CWA ICWA Exam Papers Inter Group I Commercial and Industrial Laws and Auditing December 2009

CWA ICWA Exam Papers Inter Group I

Commercial and Industrial Laws and Auditing December 2009

 

This Paper has 61 answerable questions with 0 answered.
I–P6(CIA)
Syllabus 2008
Time Allowed : 3 Hours Full Marks : 100
The figures in the margin on the right side indicate full marks.
Answer Question No. 1 & Question No. 5 which are compulsory and attempt any two
from the rest in Section I and any two from rest in Section II
SECTION I (Marks 50)
(Commercial and Industrial Laws)
Marks
1. Comment on the following statements based on legal provisions: 2×7
(a) Wages of all the workers shall be paid before 5th of following month. (0)
(b) A complaint can be filed under Consumer Protection Act within 30 days from the date on which the cause of action arose. (0)
(c) A factory owner can close a place of employment of his own. (0)
(d) Mr. Sham joining on 1.11.09 as an accountant wanted to become member of PF from 1.11.09 but Personnel Manager disagreed. (0)
(e) Mr. Sham, who retired on 30.11.09 did not vacate office quarter which was provided by his employer. Employer withheld the Gratuity to force him to vacate the quarter. (0)
(f) Mr. Sham agrees to sale Mr. Ram 10 bags of wheat out of 100 bags lying in his godown for Rs. 10,000. Wheat is completely destroyed by fire. Mr. Ram cannot compel Mr. Sham to supply wheat as per contract. (0)
(g) Creches are compulsory in a factory where women employees are employed. (0)
2. (a) Mr. E draws a cheque in favour of Mr. F (a minor). Mr. F endorses it in favour of Mr. G. who in turn indorses in favour of Mr. H. The cheque is dishonoured by the Bank. Discuss the rights of Mr. G and Mr. H and state against whom their rights can be exercised. 2 (0)
(b) Mr. Sham orders on Mr. Ram to deliver certain goods at Mumbai. While the goods are lying at Mumbai Rly. Station, Station Master informs Mr. Sham that the goods are held at station at Mr. Sham’s risk, but Mr. Sham became insolvent. Has Mr. Ram has any right as an unpaid seller? 2 (0)
(c) ‘Predatory price means the sale of goods or provision of services at price which is above cost with a view to reduce competition or, eliminate competition. Is it correct? 2 (0)
(d) ‘B’ offered to sell his car to ‘A’ for Rs.75,000. ‘A’accept to purchase at Rs.74,950. ‘B’ refuses. Subsequently ‘A’agrees to purchase at Rs.75,000 but ‘B’ refused. ‘A’ sued ‘B’ for specific performance of the contract. State legal position. 2 (0)
(e) A cheque for Rs.10,000 was dishonoured. Drawer of the cheque submitted valid reasons and justification.
Due to relevant reasons for dishonour, the drawer is not responsible. Answer with legal provisions. 2 (0)
(f) Objectives of Competition Act is to avoid competition. — Comment with legal provisions. 2 (0)
(g) Mr. A a workman while working was attacked by another workman at the instance of an outsider and consequently Mr. A was injured. Whether employer was responsible? 2 (0)
(h) Mr. A approached Union Bank for loan of Rs.1,00,000 which was not available from others due to tight money market. Bank agreed but at a high rate of interest. Mr. A accepted. Can he repudiate on the ground of undue influence? 2 (0)
(i) The Charitable Institutions are not industry (Industrial Disputes Act, 1947). Do you agree? 2 (0)
3. (a) Write short notes on any four: 4×4
(i) Termination of lien; (0)
(ii) Bid Rigging (Competition Act, 2002); (0)
(iii) Award – Ind. Disputes Act; (0)
(iv) Notional extension; (0)
(v) Agency of necessity. (0)
(b) Mr. Sham was terminated from employment by the employer on 25.11.09. PersonnelManager directed him to collect his wages earned on 1.12.09. Mr. Sham objected to the date. State legal provision as to the date of payment. 2 (0)
4. (a) Whether Mr. Sham who joined the company on 1.7.05 and died on 30.11.09 is entitled to Gratuity. Answer citing Rules. 2 (0)
(b) Manager of ABC Ltd. told that total amount of deduction which may be made from the wages of any workman during a month shall not exceed 90% of such wages. – State legal provisions. 2 (0)
(c) On 30.11.09 Mr. Sham agrees to sell a painting to Mr. Ram for Rs.5,000/- but Mr. Sham died on 8.12.09.
Mr. Sham’s son claimed Rs.10,000/-. Can Mr. Ram obtain the painting at Rs.5,000/- which was agreed to by Mr. Sham? 2 (0)
(d) Mr. Sham informs Mr. Ram that Mr. Sham’s estate is free from encumbrances. Mr. Ram buys the property fully relying on Mr. Sham. Subsequently it revealed that the estate was mortgaged. What will be the position of Mr. Ram? 2 (0)
