Sunday 9 August 2015

CPA Syllabus- Section 3&4









PART II
SECTION 3
PAPER NO.7 COMPANY LAW
GENERAL OBJECTIVES
This paper is intended to equip the candidate with knowledge, skills and attitudes that will enable him/her to apply the provisions of company law in the formation, composition, operation and distribution of a company
7.0 LEARNING OUTCOMES
A candidate who passes this paper should be able to:
·         Apply legal principles relating to formation of companies
·         Evaluate the rights and obligations of members and shareholders
·         Comply with the legal principles governing corporate insolvency and restructuring
·         Comply with the legal principles relating to companies incorporated outside Kenya
·         Ensure books of accounts are prepared in compliance with the law
CONTENT
7.1 Nature and classification of companies
-          Types of companies
-          Nature and characteristics of a company
-          Classification of companies
-          Principle of legal personality and veil of incorporation
-          Distinction between companies and other forms of business associations
7.2 Formation of companies
-          Promoters and pre-incorporation contracts
-          Process of forming a company
-          Memorandum and articles of association
-          Certificate of incorporations
-          Legal consequences of
incorporation
7.3 Membership of a company
-          Rights and liabilities of members
-          Cessation of members

7.4 Shares
-          Classes of shares
-          Variation of class rights
-          Share warrants and certificates
-          Issue and allotment
-          Transfer and transmission
-          Mortgaging and charging of shares
7.5 share capital
-          Meaning and types of share capital
-          Raising of share capital
-          Prospectus/Information memorandum
-          Maintenance and Alteration of capital
-          The purchase by a company of its own shares
-          Financial assistance by a company for purchase of its shares
-          Dividends
7.6 Debt Capital
-          Borrowing powers of a company
-          Debentures
-          Charges
-          Registration of charges
-          Remedies for debenture  holders
7.7 Company meetings
-          Nature and classification of company meetings
-          Essentials of meetings
-          Proceedings at meetings
-          Voting
-          Resolutions
-          Minutes
7.8 Directors
-          Qualification and disqualification
-          Appointment of directors
-          Powers and duties of directors
-          Removal and vacation of office
-          Register of directors
-          Loan to directors
-          Compensation for loss of office
-          Disclosure of director’s interest in contracts
-          The rule in Turquand’s case/indoor management rule
-          Insider trading
7.9 The company secretary
-          Qualification, appointment and removal
-          Powers and duties of the company secretary
-          Liability of the company secretary
-          Register of secretaries
7.10 Auditors
-          Qualification, appointment and removal
-          Remuneration of Auditors
-          Powers and duties
-          Rights and liabilities
7.11 Company accounts, audit and inspection
-          Books of accounts
-          Form and content of accounts
-          Group accounts
-          Director’s report
-          Auditor’s report
-          Investigation of company affairs
-          Appointment and powers of inspectors
-          Inspector’s report
-          Annual returns
7.12 corporate Restructuring
-          Need for restructuring
-          Mergers, Take-Over’s and acquisition
-          Post Merger reorganization
-          Schemes of arrangement and comproises
-          Restruction
7.13 Corporate Insolvency
-          Meaning of insolvency
-          Types of winding up
-          Appointment, powers and duties of liquidators
-          Release of liquidators
-          Rights of parties in winding up
-          Distribution of assets
-          Offences relating to liquidation
7.14 companies incorporated outside Kenya
-          Process of registering a company in Kenya
-          Certificate of registration
-          Power to hold land
-          Registration of charges
-          Accounts of foreign companies
-          Service of process and notices on foreign companies
-          Returns
-          Cessation of business
-          Penalties
7.15 Emerging Issues and trends


