n) (o) 5. Joint venture Consignment Containers accounts Royalties Branch (including foreign branches) Bill of exchange Departmental account Sinking fund and annuities Insurance claims Contract account Trustees Estate agencies Farmers Investments Leasing Hire purchase Oil and gas Pension and provident fund Property companies Solicitors Underwriters Unit trusts Shipping Stock brokerage Co-operative Societies REGULATORY AND STATUTORY FRAMEWORK (15%) 54 6. (a) Nigerian Accounting Standards Board-role, structure and leading to the issuance of standards. (b) Detailed contents and application of standards (both local and international) (c) Comparison of local and international standards - SAS, IAS. (d) Arguments for and against regulations. (e) Generally Accepted Accounting Principles (GAAP) ( f) Legislative and quasi-legislative requirements, Companies and Allied Matters Act 1990, Insurance Act 2003, Banks and Other Financial Institutions Act 1991, NAICOM Act 2003, Prudential Guidelines, Stock Exchange regulation and Securities and Exchange Commission guidelines and disclosure requirements. COMPUTER APPLICATIONS (15%) (a) Introduction to computer systems and information processing (i) concept of data processing (ii) computer system – Hardware & Software (iii) computer networking (iv) organisational structure of a computer department (v) files and database structure (b) The use of computer software packages in the following areas: D. (i) general ledger and subsidiary ledger. (ii) preparation of trial balance and final accounts. (iii) payroll (iv) inventory (v) fixed assets (vi) treasury (vii) computation of ratios CONTACT HOURS 90 55 processes E. RECOMMENDED TEXTBOOKS Adewunmi,’Wole and Akinlade, T., Data Processing and Management Information Systems, Macmillan/The Chartered Institute of Bankers of Nigeria. Alexander, D., Financial Reporting: The Theoretical and Regulatory Framework, Chapman and Hall. Anao, A.R., An Introduction to Financial Accounting, Longman. Asaolu, Ayodele, Modern Publishers Limited, Ibadan. Book-Keeping and Accounts, Gbabeks BPP, Financial Accounting I, BPP Limited. CIMA, Management Information Systems and the Computer (Parts I & II), CIMA. Dodge, R. Foundation of Business Accounting, Chapman and Hall. Elliot, B. and Elliot, J., Financial Accounting and Reporting, Prentice Hall. Folorunsho, J.O., Practical Approach to Computing, Macmillan. Inanga, E.L., Principles of Accounting, Heinemann Books Nig. Ltd. Jennings, A.R., Financial Accounting Manual 1 and 2, DPP Publications. Shave, M.J., Computer Science Applied to Business Systems, Addison – Wesky. Spicer & Pegler, Book Keeping & Accounts Walgenbach, P.N., et al, Financial Accounting: An introduction, Harcourt Brace Jovanovich. Watson, Computer for Business – A Managerial Emphasis Welsch, G.A. and Short, D.G., Fundamentals of Financial Accounting, Irwin. 56 PAPER 9 TAXATION 21.3.2 A. AIM To examine candidates’: Knowledge of the provisions of statutes in taxation and their interpretations Ability to compute tax liabilities based on relevant statutes Knowledge of ethical issues – implications of confidentiality, conflict of interest and disclosure of information in tax practice B. LINKAGES This paper is linked to papers 1, 3, 5, 8, 6, 7, 11, 12 14, 15, 16, 17, 18 & 19 The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Answer questions one and any other three questions. C. CONTENTS 1. GENERAL SYSTEM OF TAX AND TAX ADMINISTRATION (20%) (a) Definition, nature and objectives of taxation (b) Distinction between taxes and other levies (c) Historical background and the structure of Nigerian tax system (d) Sources of various tax laws (e) Jurisdiction including rules of residence as applicable to individuals, families, estates, executors and itinerant workers (f) General guidelines and practical procedures for registration of tax payers (g) Knowledge of the relevant documents necessary for filing returns for various taxes and relevant tax authorities (h) Returns, assessment procedures and collection of taxes, interests on overdue tax. (i) Objections, appeals and enforcement (j) Multiplicity of taxes: - Act No. 21 of 1998 and conflict between it and the1999 Constitution (k) Tax administration (i) Organs of administration. (ii) Tax Clearance Certificates – nature, objective, relevance and problems 2. INDIVIDUAL ASSESSMENT, TRUST SETTLEMENTS AND ESTATES 57 (40%) (a) General familiarity with the relevant laws and practice, income chargeable and exemptions (b) The employee: (i) definition of employee and legal meaning of income (ii) salaries, pensions, charge, annuities, fees, gratuities, allowances and benefits-in-kind (iii) allowable and disallowable expenses and related case laws (iv) assessments and collection of taxes (v) income tax under Pay-As-You-Earn system (vi) partners in partnership and joint ventures (c) Sole traders: (i) (ii) (iii) (iv) (v) (vi) (d) meaning of a trade or profession adjustment of profits of a trade or profession basis periods including opening and closing years change of accounting dates treatment of business losses – types of relief and their treatment, losses of new trade or business in opening and closing years nature and objectives of capital allowances and reliefs available - Computation of allowances - Relevance of capital allowances to the economy Treatment of Unearned income (i) (ii) (iii) (iv) income from rent on property, including contractor-financed projects income from savings dividends and interests Assessments and payments (e) Taxation of non-resident individuals deriving income from Nigeria. 3. TAXATION OF INCORPORATED COMPANIES (30%) (a) Company income tax: (i) (ii) (iii) (iv) (v) (vi) Adjustments of profits Claims for loss relief and computation of Assessable Profits Claims for capital allowances and computation of total profits. Franked investment income. Computation of tax liability. Assessment and payment of income taxes including minimum tax provisions. (vii) Special considerations: - Turnover tax. - Small company relief. - Specialized businesses including, real estate, agriculture, transportation and telecommunication 58 (b) (c) (d) 4. Education Tax: (i) Objectives and basis of computation (ii) Education tax fund management Withholding Tax - relevant tax authority - income subject to withholding tax - time and mode of claims - refunds; grounds and procedures - remittance to tax authorities Preparation of taxation accounts VALUE ADDED TAX AND STAMP DUTIES (10%) (a) Value Added Tax (i) Definition, nature, objectives and administration (ii) Taxable persons and taxable supplies and services (iii) Input and output (iv) Exempt, zero standard related supplies and services (v) Partial exemptions. (vi) Returns. (vi) Preparation of VAT Accounts. (b) Stamp Duties (i) Definition, nature and objectives. (ii) Forms of stamp duties and computations. (iii) Administration - territorial limits, methods of stamping. (iv) Adjudication - limits and appeals. (v) Transactions attracting stamp duties. NOTE: STUDENTS WILL BE EXPECTED TO BE FAMILIAR WITH ALL RELEVANT DECIDED CASES AS WELL AS OFFENCES, PENALTIES AND ENFORCEMENT PROVISIONS OF TAX LEGISLATIONS. 59 D. CONTACT HOURS: 60 E. RECOMMENDED TEXTBOOKS: Adesola, S. M. Income Tax Law and Administration in Nigeria, Obafemi Awolowo University Press. Afe, Ogundele, Element of Nigerian Taxation Afe, Ogundele, Value Added Tax Ariwodola, J. A., Personal Taxation in Nigeria, J. A. A. Nigeria Limited. 4th Edition. Ariwodola, J. A., Companies Taxation in Nigeria, J. A. A. Nigeria Limited. 3rd Edition. CITN, Nigerian Tax Laws Naiyeju, J. K., Value Added Tax Ola, C. S., Nigerian Income Tax in Practice, C. S. S. Ltd. Lagos 60 21.3.3 PAPER 10 MANAGEMENT INFORMATION SYSTEM AIM To examine candidates’: appreciation of the capabilities, limitations and applications of computers in industry and commerce understanding of information technology and ability to apply systems techniques to the resolution of organisational problems appreciation of systems development methodologies; identifying the tools and techniques involved working knowledge of systems evaluation and implementation demonstrable capability to collaborate effectively with computer specialists in defining and installing the appropriate management information systems to meet the information needs of their organizations appreciation of the need and requirement for the security of systems data, control and contingency planning ability to identify various areas of computer related crimes and how to prevent the occurrence understanding of information technology taking cognisance of emerging business models including the Internet and its impact on communications and commerce. B. LINKAGES This paper is linked to papers 2, 3, 4, 6, 12, 13, 14, 16, 17 and 19 The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Answer questions one and any other three questions. C. CONTENTS 61 1. 