SPECIALIZED TRAINING PROGRAM

(STP)

Revised Syllabus (FPOE-2018-19)

 M SPECIALIZED TRAINING PROGRAMME
45th STP
SYLLABUS
FINAL PASSING OUT EXAMINATION
INDEX

With/
Without
Sr. No Subject / Paper Marks Time Book

Financial Management & Quantitative Without

1 Techniques 150 3.5 Hours Book

Without
2 Financial Accounting 100 3 Hours Book

New Accounting Model & Financial Audit

3 Manual 150 3.5 Hours With Book

Without
4 Cost and Management Accounting 100 3 Hours Book

5 Service and Financial Rules 150 3 Hours With Book

Business Law and Taxation (With Book for With Book

6 Income Tax Ordinance 2001 and Sales Tax Act) 100 3 Hours (Tax)

Without
7 Communication Skills 100 3 Hours Book

Without
8 Information Systems Audit 150 3 Hours Book

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Paper 1 (150 MARKS)
Financial Management & Quantitative Techniques
Total Credit Hours: 100

INTRODUCTION
The aim of the syllabus is to provide a basic understanding of the conceptual principles, the
relationship between sources of finance and financial management. The candidates are
expected to have an understanding of the preparation, evaluation and implementation of
business plans and reports. This syllabus will provide knowledge of basic mathematics,
including formulae and ratios, Techniques for summarizing and analyzing data and use of
probability where risk and uncertainty exist.
It will also familiarize students with basics of public financial management, such as theory of
public finance, sources of revenue, and types of expenditure, planning, budgeting, medium
term budgetary framework and public debt.

SYLLABUS WEIGHTAGE

Financial Management & Quantitative Techniques

Quantitative Techniques (SECTION-A)
1 Basic Mathematics
2 Presentation of Data 27%
Summarizing and analyzing data(excluding probability and non-
3 probability)
4 Financial Mathematics
Financial Management (SECTION-B)
1 Objectives of organization
2 Financial Markets
3 Short, Mid-Term Finance and Long term Finance 40%
4 Capital Investment Appraisal
5 The cost of capital
Public Sector Financial Management (SECTION-C)
1 Introduction to public Finance
2 Types of Public Revenue
3 Public expenditure
4 Public Budget 33%
5 Public debt
6 Fiscal Policy and Monetary policy
7 Policy Planning and Role of Development Institution
Total 100

 The weights assigned against each section are meant for the paper setter.
 The examination paper will consist of thirteen questions divided into three sections
A, B & C. Section A and section C will have 4 questions each and section B will
consist of 5 questions.
 Each question of section A and section B will carry 20 marks whereas each question
of section C will carry 25 marks.

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  Probationary officers will attempt 7 questions in total which shall be attempted in
the following order.

I. Two questions out of four from Section A

II. Three questions out of five from Section B
III. Two question out of four from Section C

SUGGESTED READING LIST:

1. Strategic Financial Management (ICMA- F-3) 503

2. Foundation in Financial Management (Interactive Text, 2012)
3. Fundamentals of Financial Management by James C.Van Horne (13thEdition)
 Discount factor tables as reference material may be provided to the candidates if needed
4. Business Mathematics by CIMA
5. Statistics theory and method by Dr. Afzaal Baig
6. Business Mathematics by Mirza & Mirza
7. Public Finance by HL Bhatia (28th Edition)
 Economic Survey of Pakistan
 Budget documents (MTBF) Teacher’s Handouts as reference
 State Bank Annual Report (Monetary Policy)
 Hand Book of Planning Commission (Planning)
 Case Studies on Public Finance of Pakistan

Financial Management & Quantitative Techniques

Sr. No. (SECTION A)
DETAILED CONTENTS
1 Basic Mathematics
 Use of Formulae
 Percentages and ratios
 Rounding of numbers
2 Presentation of data
 Data and information
 Primary and secondary data
 Tabulation of data.
 Frequency distributions
3 Summarizing and analyzing data
 Graphs and diagrams, bar charts, time series Graphs (not Z charts), scatter
diagrams, histograms and gives. Summary measures for both grouped and
ungrouped data.
 Co-efficient of variation
 Index numbers.
4 Financial mathematics
 Simple and compound interest
 Discounting to find the present value
 Annuities and perpetuities
 Loans and mortgages
 Sinking funds and savings funds
 Simple investment appraisal
 Marketable Securities: Prices and Interest Rates
 Certificates of Deposits
 Bills of Exchange
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  Ordinary Shares / Preference Shares
 Loan Notes / Convertibles Warrants
 Other Commercial Stocks
(SECTION-B)
DETAILED CONTENTS
1 Objectives of Organization
 Objectives of Companies
 Stakeholders and objectives
 Objectives of Publicly owned and non-commercial bodies
 Financial management decisions
2 Financial Markets
Overview of Financial Markets(1)
 Introduction
 The Banking System
 Finance Markets
 The Stock Market
3 Overview of Financial Markets(2)
 Introduction
 Cash Investment
 Marketable Securities: Prices and Interest Rates
 Certificates of Deposits
 Bills of Exchange
 Ordinary Shares / Preference Shares
 Loan Notes / Convertibles Warrants
 Other Commercial Stocks
4 Short, Mid-Term and Long Term Finance
 Introduction
 Budgeting for borrowings
 The Banker/customer relationship
 Banks’ Criteria for Lending
 Overdrafts
 Medium and Long term loans
 Overdrafts and Loans Compared
 Leasing as a source of Finance
 Introduction (Long-Term Finance)
 Long-Term Finance and Capital Markets
 The Capital Structure Decision
5 Capital Investment Appraisal
 Introduction
 Steps in Project Appraisal
 Methods of Project Appraisal
 Accounting Rate of Return Method
 The Payback Period
 The Time Value of Money
 Discounted Cash Flow
 Internal Rate of Return
 Public Sector Capital Budgeting Decisions
6 The Cost of Capital
 Investment decisions, Financing and the Cost of Capital
 The Dividend Valuation Model