PAPER NO. 8  FINANCIAL MANAGEMENT
GENERAL OBJECTIVES
This paper is intended to equip the candidate with the knowledge, skills and attitudes that will enable him/her to apply financial management techniques in business.
6.0 LEARNING OUTCOMES
A candidate who passes this paper should be able to:
·         Analyse the source of finance for an organization
·         Evaluate various investment decision scenarios available to an organization
·         Appraise the performance of a business using financial tools
·         Evaluate the current developments in business financing strategies
·         Formulate the capital structure for a firm
·         Determine the future value of a firm
CONTENT
8.1 Overview of financial management
-          Nature and scope of finance
-          Role of finance manager
-          Finance functions
-          Goals of a firm
-          Agency theory concept, conflict and resolutions
-          Measuring managerial performance, compensation and incentives
8.2 sources of funds
-          Factors to consider when selecting source of finance
-          Long term and short term source of funds
-          External and internal sources of funds
-          Sources of funds for small business enterprises
8.3 Financial markets
-          Nature and role of financial markets
-          Classification of financial markets: primary markets and secondary markets; money markets and capital markets
-          The stock exchange listing and cross listing
-          Market efficiency: efficient market hypothesis
-          Stock market indices
-          The financial institutions and intermediaries
-          The role of capital market authority
-          The central depository system (CDS)
8.4 The value of money
-          Concept of time value of money
-          Compounding techniques
-          Discounting techniques
-          Loan amortization schedule
8.5 Valuation concepts in finance
-          Concept of value: market value, book value, replacement value, intrinsic value
-          Valuation of fixed income securities
-          Valuation of shares
-          Valuation of companies
-          Valuation of unit trusts
-          Valuation of mutual funds
8.6 cost of capital
-          The concept and significance of cost of capital
-          Factors influencing cost of capital
-          Components of capital
-          Weighted average cost of capital (WACC)
-          Marginal cost of capital (MCC)
-          Capital structure and financial risk
-          Factors influencing capital structure decisions
8.7 capital investment decisions under certainty
-          Nature of capital investment decisions
-          Categories of capital projects
-          Capital budgeting techniques certainty:  non discounted cash flow techniques(Accounting rate of return (APR), payback period, discounted cash flow techniques (net present value (NPV), internal rate if return (IRR), discounted payback period, and profitability index (PI): NPV profile; comparison of the NPV and IRR methods when evaluating independent and mutually exclusive projects; problems associated with each of the evaluation methods
-          Expected relations among an investment’s NPV, company value, and share price
-          Determination of cash flows for investment decision
-          Incremental approach for cash flows estimation
-          Capital rationing: evaluation of capital projects and determination of the optimal capital project in situations of capital rationing for a single period rationing
8.8 measuring business performance
-          Users of financial statements and their information needs
-          Nature of financial ratio analysis
-          Types of financial ratios
-          Limitations of ratios analysis
-          Common size statements
-          Financial planning and forecasting
8.9 working capital management
-          Introduction to working capital management
-          Importance of working capital management
-          Factors affecting working capital needs
-          The working capital cycle
-          Working capital policies
-          Management of cash , inventory, debtors and creditors
8.10 Dividends policy
-           Forms of dividends
-          Dividends policies  and factors influencing dividend policies
-          Dividend theories
8.11 Islamic Finance
-          Justification for Islamic finance: history of Islamic finance; capitalism; halal; haram; riba; gharar; usury
-          Principles underlying Islamic finance: principles of not paying or charging interest, principles of not investing in forbidden items e.g. alcohol, pork, gambling or pornography; ethical investing; moral purchases
-          The concept of interest (riba) and how returns are made by Islamic financial securities
-          Sources of finance in Islamic financing: muhabaha, sukuk, musharaka, mudaraba
-          Types of Islamic financial products: -sharia-compliant products: Islamic investment funds; tafakul the Islamic version of insurance Islamic mortgage, murabahah, ; leasing-ijara; safekeeping-wadiah; sukuk-islamic bonds and securitization; ; sovereign sukuk; Islamic investment funds; join venture-musharaka, Islamic banking, Islamic contracts, Islamic treasury products and hedging products, Islamic equity funds; Islamic derivatives
-          International standardization /regulations of Islamic finance: case for Islamic financial services board
8.12 Emerging issues and trends

