1. (a)
“Analysis of financial statements is affected by window dressing and bias
motive of the analyst.” Explain. Also define the tools used for analysing the
financial statements. 7+7=14
Or
(b) Write short notes on the
following: 3.5x4=14
(i) Purpose of analysis of
financial statements
(ii) Limitation of analysis of
financial statements
(iii) Distinction between common
size statements and financial statements
(iv) Adoption of Indian GAAP in preparation
of financial statements
2.
(a) From the following information presented by
BCPL Ltd. For the year ended 31 – 12 – 2010, prepare balance sheet: 14
Sales to net
worth 5times
Current liabilities
to net worth 50%
Total debts to
net worth 60%
Fixed assets
to net worth 60%
Current ratio 2
: 1
Sales to stock 10
times
Debtor’s
velocity 9
times
Annual sales Rs.
1500000
40% of sales
were made on cash.
Or
(b) Discuss the
significance of the following: 3.5x4=14
(i) Current
ratio
(ii) Debtor’s
turnover ratio
(iii) Debt –
Equity ratio
(iv) Return on
investment
3.
(a) Discuss the qualitative characteristics
which make financial reporting useful. “Financial reporting should be a part of
annual report of the companies.” Explain.
7+7=14
Or
(b) What are the provisions of AS
25 with regard to recognition and measurement related to interim financial
reporting? How does interim financial reporting differ from segment
reporting? 7+7=14
4. (a)
How should social accounting information be reported in published annual
reports? Distinguish between financial statement related for general price –
level changes and current value financial statements. 7+7=14
Or
(b) Disclosure of corporate
governance practices followed by indian companies in their published annual
reports is the best way to provide information to its shareholders. Comment. 14
5.
(a) “ Accounting standards are something less
than the law but more than the professional guidelines.” Elaborate the
statement indicating importance of accounting standards. Do you agree with the
decision of ICAI of convergence with IFRS w.e.f. april, 2011 for Indian companies?
Justify you reasons. 7+7=14
Or
(b) Distinguish between the terms “harmonization”
and “Standardisation”. Outline few suggestions that have been made by the RBI’s
advisory group on accounting and auditing for financial institutions including
NBFC. 4+10=14