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  The Capital Asset Pricing Model(CAPM)
 The Cost of Debt
 The weighted Average Cost of Capital (WAAC)
(SECTION C)
DETAILED CONTENTS
1 Introduction to Public Finance
 Meaning and scope of Public Finance
 Traditional Principles of Public Finance
 Public Goods V/s Private Goods
 Externalities
 Concept of Mixed Economy.
2 Types of Public Revenue
 Revenue Receipts
 Capital Receipts
 Difference between tax revenue and non-tax revenue
 Kinds of tax
 Base of tax
 Buoyancy and Elasticity of a tax
 Principles of taxation
 Characteristics of a good tax system
3 Public Expenditure
 Meaning and Nature of Public Expenditure
 Wagner’s Law of Increasing State Activities
 Wiseman Peacock Hypothesis
 Kind of Public Expenditure
 Public Expenditure and Distribution.
 Effects of Public Expenditure
 Public Expenditure and Economy Stabilization
 Public expenditure and Economic Growth.
4 Public Budget Introduction
 Kinds of Budget
 Performance Budget
 Program Budget
 Zero Base Budget
 Balanced Budget
 Medium Term Budgetary Framework (MTBF)
 Pros & Cons of Budget.
5 Public Debt
 Internal Debt
 External Debt
 Burden of Debt
 Internal and External Factors
 Responsible for Public Debt
6 Fiscal Policy and Monetary Policy
 Role of Finance Division
 Role of State Bank of Pakistan
7 Policy Planning and Role of Development Institutions
 Planning Commission ( Federal level)
 Planning and Development Department (Provincial level)
 EDO Finance& Planning (District level)
 Preparation of Planning documents

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PAPER 2: (100 MARKS)
FINANCIAL ACCOUNTING
Total Credit Hours: 60

INTRODUCTION:

The course is designed to provide understanding of fundamentals of accounting theory,

methods and procedures as followed by different forms of business organizations and
commercial ventures. It systematically covers the accounting process of classification,
summarization, presentation and interpretation of historical data in the light of established
accounting practices and major forms of business organization i.e., partnerships and limited
companies. Application of principles set out by International Accounting standards in the
preparation of financial statements.
SYLLABUS WEIGHTAGE
FINANCIAL ACCOUNTING
SECTION-A
1 Accounting: Information for decision making

2 Basic Financial Statement

20 %
3 Analysis and Interpretation Financial Statements
4 Accounting Cycle

SECTION-B

5 Forms of Business Organization

6 Financial Assets
40 %
7 Inventories and Cost of Goods sold

8 Plant assets and Depreciation

SECTION-C

9 Liabilities

10 Stockholders’ equity; Paid in Capital

11 Income and changes in retained earnings 40 %

12 Reporting Cash in the Balance Sheet

13 Statement of Cash flows

Total 100%

 The weights assigned against each section are meant for the paper setter.
 The examination paper will consist of eight questions divided into three sections A, B &
C. Section A and section B will have 3 questions each and section C will consist of 2
questions.
 Probationary Officers will attempt five questions in total which shall be attempted in the
following order;
I. One question out of two from Section A

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 II. Two questions out of three from Section B
III. Two questions out of three from Section C

SUGGESTED READING LIST:

1. Accounting by MEIGS & MEIGS 13th Edition

Sr. No. FINANCIAL ACCOUNTING

DETAILED CONTENTS
1 Accounting information for decision making
Types of Accounting Information
Accounting Systems
o Determining Information Needs
o Cost of Producing Accounting Information
o Basic Functions of An Accounting System
Financial Accounting Information
External Users of Accounting Information
Objectives of External Financial Reporting
Use of Financial Statements by External Parties
Management Interest in Financial Statements
2 Basic Financial Statement
Introduction to financial statements
Statement of Financial Position – Balance sheet.
The Accounting Equation and Effects of Financial Transactions on the Equation
Income Statement
Statement of cash flows
Relationship among financial statement
3 Analysis and Interpretation Financial Statements
 Horizontal and vertical analysis
 Inter-firm and intra-firm comparisons through ratio analysis
 Limitations of ratio analysis
 Reports to the Managements (Restricted only to the interpretation of ratios)
4 Accounting Cycle
The ledger
The use of accounts
Debit and Credit entries
The Journal
Posting the Journal entries to Ledger & extracting Balance
Types of accounts Assets, Liabilities, Revenue, Expense and Owners’ Equity.
Trial Balance
Adjusting entries
Preparing Financial Statements
5 Forms of Business Organization
Sole proprietorship
Partnership
Corporations
6 Financial Assets
Cash
Accounts Receivable
7 Inventories and Cost of Goods sold
Flow of inventory cost
Taking a physical inventory
8 Plant assets and depreciation
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 Acquisition of plant assets
Depreciation
Disposal of plant and equipment
Intangible Assets
9 Liabilities
Current liabilities
Long term liabilities
Special types of liabilities
10 Stockholders equity; Paid in Capital
Corporations
Formation of corporation
Paid in capital of a corporation
Market value
Cash Balance & Corporate Dividends
11 Income and changes in retained earnings
Developing predictive information
Earnings per share
Cash Dividends
Stock Dividends
Statement of Retained Earnings.
12 Reporting Cash in the Balance Sheet
Cash Management
Reconciling the Bank Statements
13 Statement of Cash flows
Purpose of the statement
Classification of Cash Flows
Preparing a Statement of Cash Flow
Managing Cash Flows

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PAPER 3: (150 MARKS)
NAM & FAM (WITH BOOKS)
Total Credit Hours: 80

INTRODUCTION:
The aim of the syllabus is to ensure that students have knowledge of important elements and
concepts of NAM & FAM.
Section A provides knowledge and skills in budgetary controls, expenditure policies and
procedures and the system of receipts accounting. It imparts knowledge in Bank reconciliation,
Self-Accounting entities, and Financial Reporting procedures, Loss and Recoveries of Public
Money and Accounting for Liabilities in SAP environment. Provide knowledge in Transactions
between Government Entities, Procurement and Asset Management, Public Account
Transactions and Insurance along-with General Accounting in NAM, Use of Assignment and
Personal ledger accounts. It creates awareness pertaining to Salaries and wages, Pension and
General Provident Fund in NAM.
Section B is designed to provide students with a basic understanding of the nature and
objectives of an audit, basic principles and procedures involved in auditing and general
auditing practice. A familiarity of auditing techniques such as routine checking, vouching and
verification will be ensured. Students will be expected to have the knowledge of the
International Standards on Auditing and Auditing Practice Statements. An exposure to
computer assisted audit techniques i-e ACL software will be a part of the training. The
Probationers will be required to possess knowledge of the function and responsibilities of
Office of the Auditor-General of Pakistan.