PAPER NO. 9 FINANCIAL REPORTING
GENERAL OBJECTIVES
This paper is intended to equip the candidate with the knowledge, skills and attitudes that will enable him/her to prepare financial statements for various entities and account for specialized transactions in both the public and private sectors
9.0 LEARNING OUTCOMES
A candidate who passes this paper should be able to:
·         Account for various assets and liabilities
·         Prepare financial statements including published financial statements for various types of organizations
·         Account for specialized transactions
·         Prepare group financial statements
·         Apply international financial reporting standards (IFRSs) and international Public Sector Accounting Standards (IPSASs) in preparing non-complex financial statements
CONTENT
9.1 assets and liabilities
-          Assets and liabilities covered in paper no. 1: Financial Accounting still examinable(  in the context of published financial statements)
-          Borrowing costs
-          Investment property
-          Financial Instruments (presentation, recognition, classes, measurement, de-recognition and disclosures) excluding impairment, hedging and embedded derivatives)
-          Leases (all aspects including dealers and sale and lease back)
-          Income tax (current and deferred tax but not deferred tax in the case of groups)
-          Provisions, contingent liabilities and contingent assets
9.2 Further aspects of partnerships
-          Dissolutions (including piece-meal)
-          Conversion of a partnership into a company
9.3 special transactions
-          Contracts with customers (revenue recognition). Hire purchase/instilment sales (split of hire purchase profit into interest and gross profit and using actuarial method and sum of digits to account for interest); sale of goods, construction contracts and real estate, provision of services
9.4 Financial statements for various types of businesses
-          Farming
-          Insurance
-          Banks
-          Professional firms (lawyers and accountants)
-          Independent local, dependent and foreign branches
-          Co-operative societies
9.5 published financial statements
-          Presentation of financial statements (income statement, statement of comprehensive incomes, statement of changes in equity, statement of financial position and the notes to financial statements)
-          Accounting policies, changes in accounting estimates and errors (prior period errors)
-          Events after the reporting period
9.6 subsidiaries (groups), associates and jointly controlled entities
-          Accounting for one subsidiary (consolidated income statement, consolidated statement of financial position and statement of cash flows-group financial statements); consolidated statement of cash flows also covers associate of subsidiaries during the year
-          Accounting treatment of associate companies
-          Jointly controlled entity
9.7 Financial statements under IPSASs
(Provisions of the following IPSASs (emphasis on distinctions with equivalent IASs/IFRs)
-          Presentation of financial statements
-          Accounting policies, changes in accounting estimates and errors
-          Borrowing costs
-          Consolidated and separate financial statements
-          Investments in associates
-          Interests in joint ventures
-          Events after the reporting date
-          Construction contracts, leases and inventories
-          Provisions, contingent liabilities and contingent assets
9.8 Emerging issues and trends



PART II


SECTION 4
PAPER NO. 10 AUDITING AND ASSURANCE
GENERAL OBJECTIVES
This is intended to equip the candidate with knowledge, skills and attitudes that will enable him/her to conduct the audit of an entity
10.0 LEARNING OUTCOMES
A candidate who passes this paper should be able to:
·         Plan an audit assignment
·         Comply with the regulatory framework during an audit assignment
·         Obtain audit evidence and use the work of others to meet audit objectives
·         Asses audit risk
·         Executes an audit assignment and prepare an audit report
CONTENT
10.1 Assurance engagement
-          Definition and objectives
-          Elements of an assurance engagement
-          Types of assurance engagements
-          Levels of assurance and reports
-          Non-assurance engagements
10.2 Nature and purpose of an audit
-          Nature and objectives
-          Audit as an assurance engagement
-          Development of an audit (early audit and modern audit)
-          Types of audit and limitations
10.3 legal framework and regulation
-          Regulatory framework within which external audits take place
-          Statutory regulation; auditors’ liability, appointment, removal, remuneration, resignation, rights and duties of auditors
-          International standards on auditing and other regulations
-          Professional ethics/code of ethics for professional accountants
-          Fundamental principles, threats and safeguards other professional guidelines on audit fees, conflict of interest, advertising and opinion shopping
10.4 planning and risk assessment
-          Obtaining clients acceptance and retention
-          Understanding the entity and its environment
-          Audit planning, audit programmes and documentation
-          Assessing audit risks
-          Errors, fraud and other irregularities
10.5 overview of forensic accounting
-          Nature, purpose and scope of forensic accounting
-          Types of forensic investigations: corruption asset misappropriation, financial statement fraud, others
-          Fraud prevention and deterrence
10.6 internal control system
-          Internal controls theory and practice
-          Evaluation of internal control system and test of control
-          Communication of internal control system (management letter)
-          Information technology threats and control
10.7 Audit evidence
-          Financial statement assertions and audit evidence
-          Audit sampling and other means of testing
-          The audit of specific  items (income/expenses/assets/liabilities)
-          Using the work of others (internal audit and experts)
-          Computer assisted audit techniques
10.8 overall audit review
-          Subsequent events review
-          Going concern review
-          Contingencies and commitments
-          Management representations
-          Quality control and review
-          Role of auditors in receiverships and liquidation
10.9 audit reports
-          7th schedule provisions on audit reports
-          Basic elements
-          Types of opinions
-          Emphasis of master paragraph
-          Features of audit reports
10.10 auditing in the public sector
-          Introduction to auditing in the public sector; regulatory provisions
-          Establishment, mandate and functions of public sector auditors; Kenya
-          National Audit Office (KENAO) and similar national audit bodies
-          Role of internal audit function in the public entities
-          Relationship between external and internal auditors in the public sector
-          International standards on supreme auditing institutions
10.11 Emerging issues and trends
 