(e) Mr. Ram gives some diamond to Mr. Sham on “sale or return” basis. on the same day, Mr. Sham gives those diamonds to Mr. Jadu on “sale or return” basis. Those diamonds were lost from Mr. Jadu on the same day, who will bear the loss? 2 (0)
(f) In a contract with employer an employee agrees not to institute any legal proceeding against his employer.
Can the agreement be enforced by the employer? 2 (0)
(g) Right of information does not include the right of obtaining information in the form of disketts, floppy, tapes and video cassetts or in any other electronic mode. State correctposition. 2 (0)
(h) How the profit of a limited liability partnership are treated for the purpose of Tax Acts? 2 (0)
(i) Statesman publishes at the request of Mr. D.D. a libel upon Mr. S.S. Mr. D.D. agrees to indemnify the Statesman the consequences of the publication if any. Mr. S.S. sued Statesman to pay damagees. Statesman paid Rs.2,00,000 to Mr. S.S. and demanded the amount from D.D. who refused. State legal provision. 2 (0)
SECTION II (Marks 50)
(Auditing)
Marks
5. Comment on the following statements based on legal provision:
(a) Internal Auditor has a big role to play in preventing fraud. 2 (0)
(b) It is mandatory to provide cash flow statement with annual accounts of all the companies. Do you agree? 2 (0)
(c) While auditing in computer Information system, auditor should make assessment of inherent risk. 2 (0)
(d) M/s S.S. & Associates, Chartered Accountants who were appointed as Auditor by the members in A.G.M. refuses to accept the appointment. In such cases Central Govt. only appoint another Auditor. 2 (0)
(e) ABC Ltd. is not listed on any stock exchange. Hence provision relating to Audit Committee is not applicable. 2 (0)
(f) Interest on loan for purchase of raw materials is included in the cost of production. 2 (0)
(g) ABC Ltd. has made provision for payment of dividend out of capital redemption reserve fund. 2 (0)
(h) Auditor has no liability to the third party as there is no contract between Auditor and third party. Do you agree? 4 (0)
6. (a) As per India GAAP there is no requirement as to disclosure of assets and liabilities. State correct position. 2 (0)
(b) As an auditor, how you will verify the loan against security of stock and shares? 2 (0)
(c) To avoid liability, Auditor in his Report remarked that “I have relied upon the review of purchases undertaken by the Internal Auditor”. – Can he avoid his liability? 2 (0)
(d) Under information system, auditor is to verify different types of audit. As an auditor,what are the items you will cover? 4 (0)
(e) Management Audit is useful for society as large. ‘ Comment. 2 (0)
(f) As a Branch Auditor how you will conduct Branch Audit? 3 (0)
(g) How you will audit the Depreciation 3 (0)
7. (a) Explain how the following are dealt with under the CARO:
(i) Inventory;
(ii) Public Deposit.
3+3 (0)
(b) Bright Ltd. was incorporated on 1.6.09. Mr. E who was related to the Chairman of the Company was appointed as Auditor of the company by the Director in its meeting held on 14.7.09. Whether the appointment was valid? 3 (0)
(c) How you will deal with the following which have not been reflected in the company’s accounts?
(i) Plant valuing Rs.10,000 was ordered before the year end but has not been delivered.
2 (0)
(d) Concept of materiality in audit has no relevance. Do you agree? 2 (0)
(e) How you will verify “copy right” ? 3 (0)
(f) How the previous year’s transaction are adjusted and treated in current year’s accounts? 2 (0)
8. (a) Management audit is beneficial to the Foreign Collaborators also. How? 2 (0)
(b) In conducting information system audit, auditor is to be guided by systematic approach. — Comment. 2 (0)
(c) In case of ABC Pvt. Ltd. whose paid up capital is Rs.80 lakhs, accumulated loss is Rs.20 lakh and misc. expenditure of Rs.15 lakhs (yet to be written off) Whether the auditor is to report under CARO? 2 (0)
(d) To comply with CARO in respect of “fixed deposit”, the auditor is to report on certain points. – What are those? 2 (0)
(e) As an Internal Auditor how you will audit the ‘Sales Return’ ? 2 (0)
(f) Internal Audit and Internal Control are one and same. Explain. 2 (0)
(g) Find out the difference between India’s GAAP and US GAAP in respect of “Related party transactions”. 2 (0)
(h) It is mandatory that all the companies and the auditor shall disclose fundamental accounting assumptions in the accounts. – State the correct position. 2 (0)
(i) In course of audit, auditor advised to amend the Profit & Loss A/c. Which was faulty but the directors did not follow his advice. As an auditor, what you will do? 2 (0)

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