SYLLABUS WEIGHTAGE
NEW ACCOUNTING MODEL
SECTION-A
1 Introduction and Overview of NAM concepts
2 Financial Reporting Procedures
3 Budgetary Controls
4 Expenditure
5 Receipts
6 Bank Reconciliation
7 Transaction between Government Entities
8 Public account Transactions 50%
9 Project Accounting
10 Assignment Accounts and personal ledger accounts
11 Loss and Recoveries of Public Money/ Insurance
12 Self-Accounting Entities
13 Liabilities and Asset Management
14 General Accounting
15 IPSAS Cash Basis (without computations)

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 FINANCIAL AUDIT MANUAL
SECTION-B
1 Organization and purpose of the Manual
2 Role of the Auditor-General
3 DAGP Audit Standards
4 DAGP’S Annual Planning Process
5 The Audit Cycle
6 Planning the Audit
7 Activity and resource planning for individual audits
8 Conducting the audit 50%
9 Evaluating audit results
10 Documentation and working papers
11 The reporting process
12 The Audit Report
13 Audit follow up
14 Quality Assurance
15 Hands on training , ACL (15 hours training-in house)
Total 100%
 The weightings given above are for the paper setter.
 The examination paper will consist of ten questions divided into two sections A and B. Section A
will consists of 5 questions and section B will consist of 5 questions.
 Probationary Officers will attempt six questions in total which shall be attempted in the following
order;
I. At least three questions out of five from Section A
II. At least three questions out of five from Section B

SUGGESTED READING LIST:

1. Accounting Policies and Procedures Manual by DAGP
2. Manual of Accounting Principles by DAGP
3. New Chart of Accounts by DAGP
4. IPSAS Cash Basis (without Computation)
5. Financial Audit Manual by the DAGP (2012 Edition)

Sr.# SECTION-A
DETAILED CONTENTS
1 Introduction and Overview of NAM concepts
 Organizational structure of the Accounting system
 The Accounting system
 Basic NAM definitions and abbreviations
 Chart of accounts and its elements (with practical exercises)
2 Financial Reporting Procedures
 Introduction to CGA ordinance
 General Policies
 Year-end accounting policies
 Detailed Procedure
3 Budgetary Controls
 Introduction
 General Procedures
 Detailed Procedures

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  Specific Budgetary Procedures
4 Expenditure
 Introduction
 General Policies
 Accounting Policies
 Accounting for Expenditure
 Detailed Procedure
 Salaries and wages
 Pension Payment
 General Provident Fund
 Contractor/Work Payments
 Loan and Advances
 Overseas Payments
 Grants-in-aid, Contributions etc.
 Assignment Account and Personal Ledger Account
 Maintenance of Permanent Accounting Records
5 Receipts
 Introduction
 General Policies 
 Accounting Policies
 Accounting for receipts
 Detail of Procedures
 Treatment of specific classes of receipt
6 Bank Reconciliations
 Introduction
 Overview
 General Policies
 Daily procedures
 Monthly Procedure
7 Transactions between Government Entities
 Introduction
 General Policies
 Accounting Policies
 Accounting for transactions between Government entities
 Detailed Procedures
8 Public Account Transactions
 Introduction
 General Policy
 Accounting Policy
 Detailed Procedures
 Reconciliation of Public Account Transactions
 Reporting of Public Account
9 Project Accounting
 Introduction
 General Policies
 Accounting Policies
 Accounting for Project Expenditure
10 Assignment Accounts & Personal Ledger Accounts
 Introduction
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  Policies
 Detailed Policies
 Appendix Account Transactions
11 Loss and Recoveries of Public Money/ Insurance
 Introduction
 General Policies
 Accounting for Losses and Recoveries
 Claims against the Government
12 Self-Accounting Entities
 Introduction
 General Policies
 Accounting Policies
 Accounting for Self-Accounting Entity transactions
 Detailed Procedures
13 Liabilities and Asset Management

 General Policies for Procurement
 Accounting for Stores
 Fixed Assets Management
 General Policies for Disposal of Fixed Assets
 Accounting for Proceeds from Disposals
 General Policy
 Categories of Liabilities
 Accounting Policies
 Accounting Procedures
 Reconciliation of Liability Records
 Reporting of Liabilities
14 General Accounting
 Introduction
 Retention of Accounting records
 Maintenance of Accounting Records
 Use of Suspense Account
 Control of official forms and cheque books
15 IPSAS Cash Basis (without computations)

SECTION-B
DETAILED CONTENTS
1 Organization and purpose of the Manual
 Purpose of the Audit Manual
 Types of audits dealt with
 Audit entities dealt with
 Accounting Responsibility Structure of the Government of Pakistan
 Stages of audit work dealt with
 Organization of the manual
 Links to other guidance material
 Standard audit working paper kit
 Need for professional judgment
 Updating the Audit Manual
2 Role of the Auditor-General