  
PAPER NO. 11 MANAGEMENT INFORMATION SYSTEM
GENERAL OBJECTIVES
This paper is intended to equip the candidate with knowledge, skills and attitudes that will enable him/her to apply information communication technology (ICT) to enable business and other operations
11.0 LEARNING OUTCOMES
A candidate who passes this paper should be able to:
·         Effectively use ICT facilities in an organization
·         Apply the knowledge of ICT strategy and its role in facilitating competitive advantage in business
·         Use data communication networks, the internet and e-commerce in optimizing business opportunities
·         Implement information system’ security, controls and social ethical issues required in a  business environment
·         Implement ICT governance and risk management and principles in business

CONTENT
11.1 Introductions to information Communication technology
-          overview of computer system
-          computer hardware
-          computer software
-          programming language
-          ICT personal and information communication technology hierarchy
-          Role of ICT in business environments
-          Information centres
-          Factors that impact on ICT
11.2 ICT governance
-          Corporate governance and ICT governance
-          Monitoring of controls and risks
-          Policies and procedures
-          ICT management practices
-          Impact of ICT compliance with professional standards and codes


11.3 System development
-          General systems theory
-          Role of management in system development
-          System development approaches
-          System development lifecycle
-          Rapid applications development
-          Business process re-engineering
-          System development constraints
-          Acquisitions of ICT assets

11.4 Information system in an enterprise
-          Components of an information system
-          Types of an information system
-          System in a functional perspective
-          Enterprise applications and the business process integration
-          Outcome measure measurement of ICT infrastructure
11.5 information systems architecture
-          Nature and types of information
-          Attributes of information
-          Files and file structure
-          File organization and methods
-          Database management systems
-          Characteristics, importance and limitations of database systems
-          Data ware housing
-          Transaction processing phases in business systems
-          File processing modes
11.6 data communication and computer networks
-          Principles of data communication and computer networks
-          Data communication devices
-          Data transmission characteristics
-          Types of networks
-          Network topologies
-          Network/internet protocols
-          Benefits and challenges of networks in an organization
-          Limitations of networks in an organization
-          Cloud computing
-          Internet of things
11.7 e-commerce
-          Impact of the internet on business
-          Models of e-commerce
-          E-commerce enabling software
-          Business opportunities in e-commerce
-          Challenges of e-commerce
-          Mobile computing
11.8 information system strategy
-          Overview of business strategy hierarchy
-          The strategic process and information system planning
-          Development of information system strategy
-          Aligning information systems to the organization’s corporate strategy
-          Managing information systems strategy
-          Information systems for competitive advantage
11.9 ICT Risk management
-          Risk management overview
-          Risk assessment and analysis methodologies
-          Controls and countermeasures
-          Risk monitoring and communication
-          Disaster recovery and business continuity planning
-          Information systems security management
11.10 legal, ethical and social issues in management information systems
-          Management information systems ethical and social concerns
-          The moral dimension of management information systems
-          The legal issues in management information systems
11.11 Emerging issues and standards






PAPER NO. 12   QUANTITATIVE ANALYSIS
GENERAL OBJECTIVES
This papers is intended to equip candidates with knowledge, skills and attitudes that will enable him/her to use quantitative analysis tools in business operations and decision making
12.0 LEARNING OBJECTIVES
A candidate who passes this paper should be able to:
·         Use mathematical techniques in solving business problems
·         Apply set theory in business decision making
·         Apply operational research techniques in decision making
·         Apply simulation techniques in analyzing situations
CONTENT
12.1 Basic mathematical techniques
21.1.1 Functions
-          Functions, equations and graphs: linear, quadratic, cubic, exponential and logarithmic
-          Application of mathematical functions in solving business problems
12.1.2 Matrix algebra
-          Types and operations (addition, subtraction, multiplication, transposition, and inversion)
-          Application of matrices; statistical modeling, Markov analysis, input-output analysis and general applications
12.1.3 Calculus
-          Differentiation
·         Rules of differentiation (general rule, chain, product, quotient)
·         Differentiation of exponential and logarithmic functions
·         Higher order derivatives: turning points (maxima and minima)
·         Ordinary derivatives and their applications
·         Partial derivatives and their applications