2. INTRODUCTION TO MANAGEMENT INFORMATION SYSTEM (5%) (a) Uses of MIS in an organisation; relationship between data and information (b) Formulation of an organisation’s MIS strategy (c) IT and MIS SYSTEMS CONCEPT OF ORGANISATION (a) Introduction (i) (ii) (iii) 4. general Systems Theory (definition, component and behaviour) classification of information systems coupling and decoupling (b) Organisation of systems: such as financial, marketing, human resources or personnel, manufacturing/production, enterprise resource planning, customer relationship management. (c) Different types of organizational structures and systems used for operational, tactical and strategic planning and control. (i) (ii) 3. (10%) independence of data structures from organizational structures role and structure of management information systems, data processing and operational system. ORGANIZING FOR MANAGEMENT INFORMATION SYSTEMS (10%) (a) The computer as data/information processing tools. (i) Computer system architecture. (ii) Hardware and software aspect of the computer. (iii) Processing techniques (distributed, real-time etc.) (b) The need and critical elements of a computer department. (c) Setting up a computer department - planning, feasibility study, and outsourcing versus in-house personnel. (d) Managing change resulting from computerization - management orientation, personnel training, motivation etc. APPROACHES TO SYSTEMS DEVELOPMENT (20%) (a) (b) (c) End-user Computing (E.U.C.) - approaches, benefits and problems Prototyping - types, stages of prototyping Systems development life cycle (i) Problem definition (ii) Systems Investigation assessment of the feasibility/desirability of potential computer projects from the view points of technical, social, operational and economic feasibility including the use of cost benefit analysis; the production of a feasibility report and project plan. 62 (iii) Systems Analysis and Design - (iv) 5. use of appropriate fact finding techniques in order to establish client’s system requirements. identification and application of appropriate systems, analysis and design tools and techniques to enable production of programme specification, database structure, network specifications, document/screen layouts, dialogue design. design and use of human computer interfaces - basics of human computer interface design. determination of systems design criteria systems specifications - input, processing, output, storage and control specifications.. features, benefits and limitations of structured methods Systems Implementation system acquisition and selection criteria - negotiation and agreeing procedures and plans for the implementation, monitoring and maintenance of a new system. application package acquisition or in-house development files and database creation or conversion personnel training testing change over procedures regular post-implementation review documentation, reviews and maintenance. systems failures, causes, management and control. SYSTEMS EVALUATION (10%) (a) (b) (c) (d) (e) Identifying, agreeing and documenting criteria for evaluating potential suitable systems. Evaluating potential suitable systems and packages against agreed criteria. Designing and implementing procedures for systems operation and control. Drawing conclusion from the evaluation and proposing an optimal system. Explaining, negotiating, agreeing and documenting systems modifications. 63 6. 7. IMPACTS OF INFORMATION SYSTEMS (5%) (a) Economic impact social impact effects of technology and education on information and communication, the fear of redundancy and lay offs, user acceptability, trends in human-computer interfacing, privacy, information dissemination and office automation. (b) Formulation of IT strategy CONTROLS AND CONTINGENCY/DISASTER RECOVERY PLAN (10%) (a) (b) (c) (d) (e) (f) (g) (h) (i) 8. Controls objectives/framework Control activities and risk assessment Hardware/software security, backup and recovery procedures - virus infections and data loss. Computer Auditing - Computer Assisted Audit Techniques (C.A.A.T’s). Privacy and accuracy of information - confidential and legal responsibilities, data protection legislations. Computer related crimes and preventions. Use of benchmarking in quality measurement and improvement Evaluation and recommendation of appropriate control systems for the management of organisations Control systems problems and solutions MODERN TRENDS IN INFORMATION AND COMMUNICATIONS TECHNOLOGY (10%) (a) (b) (c) (d) (e) (f) Impact of the internet on business Internet services and applications (i) general application areas e-commerce, government, e-leasing and virtual library (ii) impact on strategic planning (iii) impact on controls of data on transmission (iv) emerging business models (v) encryption techniques and biometric controls e-banking, Data transmission and communication problems and solutions Computer network and the internet Web browsers Computerized archival methods 64 e- 9. CASE STUDY (20%) NOTE: CANDIDATES WILL BE EXPECTED TO APPLY THE KNOWLEDGE IN THIS SUBJECT AND OTHER SUBJECTS LINKED TO IT TO SOLVE SOME REAL-LIFE PROBLEMS D. CONTACT HOURS 90 E. RECOMMENDED TEXTBOOKS Adewunmi, W and Akinlade, T., Data Processing and Management Information Systems. Macmillan/The Chartered Institute of Bankers of Nigeria CIMA, Management Information Systems and the Computer (Parts I & II). Folorunsho, J. O., Practical Approach to Computing, Macmillan Kayode, A. J., Business Information Systems, (A.J.K. Limited) Shave, M. J., Computer Science Applied to Business Systems, Addison – Wesky Watson, Computer for Business - A Managerial Emphasis 65 21.3.4 PAPER 11: A. BUSINESS LAW AIM To examine candidates’: B. familiarity with features of the law regulating the affairs of business associations (companies and partnerships), banking and insurance transactions, as well as the administration of estates and trusts knowledge of social-legal ethics in Nigeria as a function of professional integrity and of promoting foreign investment in the Country ability to apply the above knowledge to specific aspects of accounting functions. awareness of the relevance of this paper to international business transactions. LINKAGES This paper is linked to papers 1, 5, 6, 8,10, 14,17, & 19. The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Six questions out of which candidates are expected to answer four. C. CONTENTS 1. PARTNERSHIP(10%) Nature and types of partnership: Partnership statutes, general and limited partnerships, terms of partnership agreement, rights and duties of partners, inter-relationship between partners and third parties, dissolution of partnership. 2. BANKING, NEGOTIABLE INSTRUMENTS, INSURANCE, EXCHANGE CONTROLS AND LEGAL CONTROLS OF FRAUD AND OF FOREIGN INVESTMENT (25%) The relevant common law and statutory rules as well as the general practices on the following issues concerning the business of banking, negotiable instruments, exchange controls and insurance in Nigeria: 66 (a) Relationship Between Banker and Customer The provisions of the Banks and Other Financial Institutions Act, 1991, the powers and duties of the Central Bank of Nigeria under the Central Bank Act, 1991, the duties and powers of the Nigerian Deposit Insurance Corporation under the Nigerian Deposit Insurance Corporation Act, 2003, the Bills of Exchange Act, 1990 with reference to definition and essentials of a valid bill, acceptance and delivery of bills, inchoate instruments, negotiation and negotiability, duties of the holder and liability of parties, discharge of a bill, cheques and other bills, crossed cheques, protection of bankers, promissory notes. (b) 3. The Insurance Act 2003 - Nature of insurance, indemnity and non-indemnity contract, principles of insurance, insurable interest utmost good faith, misrepresentation, conditions and warranties, subrogation and contribution, assignment of policies. (c) The present exchange control regime requirements. (d) Professional ethics in the Companies and Allied Matters Act 1990, Failed Banks (Financial Malpractices and Debt Recovery) Act 1994, the Money Laundering Act 1995, Advance Fee Fraud and Other Fraud Related Offences Act 1995, the Corrupt Practices and Other Related Offences Act 2000. (e) The Nigerian Investment Promotion Commission Act 1995, the Investment and Securities Act 1999 and National Privatisation and Commercialisation Act 1999 as amended. TRUSTEESHIP, EXECUTORSHIP AND BANKRUPTCY LAWS (25%) The appointment, duties, obligations and accounts of trustees, termination of trusts, wills and letters of administration, devolution of property, powers and duties of executors and administrators, distribution of estate, Trustee Investment Act, 1990. The provisions of the Bankruptcy Act, 1990 relating to acts of bankruptcy, issue of receiving orders, composition and schemes of arrangement, adjudication and discharge, appointment and powers of official receiver and trustee in bankruptcy, property available, proof of debt, statement of affairs and deficiency account. 