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  Parliamentary Control and Public Accountability
 Introduction to Auditing
 Legislative Basis
 Vision, Mission and Values
 Constitution’s Relevant Articles: 168-171 as amended
 AGP Ordinance especially focusing on Sec: 7,8,12 and 14
 Job of the Auditor
 Expectations
 Conditions of Employment
 Code of Ethics
 Protection of the Auditor
3 DAGP Audit Standards
 INTOSAI’S Professional Standards
 The International Standards of Supreme Audit Institutions (ISSAIs)
 Fundamental Auditing Principles
 Level-4-Auditing Guidelines (ISSAIs 1000-4999)
4 DAGP’S Annual Planning Process
 DAGP Strategic Audit Objectives
 DAGP Audit Scope
 DAGP Strategic Audit Plans
 Emerging areas of auditing
 The annual planning process
 Integration of audit work
 Approval process for the budget of centrally-led Audits
5 The Audit Cycle
 Introduction
 General planning
 Activity and Resource Planning
 Roles and responsibilities
6 Planning the Audit
 Introduction
 Step 1 –Establish audit objectives and scope
 Step 2 –Understand the entity business
 Step 3 –Assess materiality, planned precision, and audit risk
 Step 4 –Understand the entity internal control structure
 Step 5 –Determine components
 Step 6 –Determine financial audit and compliance with authority
objective, and error/irregularity conditions
 Step 7 –Assess inherent risk and control risk
 Step 8 –Determine mix of tests of internal controls, analytical procedures
and Substantive tests of details
 Reliance on other auditors
 Documenting the strategic planning decision
 Application to Government- wide Audits
7 Activity and Resource Planning for Individual Audits
 Introduction
 Formulate/update Audit Programs
 Updating staffing requirements and allocating resources
 Updating budget requirements
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  Updating timing considerations
 Factors to consider when determining the optimum timing.
 Updating information required from the entity
 Re-assessing the general and detailed planning Decision for
individual audit
 Documenting the detailed planning decision
 Updated planning file.
 Approval of the general and detailed planning decisions
8 Conducting the Audit
 Introduction
 Compliance Testing
 Substantive Testing Evidence
 Matters to deal with during field work
 Cause and Effect Analysis
 Developing conclusions and Recommendations
 Keeping entity official informed
 Documenting the work performed
 Custody and maintenance of working paper files
 Quality assurance during field work
9 Evaluating Audit Results
 Evaluating Financial Audit Results
 Known errors, most likely errors, further possible errors and maximum
possible error
 Determining the cause of errors, violations and deviations
 Concluding on the results of each test
 Concluding on the results of each component
 Concluding on the financial statements as a whole
 Dealing with unacceptable results
 Dealing with acceptable results
 Documenting the evaluation process
 Evaluating Regularity Audit Results
 Quality assurance during the evaluation phase
10 Documentation and Working Papers
 The Need for Documentation and Working Paper Files
 The Purpose of Working Paper Files
 The Quality of Working Paper Files
 Custody and Maintenance of the Working Paper Files
11 The Reporting Process
 Introduction
 Focus on the Reporting Process
 Clearing Observations, Conclusions and Recommendations
 Obtaining Management Responses
 Management representation letter
 Audit completion checklist
 Producing the Audit Report
 Review of reports by others
12 The Audit Report
 Introduction
 The certification report and types of opinion

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  Audit reports other than opinions on financial statement
 Reporting style and format
 Compliance and Performance Reports
13 Audit Follow Up
 Introduction
 Timing of the follow up
 Determining the desired level of assurance
 Performing the follow up
 Reporting the results of the follow up
 Performing additional follow ups
14 Quality Assurance
 Introduction
 General quality assurance techniques described in this manual
 Quality assurance during planning phases for individual audits
 Quality assurance during the field work phase for individual audits
 Quality assurance during the evaluation phase
 Quality assurance during the reporting phase
 Quality assurance during the follow up phase
 Other quality assurance procedures
| Hands on Training , ACL (15 hours training-in house) will be conducted
as an internal activity

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Paper 4 (100 MARKS)
Cost & Management Accounting
Total Credit Hours: 80

INTRODUCTION
This course is designed to acquaint students with knowledge of, established practices of cost
accumulation methods and the application of this knowledge to basic planning, control and
decision-making. The course covers job order, process costing and standard cost systems.
This course shall describe fundamentals of accounting for material, labour and manufacturing
expenses; an understanding of the role of cost accounting in planning and controlling
organizational and manufacturing cost and their relation to management functions.
SYLLABUS WEIGHTAGE
SECTION-A
1. Introduction to Management Accounting:
2. Cost classification
3. Material Costs 40%
4. Labour Costs
5. Overhead and Absorption Costing
6. Marginal and Absorption Costing
SECTION-B
7. Types of Costing System
8. Cost Behavior 25%
9. Standard Costing
10. Basic Variances Analysis
11 Budgeting: Profit, Sales, and Expenses
12 Budgeting: Expenditure & Cash 15%
13 Budgeting: The Flexible Budget; Cost Behavior Analysis.
SECTION-C
14 Cost-volume-profit (CVP) analysis
20%
15 Relevant costing and decision-making
Total 100%

 The weightages given above are for the paper setter.

 The examination paper will consist of eight questions divided in three sections A, B &
C. Section A and Section B will have 3 questions each and Section C will consist of 2
questions.
 Probationary officers will attempt five questions in total which shall be attempted in
the following order:

I. Two questions out of three from Section A

II. Two questions out of three from Section B
III. One question out of two from Section C

SUGGESTED READING LIST

1. ACCA, F2, Management Accounting, BPP Learning Media. (2010)

2. Cost Accounting, Planning and Control, Matz&Usry, Cengage Learning (7th Edition)

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Sr. No.
DETAILED CONTENTS
1 Introduction to Management Accounting:
Describe the purpose and role of cost and management accounting within an organization.
Compare and contrast financial accounting with cost and management accounting.
Outline the managerial processes of planning, decision making and control
Explain the difference between strategic, tactical and operational planning
Explain the limitations of management information in providing guidance for managerial decision-
making
2 Cost classification
Explain and illustrate production and non- production costs
Describe the different elements of non-production costs- administrative, selling, distribution and
finance
Describe the different elements of production cost- materials, labour and overheads
Explain the importance of the distinction between production and non-production costs when
valuing output and inventories
Explain and illustrate with examples classifications used in the analysis of the product/service
costs including by function, direct and indirect. fixed and variable, stepped fixed and semi variable
costs.
Explain and illustrate the concept of cost objects, cost units and cost centres
Distinguish between cost, profit, investment and revenue centres
Describe the differing needs for information of cost, profit, investment and revenue centre
managers
3 Material Costs
Procedure for materials procurement and use, Describe the different procedures and documents
necessary for the ordering, receiving and issuing of materials from inventory
Materials costing methods
Calculate the value of closing inventory and material issues using LIFO, FIFO and average
methods.
Identify, explain and calculate the costs of ordering and holding inventory (including buffer
inventory)
Calculate and interpret optimal reorder quantities
4 Labour Costs
Wage incentive plans; system and documentation
Calculate direct and indirect costs of labour Prepare the journal and ledger entries to record labour
cost inputs and outputs
Describe different remuneration methods: time-based systems, piecework systems and individual
and group incentive schemes
Calculate the level, and analyse the costs and causes of labour turnover
Explain and calculate labour efficiency, capacity and production volume ratios
5 Overhead & Absorption Costing
Absorption of factory overhead using Labour hours and Machine hours.(to be restricted to labour
and machine hours only)
Explain the different treatment of direct and indirect expenses
Describe the procedures involved in determining production overhead absorption rates
Reapportion service cost centre costs to production cost centres (including using the reciprocal
method where service cost centres work for each other)
Select, apply and discuss appropriate bases for absorption rates
Calculate and explain the under and over absorption of overheads
6 Marginal & Absorption Costing
 Explain the importance of, and apply, the concept of contribution

