Frequently Asked Questions (FAQs) regarding requirements to prepare Consolidated Financial Statements

icai blog

The purpose of these FAQs is to illustrate and to assist in clarifying the requirements regarding preparation of Consolidated Financial Statements


  1. Whether a company H ltd is required to consolidate its subsidiary which is a Limited Liability Partnership (LLP) or a partnership firm?
  2. Would the answer be different if LLP is an associate or joint venture of H Ltd?


  1. As per rule 6 of Companies (Accounts) Rules, 2014, under the heading ‘Manner of consolidation of accounts’ it is provided that consolidation of financial statements of a company shall be done in accordance with the provisions of Schedule III to the Companies Act, 2013 and the applicable Accounting Standards.
    It is noted that relevant Indian Accounting Standard i.e., Ind AS 110, Consolidated Financial Statements provides that where an entity has control on one or more other entities, the controlling entity is required to consolidate all the controlled entities. Since, the word ‘entity’ includes a company as well as any other form of entity, therefore, LLPs and partnership firms are required to be consolidated. Similarly, under Accounting Standard (AS) 21, as per the definition of subsidiary, an enterprise controlled by the parent is required to be consolidated. The term ‘enterprise’ includes a company and any enterprise other than a company. Therefore, under AS also, LLPs and partnership firms are required to be consolidated.
    Accordingly, in the given case, H ltd is required to consolidate its subsidiary which is an LLP or a partnership firm.
  2. If LLP or a partnership firm is an associate or joint venture of H ltd, even then the LLP and the partnership firm need to be consolidated in accordance with the requirements of applicable Accounting Standards.



A Company H ltd has no subsidiaries, but has investment in an associate and a joint venture. Whether H Ltd. is required to prepare consolidated financial statements for the year ending March 31, 2016, in the context of Companies (Accounting Standards) Rules, 2006.

Section 129 (3) of the Companies Act, 2013 provides that where a company has one or more subsidiaries, it shall prepare a consolidated financial statement of the company and of all the subsidiaries. Further, an Explanation to this sub section provides that the word “subsidiary” shall include associate company and joint venture.

In view of the above, in the given case, though H ltd does not have any subsidiary, it is required to prepare consolidated financial statements for its associate and joint venture in accordance with the applicable Accounting Standards, viz, AS 23, Accounting for Investments in Associates in Consolidated Financial Statements and AS 27, Financial Reporting of Interests in Joint Ventures, respectively.


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Website : CA Learning

Comparision b/w MBA and CA

mba vs ca

A Chartered Accountant can add on his qualification. He/She may decide to do an MBA with a specialisation in finance. CA’s choose to do a MBA is because it allows them to attain the designation of a CEO and also empowers the individual to take a decision based on faith even when the numbers are against the decision.

The major reasons for pursuing MBA over CA are as follows:

  • Attain a high well paying post in multi nationals.
  • It gives the individual the zeal to take decisions even when numbers are not in favour of the decision.
  • MBA allows the individual to be much more exposed to various aspects of the business world whereas CA doesn’t.
  • It is difficult for a CA to shift into general management because of the narrow curriculum whereas a MBA course has a wider curriculum.
  • MBA instils better soft skills in the person rather than a CA degree.
  • Case based study make the learning more stimulating with a great experience.
  • There are more profiles which are available to MBAs over CAs as given below:

The profiles available are listed below:

·        MIS ·        Consolidation
·        Budgeting forecasting ·        Internal audit
·        Business planning ·        International accounting (GAAP)
·        Equity research ·        Transaction Advisory
·        Investment banking
·        Mergers& acquisitions
·        Fund Management
·        Portfolio management
·        Treasury
·        Sector Analysis


Contributed by Jyotsna Singh Arora (Finance Intern at CA Learning)

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Changes / Amendments etc. for CA Final November, 2016

Amendments 1Applicable changes for CA Final Nov’16 Attempt:

CA Final Examination -Group 1

Paper 1 – Financial Reporting

Syllabus same as May’16 attempt :
✅ All old AS
❌ AS 30, 31 & 32
✅ All Ind AS carve outs or differences
❌ All IndAS in detail
✅ Ind AS 32, 107 & 109 in detail
✅ give a overview to summary of Ind AS only
❌ chapter 2 & 6 of Jan 15 study materials
✅ suppllemntry of revised chaptr 2 for may 16 attempt wch will contain all carve outs of Ind AS
Same is hosted on ICAI site here :
✅ Revised chapter 6 of study material which will cover accounting and reporting of financial instruments I.e. Ind AS 32, 107 & 109:

Note:- Amendments made by MCA on 30.3.2016 in the Companies (Accounting Standards) Rules, 2006 and
Companies (Indian Accounting Standards) Rules, 2015 have not been made applicable for November, 2016 examination.

There is no change for Nov, 16 as compared to may 16 for FR paper.