4. COMPANY LAW (40%) (a) Nature and types of companies, formation of companies, Memorandum and Articles of Association, prospectus, shares, share capital, debenture, ultravires doctrine, members meetings and resolutions, members, directors, secretary and secretarial practice, statutory books and returns, profit available for distribution, payment of dividends, holding and subsidiary companies, winding up, powers and duties of liquidators and receivers, acquisitions, mergers and take over bids as contained in the Companies and Allied Matters Act, 1990 ( as amended). 67 D. CONTACT HOURS 60 E. RECOMMENDED TEXTBOOKS Ezejiofor, G., Okonkwo C., and Ilegbue, C. U. Nigerian Business Law, Sweet and Maxwell, London. Omojola, F., General Principles of Business Law in Nigeria. Asomugha, E., Company Law in Nigeria Under the Companies and Allied Matters Act, 1990, Tome Micro Publishers Limited, Lagos. Bakibinga, I., Nigerian Law of Partnership, Obafemi Awolowo University Press Limited, Ile-Ife. Bigg, W.W. and Thompson, Rankin, Spicer and Pegler’s Mercantile Law, HFL ( Publishers) Limited, London. Chorley, Lord and Giles, O.C., Slater’s Mercantile Law, Pitman, London. Jegede, M. I., Law of Trusts, Bankruptcy and Administration of Estate, MIJ professional publishers. Fabunmi J. O., Equity and trusts in Nigeria. Federal Republic of Nigeria, Companies and Allied Matters Act, 1990 Federal Republic of Nigeria, Banks and Other Financial Institutions, Act 1991 Federal Republic of Nigeria, Central Bank of Nigeria Act 1991 68 21.4 PROFESSIONAL EXAMINATION II 21.4.1 PAPER 12 A. FINANCIAL ACCOUNTING II AIM To examine candidates’: B. in-depth understanding of the relevant accounting principles and legal framework in preparation of accounting records and published financial statements for group of companies skill in the application of principles, techniques and regulatory framework required in business capital reconstructions, combination and discontinuation appreciation of the limitation and constraint of information conveyed in conventional financial statements ability to critique financial statements and make valid judgment concerning the state of health of economic organisations. LINKAGES This paper is linked to papers 1, 3, 4, 5, 6, 7, 8, 9, 11, 13, 16, 17, 18 & 19 The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Six questions out of which candidates are expected to answer four. C. CONTENTS 1. PUBLISHED GROUP ACCOUNTS (30%) (a) The legal and regulatory framework in the preparation of group accounts (b) The preparation of consolidated financial statements (to include the group cash-flow statement) involving one or more subsidiaries, sub-subsidiaries and associates, under the acquisition and pooling of interests method. (IAS 22 & 27) (c) The treatment in consolidated financial statements of minority interests, pre-and post - acquisition reserves, goodwill, fair value adjustments, intra-group transactions and dividends, piecemeal and mid-year acquisitions, and disposals to include subsubsidiaries and mixed groups 69 (c) The accounting treatment of joint ventures and associates (IAS 28 & 31) using the equity method and proportional consolidation method. Foreign currency translation (IAS 21 and SAS 7) to include overseas transactions and investments in overseas subsidiaries. 2. BUSINESS COMBINATIONS AND RE-ORGANISATION (15%) (a) (b) (c) 3. ACCOUNTING FOR BANKRUPTCIES AND LIQUIDATION (15%) (a) (b) 4. (b) Theory and application of all operational accounting standards (Statements of Accounting Standards and International Accounting Standards). Accounting for changes in price level. INFORMATION TECHNOLOGY IN ACCOUNTING ENVIRONMENT (10%) (a) (b) (c) (d) D. Analysis of financial statements and use of ratios. Trend analysis based on absolute values and percentages. Report writing FINANCIAL ACCOUNTING STANDARDS (15%) (a) 6. preparation of statement of affairs for insolvent individuals, partnerships and limited liability companies. Statement of distribution of the receiver and liquidator. ANALYSIS AND INTERPRETATION OF FINANCIAL STATEMENTS (15%) (a) (b) (c) 5. amalgamation or merger absorption or purchase of business reconstruction - internal and external - through implementation of given schemes. Accounting systems developments involving easy-to-use and robust pre-packaged accounting software to help organisations structure their systems to provide effective and efficient support for their primary objectives and activities. Information development and information system design, information system management and control, and information system evaluation. Transaction processing in typical business and accounting applications. Network and Electronic Data Transfer. CONTACT HOURS: 75 70 E. RECOMMENDED TEXTBOOKS: Akeju, J.B., Accounting for Company Business, JBA Limited, Lagos. Akeju, J.B., Financial Accounting, Volume 1, JBA Limited, Lagos. Alexander, D., Financial Reporting: The Theoretical and Regulatory Framework, Chapman & Hall. Biggs, W.W. & Perrins, R.E.G. Spicer and Pegler’s Book-Keeping and Accounts, H.F.L. BPP, Financial Accounting, Dryden Press. Davidson, F., Financial Accounting, Dryden Press. Elliot, B and Elliot, J., Financial Accounting and Reporting, Prentice-Hall. Jennings, A.R., Financial Accounting Manual 1 & 2, DP Publications. Lee, G.A., Modern Financial Accounting, Van Nostrand Reinhold. Lewis, R & Pendrill, Advanced Financial Accounting, Pitman. Pickles, W. and Lafferty, J., Accountancy, Pitman London. Wallis, R.W., Accounting – A Modern Approach, MacGrow-Hill 71 21.4.2 PAPER 13 MANAGEMENT ACCOUNTING A. AIM To examine candidates’: B. ability to provide relevant information to assist the management of organisations in various sectors and at the operational and strategic levels in planning, decision making and in controlling operations ability to analyse problem situations, propose and/or evaluate alternative courses of action knowledge of the relevant quantitative techniques in solving problems ability to assist management in identifying and applying appropriate performance measurement techniques use of information and communication technology in solving problems and preparation of reports. LINKAGES This paper is linked to papers 1, 2, 3, 4, 7, 8, 9, 10, 14, 15, 17, 19 The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Answer questions one and any other three questions. C. CONTENTS 1. NATURE AND PURPOSE (5%) (a) An overview of management accounting (b) Management accounting as a tool of management and its role in a changing environment. (c) concepts commonly used in planning, control and decision making such as full cost, sunk cost, marginal or direct cost, opportunity cost, incremental cost or differential cost. 72 2. PLANNING (15%) (a) Long Term (i) objectives of long term planning. (ii) procedure and stages for developing long-term plan including evaluation of alternatives. (iii) implementation of long-term plan and annual budget. (iv) monitoring and control. (b) Short Term (i) types of budgets (ii) budgeting process covering but not limited to identification of objectives, search for possible courses of action, gathering data about alternatives and measuring pay-offs, selection of course of action, and monitoring outcomes and comparing with actual performance. (iii) Working Capital Management. - - the components of working capital and the importance of effective working capital management to corporate survival. cash: preparation of cash budget and management of cash surpluses and deficits; cash management models. debtors: analysis and evaluation of various credit terms, use of cash discounts and debt collection techniques, debt factoring and invoice discounting. creditors: evaluating trade credits and the advantages and disadvantages of trading on credit. stocks: formulation of various stock policies and stock control systems techniques including inventory models such as Economic Order Quantity (EOQ), and Just-In-Time (JIT). Implications of inventory control for the financial manager. (iv) alternative approaches to budgeting such as zero-based budgeting (ZBB), Programme Performance Budgeting System (PPBS) and Activity-Based Budgeting (ABB). 