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  Demonstrate and discuss the effect of absorption and marginal costing on inventory valuation and
profit determination
 Calculate profit or loss under absorption and marginal costing
 Reconcile the profits or losses calculated under absorption and marginal costing
7 Types of Costing Systems
Job order costing, process costing and contract systems costing; and treatment of joint products
and by-products.
8 Cost behavior
Fixed and variable costs; direct and indirect costs; cost volume profit analysis and break even
analysis,
Describe and illustrate, graphically, different types of cost behaviour
Using high-low method, Use high/low analysis to separate the fixed and variable elements of total
costs including situations involving semi variable and stepped fixed costs and changes in the
variable cost per unit.
9 Standard Costing
Operation of Standard costing system
Establishing cost standards
Types of cost standards
10 Basic Variances Analysis
Material Variances (Total, Price and Usage Variances)
Labour Variances (Total, Wage Rate and Efficiency Variances)
Variable Overhead (Expenditure Variance and efficiency Variance
11 Budgeting: Profit, Sales, and Expenses
Profit Planning, Principles of Budgeting, and The complete Periodic Budget.
12 Budgeting: Expenditure & Cash
Capital Expenditures Budgets, Research and Development Budget, Cash Budget, Projected Income
Statement, Projected Balance sheet, Financial forecast for External Users, Zero Base Budgeting.
13 Budgeting: The Flexible Budget; Cost Behavior Analysis.
The flexible Budget, Capacity and volume, analysis of Cost Behavior, Determining the fixed and
Variable elements of a Semi variable Expense, Preparing a flexible budget, Flexible Marketing and
Administrative Budgets.
14 Cost-volume-profit (CVP) analysis
CVP analysis and breakeven point, The contribution to sales (C/S) ratio, The margin of safety,
Breakeven arithmetic and profit targets, Breakeven charts, contribution charts and
profit/volume charts, Limitations of CVP analysis
15 Relevant costing and decision-making
Relevant costs; make or buy decisions; decisions with limiting factors.

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 PAPER - 5: (150 MARKS)
SERVICE & FINANCIAL RULES (WITH BOOKS)
Total Credit Hour: 80

INTRODUCTION

This syllabus aims to ensure that the students acquire knowledge and skills in Service and
Financial Rules as set out by the Government of Pakistan.

SYLLABUS WEIGHTAGE
SERVICE & FINANCIAL RULES(WITH BOOKS)
SECTION-A
1. Terms and Conditions of Civil Servants
2 Structure of Pay and Allowance and other benefits
3 Leave 30%
4 Pension
5 General Provident Fund
SECTION-B
6 Financial Control and Budgeting
7 Loans and Advances
8 Public Procurement Rules 30%
SECTION-C
9 Government Servants Conduct Rules1964
10 Government Servants Efficiency & Discipline Rules, 1973
Procedure of Departmental proceedings against Government 20%
11 Servants, Suspension, Reinstatement, Punishments etc.
SECTION-D
12 Secretariat Instructions 1973
13 Human Resource Development 20%
14 Rules of Business 1973.
Total 100%
 The weightages given above are for the paper setter.
 The examination paper will consist of 10 questions divided into four sections A, B, C &D.
Section A and Section B will have 3 questions each and Section C and D will consist of 2
questions.
 Probationary officers will attempt 6 questions in total which shall be attempted in the
following order:
I. Two questions out of three from Section A (carrying 25 marks each)
II. Two questions out of three from Section B (carrying 25 marks each)
III. One question out of two from Section C (carrying 25 Marks)
IV One question out of two from Section D (carrying 25 Marks)

Note: The paper should contain at least 40% numerical based questions.

SUGGESTED READING LIST

1. General Financial Rules
2. Fundamental Rules and Supplementary Rules;
3. Civil Servants Act, 1973;
4. Appointment, promotion, Seniority and transfer rules;
5. Leave Rules -1980;
6. Compilation of Pension Rules and Orders;
7. Federal Treasury Rules
8. Government Servants(Efficiency and Discipline) Rules, 1973;
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9. Compilation of Service & Financial Rules –up to date amendments;
10. DDO Hand Book;
11. System of Financial Control and Budgeting
12. Public Procurement Rules.
13. Government Servant Conduct (E&D) Rules-1964
14. Rules of Business 1973 & Secretariat Instructions
15. Manual of Secretariat Instructions
16. Hand Outs on Human Resource Development

Page 21 of 37
Sr.# SECTION–A
DETAILED CONTENTS
1 Terms and Conditions of Civil Servants
 Statutory provisions regarding terms and conditions of service of Civil Servants
 Terms and conditions of Appointment of Public Servants and Probationers
 Definitions Under FR-9
2 Structure of Pay and Allowance and other benefits
 Statutory Provisions regarding pay.
 Fixation of pay under FRS and Basic Pay Scales
 Grant of annual increments.
 Schemes of Basic scales of pay, Revised and Basic scales of pay
 Fixation of pay on initial appointments, promotions, adhoc appointments, current
charge, additional charge and officiating appointments
 Fringe benefits: House Rent, Conveyance, Dearness and other Allowances.
 TA Rules: TA on Tour and TA on Transfer
 Preparation of Pay and TA Bills
3 Leave
 Statutory Provisions regarding leave
 Leave Account under Revised Leave Rules, 1980.Calculation of leave, Preparation of
Leave Accounts. Grant of leave with or without MC Leave not due, Encashment of
LPR, EOL, Other kinds of leave
4 Pension
 Classification and categorization of pensions
5 General Provident Fund:
 Statutory Provisions
 GP Fund Rules; Salient Features
 Constitution of the Fund-Conditions, Nomination, Rates of Subscription. Protection of
accumulations.
 Allotment of number and maintenance of GPF Account. Cal. of profit on GPF Accounts.
 Advance from GPF, Final withdrawals
SECTION-B
6 Financial Control and Budgeting
 Responsibilities of principal accounting officers.
 Financial Advisory and Finance and Accounts Officers.
 Budget Preparation and Implementation.
 Development schemes and Development Plans.
 Development and Non Development Expenditure.
 Delegation of Financial Powers
7 Loans and Advances
General conditions governing loans and Advances
House Building and House Purchase Advances. Conditions; Mode of payment. Mode of
recovery. Calculation of interest
Advances for the purchase of Motor Car/Motor Cycle/Cycle; Mode of payment
Advances on Transfer/Tour; Mode of payment, Mode of recovery.
8 Public Procurement Rules
 General Provisions
 Scope and applicability
 Principles of procurements
 Limitation on splitting or regrouping of proposed procurement
 Response time