Paper 2 – SFM
a) No Change . Same as May 16 attempt

Paper 3 – Audit
a) CARO, 2016 applicable
b) Companies Act, 2013 : Amendments upto 30-4-2016 applicable
Paper 4 – Law
a) Companies Act, 2013 : Amendments upto 30-4-2016 applicable
1. Chapter 15 of the study material (January, 2016 edition) covering provisions relating to the National Company Law Tribunal and Appellate Tribunal
2. Chapter 9 of the study material (January 2016 edition) covering provisions relating to Revival and Rehabilitation of Sick-Industrial Companies.

CA Final Examination -Group 2

Paper 5 – AMA
No Change – Same as May 16 attempt

Paper 6 – ISCA
New edition Jan 16 is applicable, it holds many changes.

Paper 7 – DT : Finance Act 2015 + Notifications or circulars up to 30th April, 2016

Paper 8 – IDT : Finance Act 2015 + Notifications or circulars


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Becoming a Chartered Accountant in various countries in Europe (Part 2)


Each country in Europe has its own accounting body and accounting qualification.

  • Finland
    Title: KHT or HTM

KHT is regarded as the primary qualification and is authorised by the Central Chamber of Commerce in Finland. Students must fulfil certain educational requirements, hold relevant professional experience and pass an examination of professional competence. Students must have completed studies necessary for the duties of an auditor in subjects which are laid down in the regulation of the Ministry of Trade and Industry and obtained a minimum of three years practical experience under the supervision of a KHT.

  • France
    Title: Expert Comptable

Whilst there are a number of routes to qualification in France, the majority of candidates enter the process upon completion of a degree from a business school. Qualification typically takes four years and passes through the following intermediate diplomas:

  • DPECF (Diplôme Préparatoire aux Etudes Comptables et Financères) Written tests on employment law, economics and accounting…
  • DECF (Diplôme d’Etudes Comptables et Financères) Written tests on law, economics, management, accounting and controlling…
  • DESCF (Diplôme d’Etudes Supérieures Comptables et Financères) Written and oral tests.

Upon completion of these exams there follows a three-year traineeship with a practice firm followed by the presentation of a thesis on a subject related to the professional domain. The candidate must also pass a further two examinations: a written test on the statutory and contractual auditing of financial statements and an oral test relating to the traineeship and covering professional knowledge in general.

  • Germany
    Title: Wirtschaftspruefer

Whilst there are a number of routes to qualification, most students will first qualify as a ‘Steuerberater’ (A chartered German ‘Tax adviser’), which comprises three written examinations and one oral examination before deciding to move onto the Wirtschaftspruefer.

There are relatively few Witschaftpruefers in Germany. On a long term average only 50% of applicants are successful.

  • Hungary
    Title: HCA

Students need a relevant business degree, followed by three years professional experience, followed by a two year long education programme. Upon completion, the student becomes a qualified auditor. However, it is only after completing a further three year training programme that students become a full Chartered Accountant.

Contributed by Jyotsna Singh

For previous part

Website – CA Learning

Becoming a Chartered Accountant in various countries in Europe (Part 1).


Chartered Accountant in various countries in Europe :

Each country in Europe has its own accounting body and accounting qualification.

  • Belgium
    Title: Bedrijvsrevisor or Reviseur d’Entreprise

Students must hold a university degree or equivalent foreign diploma and pass an initial trainee exam programme. Completion of a three year traineeship within a recognised practice firm is followed by a competency exam, comprising a written and oral test. Finally, successful students declare an oath before the ‘Court of Commerce’.

  • Cyprus
    Title: ICPAC

The qualification in Cyprus is identical in every way to the ACA examinations in England and Wales. This extends to the fact that candidates are taught in accordance with UK standards, even though Cyprus tends to deal amore with IFRS. The amount of experience required post-qualification is also identical.

  • Luxembourg
    Title: Réviseur d’Entreprises

Students must hold a full four year university degree and obtain a minimum of three years relevant experience within a recognised audit firm. During this period, the student must obtain a ‘Certification de Formation Complémentaire’, which comprises nine examinations. The final exam, ‘Diplome d’aptitude professionelle’, comprises a written and oral examination and presentation of a training report.

  • Russia
    Title: CIPA (Certified International Professional Accountant)

Students must hold a university degree and have completed three years work experience in an economics or finance area before taking the professional examination. Students must also complete a six-month training period.

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Contributed by Jyotsna Singh


Job prospects and objectives for a Chartered Accountant


The growing importance of trade and industry along with the rapid growth of capital and money markets in an economically developing nation like ours  has increased the importance of Chartered Accountants enormously. Moreover all the companies registered under the Companies Act, are required to get their accounts audited only by practising Chartered Accountants. A qualified Chartered Accountant has the option of joining the Government Service, Public Sector undertakings or taking up a lucrative assignment in the private sector. The duty of Chartered accountant is to ensure that the financial transactions of an organisation are maintained according to the law, they also keep track of cost of management of the company and manage tax matters.

Chartered accountants work as Finance Managers, Financial Controllers, Financial Advisors or Directors (Finance) and watch over the finances in the day to day management of companies. Their main areas of work include Accountancy, Auditing, Cost accountancy, Taxation, Investigation and Consultancy.

Some of the opportunities available for Chartered Accountants are in capital markets, business houses and industry. They can also have their own consultancy or private practice which could be more lucrative and satisfying. With the country liberalizing its policies and approach, opportunities are expected to grow further.