3. CONTROL (15%) (a) Control theory in management accounting including feedback loops, open and closed systems. (b) Control aspect of budgeting involving (i) budgetary control, its objectives and relationship with responsibility accounting (ii) controllable and uncontrollable outcomes (iii) analysis of variances 73 (v) investigation and evaluation of variances including use of probability distribution and normal distribution curves (v) behavioural aspect of budgeting including goal congruence, motivation and the problems of dysfunctional behaviour (c) Standard Costing (i) (ii) (iii) (iv) relationship of standard costing with budgeting types of standards and procedure for setting standards variance analysis planning and operational variances 4. DECISION MAKING (20%) (a) Short Term (i) profit analysis - application and limitation (ii) measuring costs and benefits, decision making involving dropping a segment, make or buy decision, replacement of equipment (iii) cost-volume-profit analysis under conditions of uncertainty (iv) pricing - objectives of pricing and factors influencing pricing decisions - pricing methods: cost and market based methods - cost plus, marginal cost, average or lowest market prices or negotiated prices - product-life cycle and appropriate pricing strategies (b) Long Term - Capital Budgeting (i) objectives of capital budgeting (ii) techniques of evaluating capital budgets such as pay back period, accounting rate of return, cost benefit analysis, discounted cash flow(DCF) techniques-net present value (NPV), internal rate of return (IRR), and profitability index (iii) capital rationing (single period, multi period) and use of linear programming (c) Risks and Uncertainty (i) measurement of risks (ii) decision tree (iii) portfolio theory (iv) sensitivity analysis (v) probability analysis (vi) utility theory 74 5. APPLICATION OF QUANTITATIVE METHODS (15%) (a) Cost estimation methods (b) Inventory control and estimation of optimum stock (a) Linear programming techniques 6. DIVISIONAL PERFORMANCE EVALUATION (10%) (a) Performance measures and control in divisionalised companies: (i) organisational arrangement – structural decentralisation and divisionalisation (ii) methods of assessment such as absolute profit, residual income, return on investment (b) transfer Pricing in divisionalised companies (i) (ii) (iii) 7. PRESENTATION OF MANAGEMENT INFORMATION (a) (b) 8. objectives of transfer pricing setting of transfer pricing determination of optimum transfer price (5%) Fundamentals and formats of reporting Feedback information and reaction CURRENT DEVELOPMENTS IN MANAGEMENT ACCOUNTING (5%) Candidates will be tested on new issues such as Advanced Manufacturing Technology (AMT), backflush, target costing, Activity Based Costing (ABC), throughput accounting, life-cycle costing. 9. CASE STUDY(10%) Candidates will be required to apply different aspects of this paper to solve problems and also draw on the knowledge of other interlinked papers at lower or the same level of the institute’s examinations. D. CONTACT HOURS 90 75 E. RECOMMENDED TEXTBOOKS Asaolu, T. O. and Nasser M. L., Essentials of Management Accounting, Cedar productions. Azrudd, J. and Hope, T. Accounting for Management Decision, Prentice-Hall. Drury, C., Management and Cost Accounting, Van Nostrand Reinhold Ltd. Horngren, C. T., Cost Accounting: A Managerial Emphasis, Prentice-Hall. Kaplan, R. S., Advanced Management Accounting, Prentice-Hall (New Delhi). Lucey, T., Management Accounting , DP Publication. Ola, C. S., Management Accounting System, Grahan Burn. Ola, C. S., Management Accounting: Theory and Application, Heinemann Educational Books Nig. Plc. 76 21.4.3 PAPER 14 A. PUBLIC SECTOR ACCOUNTING AND FINANCE AIM To examine candidates’ B. familiarity with the peculiar nature of socio-economic objectives of public sector organisations – government ministries and extra – ministerial departments, public utilities and other economic undertakings operating in the public sector, the problems and constraints which these pose for their operating, accounting and reporting functions understanding of the nature, techniques and the practice of public sector accounting and finance ability to generate relevant accounting information in aid of decisions in the public sector familiarity with accounting problems and practices of public sector organisations. LINKAGES This paper is linked to papers 1, 4, 5, 11, 12, 13, 15, 17,18, & 19. The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Six questions out of which candidates are expected to answer four. C. CONTENTS 1. THE CONSTITUTIONAL & REGULATORY FRAMEWORK OF PUBLIC SECTOR ACCOUNTING (10%) (a) The constitutional, legislative and regulatory context of government accounting: (i) the constitutional provisions on revenue, revenue allocation and public expenditure (federal, state and local government). (ii) the provisions of the Finance (Control and Management) Act of 1958 (as amended). (iii) financial Regulations for Federal and State Governments, and the Financial Memoranda for Local Governments. (iv) the generally accepted accounting principles applicable to the Public Sector-Local and International sources. (b) The economic environment of public sector accounting (i) performance of the Nigerian economy: a historical perspective the economic role of the public sector. 77 2. 3. GOVERNMENT ACCOUNTING THEORY AND PROCESSES (10%) (a) Accounting concepts, bases, and principles relevant to government accounting. (b) The concept of funds, its relationship to the entity concept and its implications for income measurement and valuation. (c) Professional pronouncements on government accounting by the United Nations, the International Consortium on Government Financial Management, Chartered Institute of Public Finance and Accountancy (CIPFA) and International Federation of Accountants (IFAC). (d) Standardisation of Federal and State Governments accounts in Nigeria. FINANCIAL MANAGEMENT IN FEDERAL, STATE AND LOCAL GOVERNMENTS (30%) (a) The institutional framework: (i) nature and types of financial controls in government. (ii) the financial control institutions: the Treasury Department Office of the Accountant-General, the Planning and Budget Department, Office of the Auditor-General, Expenditure Control Unit - their functions and procedures. (iii) role of National and State Assemblies and Local Government Councils in financial-management and control. (iv) source documents: revenue vouchers, payment vouchers, journal vouchers - their format, contents and uses. (b) Planning and budgeting: (i) the principles of budgeting in the public sector. (ii) types of budgeting - one line budgeting, line-item budgeting, Zero-Based, Budgeting (ZBB), Programme Performance Budgeting System (PPBS). (c) Preparation and appraisal of budgets. (i) internal control of revenue and expenditure (ii) the warrant system and virement procedure (iii) the vote books and budgetary control (iv) revenue control procedures (v) pre-payment audit (d) Government accounting processes (I) Books of accounts - cash book, journal, and the ledger; their preparation, (ii) uses and limitations. (iii) computerised accounting system in government accounting. (iv) reconciliation of accounts (v) consolidation of government accounts 78 (e) Ministerial accounting system: (i) self and non-self accounting units (ii) limited self-accounting (iii) accounting procedures up to preparation of the trial balance and transcripts (iv) preparation and posting of monthly payroll and variation control report (v) pensions and pension fund accounting (f) (g) Ethical issues in government accounting Financial reporting: (i) (ii) (iii) (h) 4. Interpretation of government financial statements ACCOUNTING FOR PUBLIC SECTOR ORGANISATIONS: AUTHORITIES, PARASTATALS, BOARDS, CORPORATIONS, AGENCIES AND TERTIARY EDUCATIONAL INSTITUTIONS (20%) (a) (b) (c) 5. Preparation of statutory financial statements in the treasury (Federal and State) Preparation of statutory financial statements in Local Governments Cash flow and value added statements The general nature of, and differences among, these bodies. Financial provisions of enabling laws for the relevant utilities, authorities, parastatals, boards, corporations, agencies, and tertiary educational institutions. Financial reporting: (i) receipts and payments accounts (ii) income and expenditure accounts (iii) the balance sheet (iv) value-added statement (v) cash flow statement (vi) five year financial summary ANALYSIS FOR DECISIONS IN THE PUBLIC SECTOR (10%) Application of cost and management accounting principles in governments and governmental bodies for: (a) (b) (c) 6. Preparation of budget estimates Pricing of services – fees and levies Pricing and negotiating contracts PUBLIC FINANCE (20%) 79 (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) The economic environment and role of the public sector. (i) performance of Nigerian economy (ii) the economic role of the public sector Main sources of revenue and capital finance Nature and structure of public expenditure Borrowing policy and public debts (i) funded and unfunded debts (ii) external loans: multilateral, Paris club, London Club, Promissory Notes, others Debt Management Strategies; (i) loans pooling and consolidation (ii) loan re-scheduling (iii) debt-equity swap (iv) debt forgiveness Principles and practice of federalism; fiscal capacity and needs in multi-level government structures. Inter-governmental fiscal relations, Nigeria’s experience with revenue allocation. The theory and practice of grants in relation to state and local government. Project appraisal in the Public Sector (i) cost-benefit analysis (ii) cost-outcome analysis (iii) cost-Effectiveness analysis (iv) dimensions of project performance such as availability, efficiency, outcome, effectiveness and accessibility Rolling Plans and perspective plans; (i) relationship between rolling and perspective plans to PPBS (ii) linkages between the perspective plan, rolling plan and the annual budgets. 