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  Disqualification of suppliers and contractors
 Blacklisting of suppliers and contractors
 Principal method of procurement
 Submission of bids
 Bidding documents
 Bid security
 Extension of time for submission of bids
 Opening of Bids
 Discriminatory and difficult conditions
 Rejection of bids
 Re-bidding
 Announcement of evaluation reports
 Procedures of open competitive bidding (For large and complex contracts)
 Acceptance of bids
 Performance guarantee
 Limitation on negotiations
 Confidentiality
 Direct contracting
 Negotiated tendering
 On Account Payment
 Record of procurement proceedings
 Redressal of grievances by the procuring agency
 Misc. procurement
SECTION -C
9 Government Servants Efficiency & Discipline Rules 1973
 Government Servants Conduct Rules1964.
 Government Servants Efficiency & Discipline Rules, 1973.
 Procedure of Departmental proceedings against Government Servants, Suspension,
Reinstatement, Punishments etc.
SECTION-D
10 Secretariat Instructions 1973
11 Human Resource Development
12 Rules of Business 1973.
a) Consultation among divisions
 Inter-division procedure
 Secretaries Committee
 Consultation with Cabinet Division
 Consultation with Establishment Division
 Consultation with Finance Division
 Consultation with Foreign Affairs Division
 Consultation with Law Division
b) References to the Prime Minister
c) Cabinet Procedure
 Cases to be brought before Cabinet
 Method of disposal by Cabinet

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  Manner of submission of Cabinet Cases
 Procedure regarding circulation of Cabinet cases
 Procedure regarding Inter Provincial conference
 Procedure regarding National Economic Council
d) Legislation
 Official bills
 Non official bills
 Official and non official amendment to bills
 Ordinances
e) Relations with Parliament

 Compliance with rules of parliament
 Summoning of parliament, a house or joint sitting by President
 Prorogation of Parliament, house or joint sitting by parliament
 Order of the day
 Introduction of bills
 Assent to bills
 Resolutions
 Motions
 Budget
 Relations with Provinces
 Directions to the Governor
 Obligations of Provinces and Federation Conferment of power and imposition of duties
upon a province
f) Emergency Provisions
 Proclamation of emergency on account of war, internal disturbance
 Failure of constitutional machinery in a province
 Proclamation in case of financial stringency
 Revocation of proclamation
g) Miscellaneous Provisions
 Protection and communication of official information
 Channels of communication
 Relaxation
 Repeal

Page 24 of 37
PAPER 6: (100 MARKS)
BUSINESS LAWS AND TAXATION
Total Credit Hours: 80

INTRODUCTION
Mercantile Law

The aim of this paper is to test the understanding of significant Mercantile, Company and
Income Tax laws in Pakistan. This should enable the candidates to prepare themselves for a
professional approach to problems connected with mercantile laws encountered in the
performance of their duties as accountants in practical life.
Company Law

This course is to provide candidates with knowledge of the Companies Ordinance, 1984 and
to develop amongst them an understanding of incorporation of companies, shares and
management and administration.
Income Tax Law & Sales Tax Act (With Books)

The aim of this part of the syllabus is to develop knowledge of the candidates to core areas of
Income Tax and its chargeability as envisaged in the Income Tax Ordinance, 2001 (along
with the Sales Tax Rules, 2002 relevant to coverage of the syllabus), Sales Tax Act 1990 and
its rules (relevant to coverage of syllabus).
As a result, candidates will be able to:
 Explain the operation of Income Tax Law in Pakistan
 Prepare and Compute the amount of income derived under each head of income
 Prepare and compute the amount of income tax liability in respect of individuals only

Notifications and circulars in respect of Finance Act/ Ordinance, issued within a period of
less than six months from the examination date will not be tested. The Examiner will expect
that the candidates should display an accurate working knowledge of the subject
matter/relevant laws. They will not be expected to quote relevant sections of the Laws or
decided cases in support of their answers. However, illustrations in support of their answer
will gain marks

Page 25 of 37
 SYLLABUS WEIGHTAGE
BUSINESS LAWS & TAXATION
Business Laws
SECTION-A
1. Contract Laws
2. Indemnity
30%
3. Agency
4. Negotiable Instruments
5. Sale of Goods
6. Partnership.
SECTION-B
7. Preliminaries of Company Law
Role of SECP as an industry regulator and Incorporation of
8. companies and matters incident thereto
9. Commencement of business by Public Company 30%
10. Meeting and Proceedings
Directors, Company Secretary, CFO, Chief Executive and
11. Managing Agents
12 Role of company Auditors
SECTION-C
13 Taxation
Income Tax Ordinance, 2001
Heads of Income, Computation of Income, Determination of Tax
Liability and Payment of Taxes
Types of Person and Their Taxation 40%
Procedures and Administration
Sales Tax Act 1990 (Basic concepts)
14 Provincial sales Tax (Services), Act
Total 100%

 The weights assigned against each section are meant for the paper setter.
 The examination paper will consist of ten questions divided into three sections A, B & C.
Section A and section B will have 3 questions each and section C will consist of 4 questions.
 Probationary officers will attempt five questions in total which shall be attempted in the
following order.