Other career option: After passing the CA examination one could go for management Accountancy course; courses like Diploma in Insurance and Diploma in Information System Auditing.

Prospects Abroad : Institute of CA of India is well recognized by Institute of England, Wales and Australia. The members of ICAI can do practice or they can go for employment in these countries. ICAI is not approved by several countries like United Nations of America. Since ICAI is a member of the international Federation of Accountants committee and also international federation of Accounting Standard board, one can do their services in these countries. But for practising they should undergo a particular examination conducting by the respective countries. The examination conducted by UNA is called CPA, Certified Public Accountant Examination.


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Contributed by Jyotsna singh

How to become a Chartered Accountant in Canada?

chartered accountant in canadaSteps to Becoming a Chartered Accountant in Canada:

The process by which one becomes a chartered accountant in Canada consists of four major components:

  • Prerequisite undergraduate education consists of earning a bachelor’s degree through an approved program that provides specific courses at specified levels as determined by each educational region.
  • Competency based practical experience consisting of three years (30 months) of active full time employment, during which time competencies are mastered through supervised work experience. Candidates will dedicate much of their time to developing the specific competencies they choose to focus their careers on.

Candidates choose two competency areas, which become the focus for their careers, from these six areas: performance measurement and reporting, assurance, taxation, risk management, management decision-making and finance.

Experience is gained through approved CA training offices, referred to as CATOs. CATOs are fully operational accounting and professional services firms that have agreed to provide the paid supervised experience aspiring CAs need to achieve the designation.

  • Educational modules are participated in during the three-year work experience component of the CA program. There are a total of four educational modules that combine in-person and online classes, workshops and seminars to augment and enhance the work experience.

The education is integrated into the experience component in such a way that candidates can apply new information to their practical experience. These modules generally conclude with a finalist preparation program (FPP) designed specifically to help students prepare for the Uniform Evaluation.

  • The Uniform Evaluation (UFEis the final step to becoming a chartered accountant in Canada. It is a three-day long exam where candidates demonstrate their knowledge of accountancy and mastery of competencies developed during their work experience.

Contributed by

Jyotsna Singh Arora

Finance Intern in CA Learning

Requisites for CA in the M&A industry


It is impossible for a fresh Chartered Accountant to get a job in the mergers and acquisitions industry but here are the following requisites that the companies in this industry require by the CA:

1- Financial modelling. 

CAs have zilch knowledge about building models. To add to the misery, 90% CAs struggle with Excel. When I was doing my Advanced ITT, more than 60% of the class had never used a Vlookup in their life/article ship! It felt horrible to witness such a scene. And then the CA fraternity whines about good companies not picking them up. No shit, duh.

2- Valuation techniques.

Again, apologies to burst your bubble but whatever valuation we learn in our CA books is of little or NO use against what you do practically.

3- Deep industry knowledge.

Barely industry knowledge exists amongst fresh CAs. Those who’ve done audit will have good knowledge about the company they’re working on.

If you feel otherwise, pick up your favourite industry and ask yourself these questions – What’s the average PE of the industry? What’s the average EV /EBIDTA? What’s the average and median EV/sales? Which company is an outlier from a valuation perspective and hence should be ignored?

If you can’t answer the above mentioned questions, I’m sorry to say you won’t be able to make it into a M&A firm as a fresher CA unless you have a pull, or course.


Contributed by

Jyotsna Singh

Marketing intern in CA Learning


How to become a Chartered Accountant in Australia?

CA in australia

Become a Chartered Accountant in Australia

The Chartered Accountants designation is the hallmark of a highly qualified, ethical accounting professional.Highly regarded by business, regulators, and members of the public, Chartered Accountants can look forward to a rewarding career at the peak of their profession.

International recognition and career opportunities: By achieving the prestigious Chartered Accountants designation you'll gain access to a wide choice of job roles across hundreds of industries in countries around the world.

You will also join the Global Accounting Alliance – a collective of over 800,000 of the most highly qualified accounting professionals in the world. Through the GAA (as a Chartered Accountant) you will enjoy reciprocal recognition in any of the GAA counties.

Lifelong benefits and support

Throughout your career, membership of the Institute will continue to support you to be, and be seen to be the very best in your field throughout your career.

  1. The Institute acts to uphold the profession and monitor professional standards and ethics as well as advocating to regulators or key issues affecting the profession

  2. Ongoing knowledge support in specialist accounting areas, information on changes affecting the profession and all aspects of starting and managing an accounting practice, and tailored support for members working in commerce

  3. Opportunities to network and connect with other Chartered Accountants

  4. Access to Institute community and special interest groups

  5. An ongoing free subscription to the Institute's magazine, Acuity, which features independent and informed news and analysis from commentators, leaders in business and Chartered Accountants on significant accounting issues

  6. Access to the Institute's Online Knowledge Centre catalogue of over 13,000 books and over 80 journals, supported by professional research staff

  7. Member Offers – special offers on quality products and services from premium suppliers.


Written by Jyotsna Singh

Finance Intern at CA Learning


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