Solved Questions

Investing in a company requires a thorough analysis of the investment opportunity before committing funds. This analysis involves verifying the accuracy of the information provided by the company and assessing the value of the investment. To verify the accuracy of the information provided by the company, due diligence is conducted. Due diligence is a comprehensive …

Discuss the process of verification and valuation of investments in a company. Read More »

Internal control, internal check, and internal audit are all critical components of a comprehensive governance framework. These three functions serve different but interrelated purposes in ensuring that an organization operates effectively, efficiently, and in compliance with applicable laws and regulations. Internal control is a systematic process that an organization uses to provide reasonable assurance that …

Explain the terms “Internal Control”, “Internal Check” and “Internal Audit”. What are the requisites of a good internal control system? Read More »

(a) Changing Value System: A value system is a collection of beliefs and principles that provide guidance for an individual’s decision-making and behavior. When a society or an individual undergoes a transformation in their core beliefs and principles, it is referred to as a changing value system. The factors that contribute to a shifting value …

Write short notes on the following: (a) Changing Value System (b) Economic development (c) Indication of Sickness (d) Joint Ventures Read More »

(a) Foreign Direct Investment and Portfolio Investment: Foreign Direct Investment (FDI) and Portfolio Investment are two different methods of investing in a foreign country. FDI involves a foreign corporation or individual investing in a company located in another country. The foreign investor typically acquires a controlling stake in the company, usually 51% or more, and …

Distinguish between the following: (a) Foreign Direct Investment and Portfolio Investment. (b) Direction of Exports and Direction of Imports. Read More »

The government policy towards small scale industries has been instrumental in promoting their growth and development. Small businesses contribute significantly to the economy by providing employment opportunities, enhancing entrepreneurship, and contributing to GDP growth. The government has adopted several policies to support small businesses, including financial assistance, infrastructure facilities, training and technical assistance, reduction of …

Critically evaluate the government policy towards small scale industries. Read More »

The regulatory role of the government refers to the responsibility of the government to establish rules and regulations to ensure that businesses, organizations, and individuals operate in a manner that is safe, fair, and in accordance with the law. This role is shaped by various factors such as political, economic, and social contexts, and the …

Explain the nature and implications of regulatory role of the government. Read More »

The business environment is the sum total of all external and internal factors that influence an organization’s operations and its decision-making. Understanding the different components of the business environment is essential for organizations to develop strategies that will help them adapt to changes in the market, leverage opportunities, and mitigate risks. The three components of …

What are the three components of business environment? Discuss. Read More »

Working capital is the amount of money that a business needs to fund its day-to-day operations. It is calculated by subtracting current liabilities from current assets. Current assets are those that can be converted into cash within a year, such as inventory, accounts receivable, and cash. Current liabilities are those that are due within a …

What is working capital? What do you understand by gross working capital and net working capital? Read More »

Departmental accounts refer to a system of accounting where a company’s financial transactions are recorded and tracked separately for each department or division. This method is particularly useful for large organizations with multiple departments, as it allows for a more detailed analysis of each department’s financial performance. One advantage of departmental accounts is that they …

What do you mean by Departmental Accounts? What are the advantages of Departmental Accounts? Read More »

The Companies Act, 2013 provides various provisions for companies issuing debentures to raise funds for their business activities. A debenture is a type of loan instrument, and the Act provides for their issuance at par, premium, and discount. However, this answer will focus on the provisions for debentures issued at a discount. Section 71 of …

Describe various provisions of Companies Act that deal with the issue of debentures at a discount. Give accounting treatment of debentures issued as a collateral security by the company. Read More »