I. At least one question out of three from Section A

II. At least one question out of three from Section B
III. Two questions out of four from Section C

SUGGESTED READING LIST:

1. Practical Approach to Company Ordinance 1984 by Nazir Ahmed Shaheen
2. Company Law (LuqmanBaig)
3. Contract Law (Khalid Mehmood Cheema)
4. Business Law by Khalid Mehmood Cheema
5. Federal Direct Taxes of Pakistan
6. Federal Indirect Taxes & Other Statutes
7. Sales Tax Hand Book (Latest Edition)

Page 26 of 37
Sr.# SECTION-A
DETAILED CONTENTS
BUSINESS LAW
Introduction to Legal System
 Sources of law; process of legislation and the legal system in Pakistan
1 Contract Laws
 Agreement, Contract, Nature and kinds of Contracts:
Essentials of Contract; Offer or Proposal; Acceptance; Consideration; Flaws in
Contracts; Flaw in Capacity; Flaw in Consent; Unlawful agreements; Void
agreements; Voidable agreements, Novation, Restitution; Quasi-contracts; Various
Discharges of contract; Doctrine of Frustration; Remedies for breach of contract.
2 Indemnity
 Contract of Indemnity; Contract of Guarantee; Rights of Surety; Discharge of Surety.
3 Agency
Definition and general rules; Creation of agency; Classes of Agents; Delegations of
Authority; Duties and rights of agents; Scope and Extent of Agent’s authority;
Responsibilities of Principal to third parties; personal liability of agent to third party;
termination of agency
4 Negotiable Instruments
 Promissory notes & Bills of exchange; Bank Drafts, Cheques; Distinction between
cheques and Bills; Inland and Foreign Instruments; Negotiation; Acceptance;
Presentment; Dishonor Discharge; Compensation
5 Sale of Goods
 Contract of sale; Sale and Agreement to sell; Sale and transactions distinguished;
Formation of a contract of sale; Subject matter of contract of sale;The Price
6 Partnership.
 Law of Partnership. Registration of Firms
 Relations of Partners. Rights and Duties of Partners Dissolution of Firm

SECTION-B
7 Preliminaries of Company Law
 Definitions
 Subsidiary and associated companies
 Application of Companies Ordinance to non-trading companies and its non-
applicability to certain corporations etc.
 Ordinance to override memorandum and articles etc.
 Application of the Companies Ordinance, 1984 To companies governed by special
enactment(section 503)
 Section 12, Sub-section (1) & (2) and Section 13
8 Role of SECP as an industry regulator and Incorporation of companies and matters
incident thereto
 Obligation to register certain associations, partnerships etc. as companies
 Form of Memorandum of Association (MoA) and Articles of Association (AoA)
 General provisions with respect to registration of memorandum and articles
 Provisions with respect to names of companies
 Associations not for profit
 Companies limited by guarantee
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  Conversion of private limited company to a public limited company and vice versa and
other matters
 Single Member Company (SMC); Conversion of(SMC) into private limited company
or into a public limited company and vice versa and other matters
 Consequences of carrying on business with less than the legal minimum number of
members
 Effect of incorporation and concept of separate legal entity, meaning of promoters
9 Commencement of business by Public Company
10 Meeting and Proceedings
11 Directors, Company Secretary, CFO, Chief Executive and Managing Agents
12 Role of company Auditors
SECTION-C
TAXATION
13 Income Tax Ordinance, 2001
 Basic Concepts of Taxation
- Preliminary
- Charge of Tax
- (I-III) Common Rules
- Administration
- General
 Heads of Income, Computation of Income, Determination of Tax Liability and
Payment of Taxes
- (I-X) Tax on Taxable Income
- Minimum Tax
- (V) (I_IV) Advance tax and Deduction of Tax at Source
 Types of Person and Their Taxation
- (II)(I –III) Individuals
 Procedures and Administration
- Returns
- Assessments
- Appeals
- Collection and Recovery of Tax
- Records, Information Collection and Audit
- Returns
 Sales Tax Act 1990 (Basic concepts)
- Definitions
- Scope and Payment of Tax
- Registration
- Book keeping and Invoicing
14 Provincial sales Tax (Services), Act
- Definition, Scope and payment of tax, Registration, Book keeping and invoicing,
Returns

Page 28 of 37
PAPER 7: (100 MARKS)
Communication Skills 0 MARKS)
Total Credit Hours: 62

INTRODUCTION

This syllabus aims to test the student’s ability towards communication. This syllabus will guide
students about basic concepts of communication, Advantages and barriers of effective
communication, Uses of technology in communication, Professional writing and academic
writing for research purpose.

SYLLABUS WEIGHTAGE
COMMUNICATION SKILLS
SECTION-A
1 Background of Communication 5%

2 Process of Communication 10%

3 Preparing Effective communication 10%
4 Use of technology in communication 10%
SECTION-B
5 Professional writing 35%

6 Academic Writing- Writing for research purposes 20%

7 Verbal Communication 10%
Total 100%

 The weights assigned against each section are meant for the paper setter.
 The examination paper will consist of eight questions divided into two sections A and B. Section
A will consist of 4 questions and section B will have 4 questions.
 Probationary officers will attempt five questions in total which shall be attempted in the
following order:

I. At least two questions out of four from Section A

II. At least two question out of four from Section B

SUGGESTED READING LIST:

 Effective Business Communication by Herta & Murphy
 Business Communication by Shakeel Amjad
 Business Communication today by Courtland l. Bovee

Page 29 of 37
Sr. No. DETAILED CONTENTS
SECTION-A
1 Background of Communication
 Concept of Communication
 Importance of Communication
 Communication Flow
 Advantages of Communication in professional career
 Written vs. Oral Communication
2 Process of Communication
 Principles of Communication
 Components of Communication
 Barriers in effective Communication
 Verbal vs. Nonverbal Communication
3 Preparing Effective communication
 Planning steps
 Beginnings and Endings
 Closing Paragraphs
 Revising your message
 Editing and proof reading
4 Use of technology in communication
 Video conference
 Video chat rooms
 Email
 Skype
 Tango-Imo
 Facebook
 Twitter
 Mobile & Texting services
 Whatsapp
SECTION-B
5 Professional writing
 OM and corrigendum
 UO/DO
 Summaries
 Notifications
 Noting/Drafting, ETC
 Communiqué
 Press Note
 Drafting of formal Minutes of the meeting
 Writing of Enquiry report
6 Academic Writing- Writing for research purposes
 English comprehension & Précis Writing
 Analytical Writing
 Discovering, Narrowing and focusing a Researchable topic
 Writing a problem Statement
 Finding, selecting and Reading sources
 Grouping, sequencing and documenting information
 Writing the outline
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  Writing the introduction, body and conclusion
 Revising the final Draft
 Referencing the paper
7 Verbal Communication
 Presentation skills
 Components of presentation skills
o Speaker
o Message
o Audience
o Channel
o Feedback
o Noise
o Setting
 Successful presentation
o Stages
o Organization
o Types
o Delivering the speech
o Do’s and Don’ts
 Negotiation skills

Page 31 of 37
PAPER –8 (150 MARKS)
Information Systems Audit
Total Credit Hours: 80

INTRODUCTION
The course is designed to provide students with a basic understanding of Information Systems
and process of auditing information systems.