80 D. CONTACT HOURS 60 E. RECOMMENDED TEXTBOOKS Asechemie, D.P.S., Anatomy of Public Sector Accounting in Nigeria, Sunray Books Limited Awoyemi, E. O., A Guide to Government Accounting and Internal Audit, Onibonoje Press, Ibadan Daniel, G. I.. Public Sector Accounting, Ahmadu Bello University Press, Zaria, 1999 Glynn, J. J., Public Sector Financial Control and Accounting, Blackwell Hassan, M. M., Government Accounting, Malthouse Press Ltd., Lagos, 2001 Johnson, E. I., Public Sector Accounting and Financial Control, Financial Training, Nigeria, Lagos Jones, R. and Pendelbury, M. Public Sector Accounting, ELBS/Pitman Federal Government of Nigeria, Constitution, 1999 Financial Regulations 2000 Financial Memoranda for Local Government Musgrave, R. A. & Musgrave, P. B., Public Finance in Theory and Practice, MacGraw - Hill, New York Oshisami, K., Government Accounting and Financial Controls, Spectrum Books Ltd., Ibadan Robert G. Finney: Powerful Budgeting for Better Planning and Management, American Management Association, New York, 1993. Vatter W. J.: The Fund Theory of Accounting and its Implications for Financial Reports. University of Chicago, Chicago, 1947. 81 21.4.4 PAPER 15 BUSINESS COMMUNICATION AND RESEARCH METHODOLOGY A. AIM To examine candidates’: B. ability to identify researchable problems knowledge of how to systematically and purposefully gather data from a variety of relevant sources on chosen topics ability to conceptualise and originate a study, define the procedure to adopt to carry out the study and the “appropriate” method of presenting the results for decision making ability to appraise the quality of a research study work ability to search for and use existing knowledge on a subject matter to form the framework for advancement in the understanding of it (subject matter) and the basis for advancing such knowledge use of various methods of referencing borrowed materials from existing published and unpublished literature. LINKAGES This paper is linked to all papers. The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Six questions out of which candidates are expected to answer four. C. CONTENTS 1. INTRODUCTION TO RESEARCH METHODOLOGY(5%) (a) (b) (c) (d) Definition and purpose of research Importance, usefulness/benefit of research Types of research: Basic (pure) and applied Special cases in behavioural research: Experimentation, field study (export fact) survey, case study e.t.c 82 2. 3. STAGES OF RESEARCH (25%) (a) Problem identification (i) problem definition in line with the aims and objectives (ii) formulating research questions and hypotheses (iii) scope and limitations of the specific research problem (iv) research plan (b) (c) Review of related literature Research Design and Methodology Overview of: (i) research population, sample and sample size (ii) sampling procedures and methods (iii) nature of data and information including methods of data collection (iii) qualities of a good questionnaire, and types of questions (open and close-ended questions) (d) Questionnaire Design (its development) (i) aims and objectives (ii) developing a set of quantifiable indicators relevant to the objectives (iii) drawing up a set of research questions giving the indicators (iv) grouping the questions into sections according to subject matters. (v) measurement scales (vi) treatment of sensitive questions (e) (f) (g) (h) (i) Pilot testing validity and reliability tests Costing of research project/ research budget Publicity (awareness of the data collection exercise) The main survey with logistics including personnel training Preliminary analysis and post enumeration survey (PES) METHODS OF DATA ANALYSIS (20%) (a) (b) Data summary, tables, (1 and 2 dimensional tables) charts, graphs and summary statistic. Statistical tools in research methods. (i) a review of relevant statistical concepts and methods as available under quantitative analysis syllabus. (ii) other tools in Research methods including two sample test of mean and proportion confidence intervals for the difference of two mean and proportions testing the equality of several means: analysis of variance (ANOVA) multiple linear regression and coefficient of determination cross tabulation and chi-square test 83 4. INTERPRETATION OF RESEARCH FINDINGS INCLUDING COMPUTER PRINT OUT OF RESULTS (5%) 5. REFERENCE AND BIBLIOGRAPHY (5%) (i) (ii) (iii) 6. STEPS IN WRITING RESEARCH PROPOSAL (10%) (i) 7. 8. differences between reference and bibliography methods of referencing – Harvard, Chicago, APA schools, Library of congress approaches appendices (if any) steps in writing proposal may include but not limited to: - cover page - an executive summary - justification for the study - objectives of the study - methodology - data gathering - method of analysis - the work plan - facilities available to the researcher - detailed budgeting - expected results - policy implications - documentation - references EVALUATION/TESTING PROCEDURE (10%) (a) Candidates may be provided with practical research data and be required to collect, analyse and generate finding, conclusions and recommendations. (b) Marketing Research & Feasibility Studies REPORT WRITING (20%) To include: (a) (b) (c) (d) (e) (f) (g) (h) Attribute of a good report Presenting the findings of the study Interpreting the findings Methods of presenting the findings of the study Drawing inference and conclusions from the results of the study Developing recommendations and signposts for future research from the findings Executive summary Notices, minutes, memoranda 84 D. CONTACT HOURS: 60 E. RECOMMENDED TEXTBOOKS 1. Anao, A. R. & Uche C. U. Research Methodology 2. Asika N. (1999) Research Methodology in Behavioural Sciences, Ikeja Longman Nigeria 3. Osuala, E. C.,(1993) Introduction to Research Methodology, Onitsha, African-FEP Publishers Ltd.; 4. Owojori A. A. (2002) Managerial Research Kaycee Publishers, Ado-Ekiti 85 21.5 PROFESSIONAL EXAMINATION III 21.5.1 PAPER 16 FINANCIAL REPORTING AND AUDIT PRACTICE A. AIM To examine candidates’: B ability to evaluate accounting practice with particular reference to capital maintenance theory, asset valuation and disclosure and expression of economic substance over form ability to evaluate career developments under discussion to improve the regulation of financial reporting ability to analyse and interpret financial statements in an international context ability to apply professional ethical considerations in the practice of financial reporting understanding of regulatory and ethical considerations governing the conduct of audit and assurance engagements in-depth knowledge and skill in the application of computer based accounting system ability to prepare reports on specialized audits and investigations and proffer tactical solutions to dynamic problems ability to exercise professional competence in dealing with problems in re-engineering, insolvency and specialized audits ability to apply professional expertise in audit and investigation with a view to ensuring transparency and accountability in the public sector ability to anticipate and react to current and future audit and assurance related services. LINKAGES This paper is linked to 1, 5, 6, 8, 9, 10, 11, 12, 13, 16, 18, & 19. The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Six questions out of which candidates are expected to answer four. 86 C. CONTENTS 1. ANALYSIS OF FINANCIAL STATEMENT FOR GROUP AND NONGROUP ESTABLISHMENTS(15%) (a) (b) (c) (d) (e) 2. FINANCIAL VALUATIONS AND FINANCIAL REPORTING ISSUES (10%) (a) (b) 