-          Integration
·         Rules of integration
·         Application of integration to business problems

12.2 Probability
            12.2.1 Set theory
-          Types of sets
-          Set description: Enumeration and descriptive properties of sets
-          Operations of sets: Union, intersection, complement and difference
-          Venn diagram
12.2.2 Probability theory and distribution
            Probability theory
-          Definition: Event, outcome, experiment, sample space
-          Types of events: Elementary, compound, dependent, independent, mutually exclusive, exhaustive, mutually inclusive
-          Law of probability: Additive and Multiplicative rules
-          Baye’s Theorem
-          Probability trees
-          Expected value, variance, standard deviation and coefficient of variation using frequency and probability
            Probability distribution
-          Discrete and continuous and continuous probability distributions (Uniform, normal, binomial, Poisson and exponential)
-          Application of probability to business problems
12.3 Hypothesis testing and estimation
-          Hypothesis tests on the mean (when population standard deviation is unknown)
-          Hypothesis tests on proportions
-          Hypothesis tests on the difference between means(independent sample)
-          Hypothesis tests on the difference between means (matched pairs)
-          Hypothesis tests on the difference between two proportions
12.4 correlation and regression analysis
Correlation analysis
·         Scatter diagrams
·         Measures of correlation-product moment and rank correlation coefficients (pearson and spearman)

Regression analysis
·         Sample and multiple linear regression analysis
·         Assumption of linear regression analysis
·         Coefficient of determination, standard error of the estimate, standard error of the slope , t and F statistics
·         Computer output of linear regression
·         T-ratios and confidence interval of the coefficients
·         Analysis of variance (ANOVA)
12.5 Time series
-          Definition of time series
-          Components of time series (circular, seasonal, cyclical, irregular/random, trend)
-          Application of time series
-          Methods of fitting trend: free hand, semi-averages, moving averages, least squares method
-          Models-additive and multiplicative models
-          Measurement of seasonal variation using additive and multiplicative models
-          Forecasting  time series value using moving averages, ordinary lest squares method and exponential smoothing
-          Comparison and application of forecasts for different techniques
12.6 linear programming
-          Definition of decision variables, objective function and constraints
-          Assumptions of linear programming
-          Solving linear programming using graphical method
-          Solving linear programming using simplex method
-          Sensitivity analysis and economic meaning of shadow prices in business situations
-          Interpretation of computer assisted solutions
-          Transportation and assignment problems
12.7 Decision theory
-          Decision process
-          Decision making environment-deterministic situations (certainty), analytical hierarchical approach (AHA), risk and uncertainty, stochastic situations (risks), situations of uncertainty
-          Decision making under uncertainity -maxmin, maxmax, minimax regret, Hurwicz decision rule, Laplace rule
-          Decision making under risk-expected monetary value, expected opportunity loss, minimizing risk using coefficient of variation, expected value of perfect information
-          Decision trees- sequential decision, expected value of sample information
-          Limitations of expected monetary value criteria
12.8 Game theory
-          Assumptions of game theory
-          Zero sum games
-          Pure strategy games (saddle point)
-          Mixed strategy games (joint probability approach)
-          Dominance, graphical reduction of a game
-          Value of the game
-          Non zero sum games
-          Limitations of game theory
12.9 Network planning and analysis
-          Basic concepts- network, activity, event
-          Activity sequencing and network diagram
-          Critical path analysis (CPA)
-          Float and its importance
-          Crashing of activity/project completion time
-          Project evaluation and review technique (PERT)
-          Resource scheduling (leveling) and Gantt charts
-          Limitations and advantages of CPA and pert
12.10 Queuing theory
-          Components/elements of a queue: arrival rate, service rate, departure, customer behavior, service discipline, finite and infinite queues, traffic intensity
-          Elementary single server queuing systems
-          Multiple server queues
12.11 Simulation
-          Types of simulation
-          Variables in a simulation model
-          Construction of a simulation model
-          Monte Carlo simulation
-          Random numbers selection
-          Simple  queuing simulation: single server, single channel “ first come first served” (FCFS) model
-          Application of simulation models

12.12 current developments
-          Role of advancement in information technology in solving quantitative analysis problems
12.13 Emerging issues and trends





No comments:

Post a Comment