SYLLABUS WEIGHTAGE
INFORMATION SYSTEMS AUDIT
1 Introduction to information systems 10%
2 The process of Auditing information systems 15%
3 Corporate Governance 10%
4 Information system acquisition, Development and 15%
Implementation
5 Information System Operation Maintenance and Service 15%
Management
6 Protection of Information Assets 35%
TOTAL 100%

 The weights assigned against each section are meant for the paper setter.
 The examination paper will consist of one hundred (100) Multiple Choice
Questions (MCQs)
 Probationary Officer will be given four options out which one will be correct.
 Each question will carry 1.5 marks.

Suggested Readings
CISA Review Manual, latest Edition perusal

CISA Question Bank, Latest Edition

CISA,All in One Guide by Peter H. Gregory

Page 32 of 37
Sr. No. DETAILED CONTENTS
1 Introduction to Information Systems
 Components of Information systems
 Hardware Types
 Software Types
 Importance of information systems
2 The process of Auditing information systems
Management of the IS Audit Function
 Organization of the IS Audit Function
 IS Audit Resource Management
 Audit Planning
 Risk Analysis
 Internal Controls
Performing An IS Audit
 Audit Objectives
 Types of Audits
 Audit Methodology
 Risk-based Auditing
 Audit Risk and Materiality
 IS Audit risk assessment techniques
 Audit Programs
 Compliance versus substantive testing
 Evidence
 Interviewing and observing personnel in performance of their duties
 Sampling
 Using the services of other auditors and experts
 Computer Assisted Audit Techniques
 Communicating audit results
 Audit Report structure and contents
 Audit documentation
 Closing findings
 Case studies
 Answers to the case studies
3 Corporate Governance
Governance of Enterprise IT
 IT governing committees
 Infromation security governance
Information system strategy
 Strategic planning
 IT steering committee
Policy and procedures
 Policies
 Procedures
Risk management
 Developing a risk management programme
 Risk management process

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 Information technology management practices
 Human resource management
Sourcing practices
 change management
IT organizational structure and responsibilities
 IT role and responsiblities
 Segregation of duties with in IT
 Segregation of duties control
Auditing IT Governance Structure and Implementation
 Reviewing documentation
 Reviewing contractual commitments
Business continuity planning
 IT business continuity planning
 disaster and other disruptive events
 Business continuity planning process
 Business continuity policy
 Planning incident management
 Business impact analysis
 Development of plans
 Other issues in plan development
 component of a plan
 Plan testing
Auditing business continuity
 Review
 Evaluation of test result
 Evaluation off site storage
 Interviewing
 Security at off site facility
 Reviewing processing contract
 Reviewing insurance coverage
 Case Studies
4 Information Systems Acquisition, Development and Implementation
 General aspect
 Context environment
 organizational forms
 Culture
 Objectives
 Roles and responsibilities
Project management practices
 Initiation
 Project planning
 Execution
 Controlling
 Closing
Business application development
 SDLC approach
 Description of SDLC
Business application systems
 E-commerce
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  Electronic data interchange
 Email
 point of sale system
 E-banking
 E-Finance
 Payment systems
 E-Fund transfer
 ATM
 voice response
 Accounting system
 Image processing
 Controll systems
 Artificial Intelligence
 Business intelligence
Infrastructure development
 Critical success factor
 Hardware acquisition
 Software acquisition
 Software implementation
Information system maintenance
 Change Management
 Configuration
Application controls
 Input controls
 Processing procedures
 output control

Auditing Application Controls

 Flow of transactions
 Risk assessments
 Observing
 Data integrity
 Online data integrity
 Test applications
 Online auditiing
 Auditing techniques
Auditing System Development
 Project management
 Feasisiblity study
 Requirement Definition
 Software acquisition
 Detail design
 Testing
 Implementation
 Post implementation
 Change procedure
Case studies and answers

Page 35 of 37
5 Informatino System Operation Maintenance and Service Management
 IT service management
 Incident and problem mangement
 Support
 Change management
 Releasse Management
 Qualilty Assurance
 IT Asset management
Information System Hardware
 Hardware component
 Maintenance
 Monitering
 Capacity Mangement
IS Architecture and Software
 Operating systems
 Access control software
 Communication software
 Data mangement
 Data base management
IS network infrastructure
 Enterprise network
 Types
 Services
Auditing Infrastucture and operations
Disaster Recovery
 Recovery Point objective /Time objecive
 Recovery strategies
 Recovery alternatives
 Development of disaster Recovery
 Organization and Assignment
 Backup and restoration
 Disaster recovery testing methods
 Invoking disaster recovery plans
 Case studies and answers
6 Protection of Information Assets
Information security management
 Classification of information assets
 Mandatory and discretionary access controls
 Computer crime
 Security incident handling and response
Logical Access
 Exposure
 Familirazation with enterprize
 Paths of logical access
 Logicall access control software
 Identification and authentication
 Authorization issues
 Storing Retrieving Transporting and Disposing of confidential information
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Network Infrastructure security
 LAN security
 Client server security
 Wireless security threats
 Inernet threats and security
 Encryption
IPS and IDS and Firewalls
Auditing information security management framework
 Auditing Logical Access
 Techniques for testing security
 Investigation techniques
Auditing network infrastucture security
 Auditing remote access
Environmental exposeures and control
 Exposures and Issues
 Controls
 Auditing environment controls
Physical access exposures and controls
 Physical access issues exposure
 Physical access control
 Auditing physical access
Social Media
Cloud computing
Case studies and answers

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