3. In-depth analysis of annual report Identification and application of financial performance indicators Limitations of instruments of performance measurement and annual report contents in providing required information to users Computation, interpretation and analysis of strengths and weaknesses of ratios to assess the areas of profitability, financial adaptability, liquidity, activity of the business, gearing and other performance indicators Different levels of performance evaluation, inter-firm, targets, historical achievements, international, departmental or segment analysis Financial valuations (i) business valuation (ii) valuation of shares (iii) tangible and intangible assets valuation Financial Reporting Issues (i) earnings per share, including the effect of bonus issues, rights issues and convertible loan stock (ii) reconstruction - formulation of schemes (iii) application of principle of substance over form to: purchase agreement debt factoring secured assets loan transfer consignment of stock private financing initiative (iv) capitalization of interest (v) measurement and disclosure of financial instruments (vi) environmental and social responsibility accounting and reporting (vii) human resources accounting INTERNATIONAL ACCOUNTING (5%) (a) Accounting for multi-national organisations 87 (b) (c) (d) 4. AUDIT PLANNING AND CONTROL (10%) (a) (b) (c) (d) 5. Foreign exchange arithmetic, conversion into foreign currency and factors affecting rates of exchange, rates adjustments, cross rates and arbitrage Comparison and full discussion of selected Generally Accepted Accounting Principles (GAAP’s) of United Kingdom, United States of America, International Accounting Standards and Nigerian Statements of Accounting Standards in preparation and interpretation of financial statements Inflation accounting - application to multi-national organisation financial statements. Development of audit strategy (i) determination and uses of quantitative and qualitative materiality consideration (ii) multiple locations and consolidated organizations consideration. Determination of audit risks (i) inherent risks (ii) control risks (iii) detection risks Execution of audit strategy (i) documentation and assessment of control systems (ii) nature, extent and timing of audit procedures Organising, audit working papers and working with specialist reports. MANAGEMENT OF AUDIT PRACTICE (10%) (a) (b) (c) (d) (e) Organisation and conduct of professional office: (i) office and office facilities (ii) partners relationship (iii) staff management (iv) quality control (v) training Standards for assurance engagement (i) definition and underlying concept of assurance engagement (ii) quality control practices and procedures, advertising and publicity, fees, tendering, engagement letters, and consultation (iii) performance and reporting standards Appraisal of expectation gap, responsibilities for fraud detection, prevention, reporting errors, omissions, misstatements and other irregularities. Case studies and implication of new developments from researches, decided cases, standards and other sources. Negotiation skill: for own office and on behalf of clients Auditors’ liability 88 6. PUBLIC SECTOR AUDIT (10%) (a) (b) (c) (d) (e) (f) 7. SPECIALISED AUDIT AND INVESTIGATION (a) (b) (c) (d) (e) 8. Audit of corporations and parastatals. Specialised audits: contracts, pensions, defence and security agencies, Audit of Nigerian foreign missions and agencies . Value for money audit. Investigation in the public sector: use of probe panel in investigating fraud and corruption. Due process review (15%) Understanding of special features of the following types of organizations (i) farmers, professionals, hospitals, hotels etc. (ii) forensic investigation and audit, (i) Specific audit difficulties relating to financial institutions:- banks, insurance, companies, primary mortgage institutions etc. (ii) audit of not-for profit organizations – charities, NGO’s Joint audit. Investigation (i) distinction between auditing and investigation. (ii) nature, classes and methods of investigation. (iii) auditors’ involvement with prospectuses and other offer documents. (iv) examination of financial forecasts and projections. (v) the report appropriate to each type of investigation. Insolvency (i) various legal processes involved in corporate distress. (ii) differences between receivership, receiver/manager, bankruptcy and liquidation. (iii) implications of insolvency for corporate governance and going concern threats. PRINCIPLES AND APPLICATION OF PROFESSIONAL ETHICS(15%) (a) (b) (c) (d) (e) (f) The nature of ethics; differentiation between philosophical and professional approach. Concepts of integrity, obligation, independence, public expectations. Ethics and the professions; social responsibility Ethics and the law Consequences of unethical behaviour to the individual, to the profession and to society at large Ethical standards and professional responsibilities, professional independence, confidentiality, objectivity, securing professional work, consultancy, succession arrangement, disciplinary 89 (g) (h) 9. procedures, compliance with standards and professional development. Relationship with fellow members, joint engagements, communication with predecessor, special assignment and other assurance services. Corporate Governance: (i) auditors responsibility in relation to shareholders information and participation rights. (ii) the duties and organizations of the board of directors and the management. (iii) systems of checks and balances. CASE STUDY10% D. CONTACT HOURS 90 E. RECOMMENDED TEXTBOOKS Alenxander, D. and Balttan, A., Financial Reporting, International Thomson Business Press. Beaver, W. N., Financial Reporting, An Accounting Revolution, Prentice Hall Chambers, A. N. and Court, J. N., Computer Auditing, Pitmans. Griffin, P. A., Cases in Corporate Finance Reporting, Prentice-Hall. IFAC, IFAC Guidelines, Gee & Co. Lee, T. A., Corporate Audit Theory, Chapman & Hall. Swinson, C. H. Group Accounts, Butterworths. Topples, B. S., Consolidated Accounts, Accounting Tuition Centres. Woolf, E. Auditing Today, Prentice Hall International. 90 21.5.2 PAPER 17 STRATEGIC FINANCIAL MANAGEMENT A. AIM To examine candidates’: B. understanding of the principles of business strategy and ability to differentiate between corporate strategy and financial strategy familiarity with the major concepts, techniques and tools employed in the sourcing of business finance and its efficient deployment to optimize the value of the business ability to apply appropriate Financial Management techniques in analysing the cost and benefits of various sources of finance and capital investment opportunities allowing for the effects of taxation, inflation, risk and uncertainty familiarity with financial market operations including appreciation of the role of financial intermediaries in the provision of short, medium and long term funds understanding the need for as well as the techniques of, and approaches to corporate re-organisation and re-engineering ability to analyse the changing competitive business and economic environment factors (including the impact of Information and Communication Technology - ICT) and to formulate appropriate financial strategy Familiarity with recent developments in Financial Management as well as the international dimensions of Financial Management Ability to analyse and interprete case studies and present adequate and consice report for decision-making. LINKAGES This paper is linked to papers 1, 3, 4, 5, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 18 and 19. The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Answer questions one and any other three questions. 91 C. CONTENTS 1. NATURE AND SCOPE OF STRATEGIC FINANCIAL MANAGEMENT (10%) (a) (b) (c) Scope of Strategic Financial Management Goals and Objectives of Corporate Strategy Financial Objectives of both profit and not-for-profit organisations maximizing shareholders wealth, value for money, providing a surplus e.t.c. Principles of corporate governance: relationship between the company, management and other stakeholders. Scope of directors’ responsibilities, adequacy of disclosure requirements, creative accounting, window dressing, e.t.c. Directors’ remuneration and perquisities, rewards and sanctions. The effect of good and bad corporate governance on the value of the business via share price The Nigerian capital market and the developments in terms of depth and breadth The nature and functions of money and capital markets. Distinctions between the two markets. Instruments of each of the markets: nature, characteristics, advantages and disadvantages. Key participants; individuals, companies, banks, non-bank financial institutions and Government agencies e.g. Central Bank of Nigeria (CBN), Nigerian Stock Exchange (NSE), Securities and Exchange Commission (SEC) Functions of the treasury manager in relation to corporate objectives, working capital management, currency management e.t.c. (d) (e) (f) (g) (h) 2. CORPORATE STRATEGY INFORMATION AND FINANCIAL MANAGEMENT (5%) (i) corporate strategy (a) (c) (d) (e) Types and importance of strategy including the relationship between corporate strategy and financial strategy Long-term strategic planning, and differences between strategic, tactical and operational planning Development of a corporate plan and its relationship to budgeting Long-term financial planning Total Quality Management (TQM) (ii) information and financial management (a) The impact of Information and Communication Technology on financial management practice e.g. e-commerce, e-banking, e-business risk, egovernment Essentials of financial Management Information and Reports such as economic reality, relevance, timing, accuracy - and the implications of uncertainties for reports, statements and analyses given by the Financial Manager (b) (b) 92 3. CAPITAL INVESTMENT DECISIONS (15%) (a) (b) (c) (d) (e) (f) 4. FINANCIAL, CAPITAL STRUCTURE AND DIVIDEND POLICY DECISIONS (15%) (a) (b) (c) (d) (e) (f) (g) 5. Mathematics of finance - time value of money, present value, yield on investments, loan amortisation, sinking fund e.t.c Capital expenditure planning and control and the identification and evaluation of investment opportunities including risk and return relationship Techniques of investment appraisal including payback period, discounted payback period, return on investment, NPV, IRR, “Modified” IRR, PI, Cost-Benefit-Analysis, Value for money Evaluation of capital projects: Capital rationing including application of Linear programming in Multi-period capital rationing, replacement and abandonment decisions Advanced Manufacturing Technology (AMT) and project appraisal techniques: types of AMT investments, relevance and shortcomings of current appraisal techniques in evaluating AMT investments Treatment of inflation, taxation, risk and uncertainty and the effects of government policies on investment decisions Identification and evaluation of various sources of finance: Share capital, Loan capital, convertibles and warrants, trade credit and bank finance The concept and measurement of the various costs of capital - equity, preference shares, debentures and loan stocks Optimal capital mix: evaluation and determination of financial requirements of corporate entities and organisations emphasising the factors which influence the choice of capital structure: Weighted Average Cost of Capital (WACC). Weighted net income/net operating income approach (Modigliani and Miller concept) Active and passive dividend policies and factors influencing dividend policies Types of dividends - cash dividend and stock dividend Legal and procedural aspects of dividend payment in Nigeria Relevance and irrelevance theories of dividend policy to the value of firm CAPITAL MARKET FINANCING AND RISK MANAGEMENT (10%) (a) Public issues: methods and procedures for new issues (b) The cost of new issues (c) Rights issues: the mechanics of rights issues, subscription price, theoretical ex-rights price, value of rights, effects of rights issues on the price of the shares and on share holdings, underwriting arrangements (d) Private placing: methods of issue (e) Public issue of bonds and debentures (f) Leasing: Definition, types of lease (operating leases, finance leases), advantages and disadvantages, accounting and tax management of leases. After tax analysis of lease/buy/borrow and hire purchase 93 (g) Capital market efficiency - forms and tests of efficiency, implications of the efficiency of the market (h) The applicability of market efficiency to the Nigerian capital market and empirical evidence of tests on the market (i) Portfolio analysis: selection and decision techniques (j) The market models - Capital Asset Pricing Model (CAPM), Arbitrage Pricing Model (APM) (k) Measurement for portfolio performance 6. CORPORATE RE-STRUCTURING, MERGERS AND ACQUISITIONS (15%) (a) The need and purpose of restructuring (b) Types of restructuring, take-overs, leveraged buy-outs, distress restructuring (c) Valuation of financial assets, business units and entities (d) Features of a merger, estimating the economic gains and costs of mergers (e) Basic forms of acquisitions (f) Motives for mergers and acquisitions (g) The mechanics and tactics of a merger (h) Evaluating financial performance of merged companies including reasons for their successes and failures (i) The impact and effects of government regulations on mergers and acquisitions 7. FINANCIAL MANAGEMENT OF SMALL & MEDIUM SCALE ENTERPRISES (10%) (a) SME’s and capital Investment appraisal techniques (b) Justification for the use of popular but incorrect techniques such as pay back, and ARR (c) The need for SME’s to embrace the use of DCF techniques viz NPV, IRR e.t.c. (d) Determination of financial needs of SME’s, problems of SME’s financing, accessibility to other sources of finance such as venture capital, cheaper government fund, government grants and subvention as well as International funds. 8. INTERNATIONAL FINANCIAL MANAGEMENT (10%) (a) (b) (c) (d) International financial markets and their associated risks including interests rate determination Currency, futures and options markets: Future contracts, currency options, commodity exchange e.t.c Exchange rate determination, identification and management of exchange rate risk exposure Hedging against currency risks The role of the following financial institutions in financing international trade: Nigerian Export - Import (NEXIM) Bank, African-Export-Import Bank (AFREXIM), Bank of Industries (BOI), African Development Bank (ADB), International Monetary Fund (IMF), World Bank, International Finance Corporation (IFC), the Paris Club, London Club e.t.c. 94 9. CASE STUDY (10%) D. CONTACT HOURS 120 E. RECOMMENDED TEXTBOOKS Alile, H. and Anao, A. R., Nigerian Stock Market in Operation, Nigerian Stock Exchange Shapiro Alan C., Multinational Financial Management, New Delhi; Prentice Hall of India Private Limited, Fourth Edition. Holland John, International Financial Management; United Kingdom, Blackwell Publishers. Richard A. Brealer & Stewart C. Myers: Principles of Corporate Finance, U.S.A., Fourth Edition Kayode, A. J., Financial Management - Students Manual; AJK Limited Marsh, W.H. & Kunlanslay: Case Problems in Financial Management; Prentice Hall Pinches, G. E., Essentials of Financial Management, Harper & Row Samuels, J. M. & Wilkes, F.N., Management of Company Finance, Van Nostrand Reinhold Van Horne, J. C., Fundamentals of Financial Management, Englewood Cliffs, N. J. Prentice - Hall 95 21.5.3 PAPER 18: TAX MANAGEMENT AND FISCAL POLICY A. AIM To examine candidates’: appreciation of the importance of taxation in personal and corporate financial planning and decision-making ability to identify and avail clients of the opportunities for minimizing potential tax liability by making full use of available options knowledge of the components of government’s fiscal policy functions which influence government’s exercise of its power to tax. B. LINKAGES This paper is linked to papers 1,3,5, 8, 7, 11, 9, 14, 15, 12, 16, and 19 The Paper will be a three-hour paper divided into two sections. SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Answer questions one and any other three questions. C. CONTENTS 1. PETROLEUM PROFITS TAX (PPT) (20%) (a) (b) (c) (d) (e) (f) (g) (h) (i) (j) (k) (l) Administration of PPT Cap 354 LFN. 1990 Understanding the nature and classification of income Understanding the nature and classification of costs Ascertainment of adjusted profits and imposition of costs Allowable and non-allowable deductions Treatment of losses Computation of capital allowance Tax offsets, petroleum investment allowance, computation of chargeable tax and the concept of additional tax Knowledge of the concept and computations of posted prices Familiarization with memorandum of understanding (MOU) as it applies to petroleum prospecting companies Incentives available to companies engaged in the utilization of associated gas objectives and nature of incentives Understanding the Joint Venture (JV) contracts and Production Sharing Contracts (PSC) as they apply to petroleum operations 96 2. CAPITAL GAINS TAX (CGT) 10% (a) (b) (c) (d) 3. (e) Disposal and acquisition of assets: (i) hire purchase transactions. (ii) part disposal (iii) connected persons (iv) consideration aspect (v) death (vi) asset lost or destroyed (viii) bargains comprising two or more transactions. (f) Planning for tax savings in capital gains tax. (g) Reliefs: (i) delayed remittances or gains. (ii) double taxation relief (iii) roll-over relief. (h) Other matters e.g. partnerships, legatees, artificial transactions. CORPORATE TAXATION INCLUDING TAXATION OF INCOME, PIONEER ACTIVITIES AND DOUBLE TAXATION RELIEF (20%) (a) (b) (c) (d) (e) (f) (g) (h) (h) 4. Administration of CGT Act Nature and objectives of capital gains tax. Allowable and disallowable expenditures and computation of chargeable gains. Exemptions from capital gains tax. Computation of tax liabilities of various companies including down stream operations under CITA 1979 (as amended) Planning for direct and indirect tax savings Critical review of tax avoidance schemes Pioneer legislation Double taxation relief Tax implication of mergers, acquisitions and take-over bids Concepts and applications of deferred taxation Tax distortion under inflationary conditions Tax distortion under inflationary conditions TAX PRACTICE AND ADMINISTRATION (20%) (a) (b) (c) (d) (e) (f) (g) Nature and purpose of revenue enquiry Revenue Department’s procedures Ethical issues – implication of confidentiality, conflict of interest and disclosure of information on tax practice Tax audit and investigation Interpretation of tax laws using decided cases Communication skills Tax effects of privatization and commercialization 97 (h) (i) 5. FISCAL POLICY (a) (b) (c) (d) (e) (f) (g) 6. The incidence, allocative, distributional and stabilization effects of different forms of taxation and current expenditure in Nigeria and the implication of all these to her membership of ECOWAS. Case presentation before body of Appeal Commissioners. (10%) Public debt as an alternative to taxation-its causes and consequences. The macro-economic framework for national income analysis. The Keynesian model, stabilisation policies. The incidence, allocative, distributional and stabilisation effects of different forms of taxation and current expenditure in Nigeria and the implications of all these to her membership of ECOWAS. Public debt as an alternative to taxation - its causes and consequences. Assessment of public sector projects and services. Elements of cost and benefit analysis. Appraisal of public sector economic performance. Principles and practice of fiscal federalism. Fiscal capacity and needs in multi-level government structures Inter-governmental fiscal relations. Nigeria’s experience with revenue allocation. The theory and practice of grants in relation to state and local governments. CASE STUDY (20%) NOTES (1) (2) (3) (4) Candidates will be provided with tables of rates and allowances. Candidates should be conversant with relevant decided cases and statutory provisions. Candidates are expected to be conversant with annual budgetary provisions. New legislations and budgetary provisions shall become examinable after 6 months from the date of issue or enactment. 98 D. CONTACT HOURS: 60 E. RECOMMENDED TEXTBOOKS Adesola, S.M., Income Tax Law and Administration in Nigeria, Obafemi Awolowo University Press. Agyei, A. K., Capital Gains Tax, Graham Burn. Akawe, O., The Power to Tax and Federalism in Nigeria, Centre for Business and Investment Studies, Lagos. Ani, A. A., et al., Companies Income Tax and Petroleum Profit Tax in Nigeria, UPL. Ariwodola, J. A., Companies Taxation in Nigeria, JAA Nigeria Limited. CITN, Nigerian Tax Laws. CITN Tax guide & Statistic Federal Inland Revenue Service, Annual Budget of Fed. Republic of Nigeria Musgrave, R. A. and Musgrave, P. B., McGraw-Hill, New York. Public Finance in Theory and Practice, Ola, C. S., Nigerian Income Tax Law and Practice, CSS Ltd., Lagos. Oremade, B. T., Petroleum Profits Tax in Nigeria, Evans Brothers, Ibadan. Shaw, G. K. and Peacock, A.T., The Economic Theory of Fiscal Policy, London, Allen and Unwin. Uche¸R. U., Petroleum Accounting and Taxation in Nigeria, Alexander Books Associates, Oakland, California Joint Tax Board, Decided Cases by the Body of Appeal Commissioners. 99 21.5.4 PAPER 19 MULTIDISCIPLINARY CASE STUDY A. AIM To instil in the candidates the requisite communication and analytical skills, and ability to use knowledge gained from various courses to analyse different aspects of a case presented and proffer appropriate solutions consisting of possible alternative courses of actions and assessing their merits and demerits, costs and benefits and recognizing implementations or interface with other problems. OBJECTIVES B. Update, evaluate and integrate the knowledge and skills acquired Develop professional solutions to business problems involving skills in judgment Report solutions to business problems in an appropriate manner Evaluate business plans and appraise the related strategy from all stakeholders’ perspectives Tailor advice appropriate to the business scale and sector Give value added advice on business improvements Advise on the developments of improved financial structures Exercise ethical judgment. LINKAGES This paper is linked to ALL subjects at all levels of the examination. However, the examination in this paper requires the application of the principles, concepts, tools and techniques acquired throughout the study for the Institute’s examination as covered in this syllabus. The paper will be a five and a half hour paper divided into two sections. Candidates are expected to spend the first two hours reading the case. This will be followed by a 30 minutes break after which candidates are expected to spend three hours answering the questions (i.e sections A and B). SECTION A: (40 Marks) - A number of compulsory multiple choice and short answer questions covering the entire syllabus. SECTION B: (60 Marks) - Case Study questions. All questions related to the case are to be answered. 100 C. CONTENTS 1. INTRODUCTION Examination in this paper consists of analysis of information pertaining to a typical organizational problem and the presentation, with adequate justification, of a recommended course of action. Candidates will be required to study the brief provided carefully, analyse the information provided therein, develop alternatives and propose a realistic course of action. This paper draws on the knowledge and skills acquired by candidates from the various subjects featured in the entire syllabus as well as from their work experience. The case presented would be realistic and stimulate a real life situation and also span several of the distinct skill areas of accountancy and management practice. Consequently, candidates will be called upon to adopt a holistic perspective in proffering their solution. 2. REQUIREMENTS Candidates must endeavour to: 3. (a) understand that the case is a pseudo practical. (b) identify and draw out the salient information, which is germane to the problem in hand and make realistic assumptions in respect of those areas where inadequate information is given in the brief (c) choose analytical techniques, which are appropriate to the resolution of the problem (d) recognize and develop appropriate responses to the ethical issues raised in the problem (e) understand clearly the pertinent issues at play in the case (f) communicate effectively findings, solutions and recommendations. (g) make judgment concerning the efficient use of the time available for the analysis and presentation of the recommended solution OTHER AREAS OF SYLLABUS COVERAGE Candidates may be examined in all subjects of papers 1-18 including the following: (a) Corporate Plan (i) objectives and goals (ii) performance Indicators (iii) evaluate Corporate Strategy 101 b) Corporate Strategies and Management (i) (ii) (iii) (iv) (v) (vi) (vii) (viii) (ix) (x) (c) Business Improvement (i) (ii) (iii) (iv) (v) (vii) Project Evaluation Management Business Processes Change Management Competitive Skills Negotiation Skills Forecasting (d) Management of Financial Structure (i) Balance Sheet Management (ii) Finance and Treasury Solutions (iiv) Tax Planning and Fiscal Policy Issues (e) Ethical Issues (i) (ii) (iii) (iv) D. Organisational Structure and Strategy Corporate Governance Business Risk Identification, Evaluation and Management Product Portfolio Analysis Operations Management and Controls Human Resources Strategy & Management Marketing Strategy Information Technology Management of Intellectual Capital Business Restructuring, re-organizations, Mergers Acquisitions Interpersonal Relationship Management Style and Leadership Culture Members Codes of Conduct The Accountants, Laws and regulations. General Business ethics Global view/ethical considerations. (f) Decision Making Techniques and Tools (g) Operations Research (h) Accounting Policies and Standards (i) Communication Skills CONTACT HOURS: 75 102 and