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How to prepare Commerce and Accountancy Optional for UPSC | Career Launcher

Commerce and accountancy is the most favorable optional subject for UPSC aspirants with a commerce background. The topics included under commerce and accountancy optional for UPSC are accounting, cost accounting, taxation, auditing, financial management, financial markets, organizational theory and behaviour, human resource management and industrial relations.

In this article, we have discussed detailed syllabus for commerce and accountancy optional as well as booklist and a topper-proof strategy for preparing this optional subject for UPSC Mains Exam. Let’s get started.

Commerce and Accountancy Syllabus For UPSC

Commerce and accountancy optional syllabus for Paper-1

1.1

Accounting as a Financial Information System; Impact of Behavioural Sciences. Accounting Standards e.g., Accounting for Depreciation, Inventories, Research and Development Costs, Long-term Construction Contracts, Revenue Recognition, Fixed Assets, Contingencies, Foreign Exchange Transactions, Investments and Government Grants, Cash Flow Statement, Earnings Per Share

1.2

Accounting for Share Capital Transactions including Bonus Shares, Right Shares, Employees Stock Option and Buy-Back of Securities.

1.3

Preparation and Presentation of Company Final Accounts. Amalgamation, Absorption, and Reconstruction of Companies.

2.1

Cost Accounting:  

Nature and Functions of Cost Accounting. Installation of Cost Accounting System. Cost Concepts related to Income Measurement, Profit Planning, Cost Control and Decision Making.

2.2

Methods of Costing: Job Costing, Process Costing, Activity Based Costing. Volume – cost – Profit Relationship as a tool of Profit Planning.

2.3

Incremental Analysis/ Differential Costing as a Tool of Pricing Decisions, Product Decisions, Make or Buy Decisions, Shut-Down Decisions, etc.

2.4

Techniques of Cost Control and Cost Reduction: Budgeting as a Tool of Planning and Control. Standard Costing and Variance Analysis.

2.5

Responsibility Accounting and Divisional Performance Measurement.

3.1

Taxation

Income Tax: Definitions; Basis of Charge; Incomes which do not form Part of Total Income. Simple problems of Computation of Income (of Individuals only) under Various Heads, i.e., Salaries, Income from House Property, Profits and Gains from Business or Profession, Capital Gains, Income from other sources, Income of other Persons included in Assessee’s Total Income.

3.2

Set – Off and Carry Forward of Loss.

3.3

Deductions from Gross Total Income. Salient Features/Provisions Related to VAT and Services Tax.

4.1

Auditing:

Company Audit: Audit related to Divisible Profits, Dividends, Special investigations, Tax audit. 

4.2

Audit of Banking, Insurance, Non-Profit Organizations and Charitable 

4.3

Societies/Trusts/Organizations.

5.1

Financial Management:

Finance Function: Nature, Scope, and Objectives of Financial Management: Risk and Return Relationship. Tools of Financial Analysis: Ratio Analysis, Funds-Flow, and Cash-Flow Statement.

5.2

Capital Budgeting Decisions: Process, Procedures and Appraisal Methods. Risk and Uncertainty Analysis and Methods.

5.3

Cost of capital: Concept, Computation of Specific Costs and Weighted Average Cost of Capital. CAPM as a Tool of Determining Cost of Equity Capital.

5.4

Financing Decisions: Theories of Capital Structure – Net Income (NI) Approach, Net Operating Income (NOI) Approach, MM Approach and Traditional Approach. Designing of Capital structure: Types of Leverages (Operating, Financial and Combined), EBIT- EPS Analysis, and other Factors.

5.5

Dividend Decisions and Valuation of Firm: Walter’s Model, MM Thesis, Gordan’s Model Lintner’s Model. Factors Affecting Dividend Policy.

5.6

Working Capital Management: Planning of Working Capital. Determinants of Working Capital. Components of Working Capital Cash, Inventory and Receivables.

5.7

Corporate Restructuring with focus on Mergers and Acquisitions (Financial aspects only).

6.1

Financial Markets and Institutions:

Indian Financial System: An Overview Money Markets: Participants, Structure and Instruments. Commercial Banks. Reforms in Banking sector. Monetary and Credit Policy of RBI. RBI as a Regulator.

6.2

Capital Market: Primary and Secondary Market. Financial Market Instruments and Innovative Debt Instruments; SEBI as a Regulator.

6.3

Financial Services: Mutual Funds, Venture Capital, Credit Rating Agencies, Insurance and IRDA.



Commerce and Accountancy Optional Syllabus for Paper-II

1.1

Organisation Theory:

Nature and Concept of Organisation; External Environment of Organizations -Technological, Social, Political, Economical and Legal; Organizational Goals – Primary and Secondary goals, Single and Multiple Goals; Management by Objectives.

1.2

Evolution of Organisation Theory: Classical, Neo-classical and Systems Approach.

1.3

Modern Concepts of Organisation Theory: Organisational Design, Organisational Structure and Organisational Culture.

1.4

Organisational Design–Basic Challenges; Differentiation and Integration Process; Centralization and Decentralization Process; Standardization / Formalization and Mutual Adjustment. Coordinating Formal and Informal Organizations. Mechanistic and Organic Structures.

1.5

Designing Organizational structures–Authority and Control; Line and Staff Functions, Specialization and Coordination.

1.6

Types of Organization Structure –Functional. Matrix Structure, Project Structure. Nature and Basis of Power, Sources of Power, Power Structure and Politics. Impact of Information Technology on Organizational Design and Structure.

1.7

Managing Organizational Culture.

2.1

Organisation Behaviour:

Meaning and Concept; Individual in organizations: Personality, Theories, and Determinants; Perception – Meaning and Process.

2.2

Motivation: Concepts, Theories and Applications. Leadership-Theories and Styles. Quality of Work Life (QWL): Meaning and its impact on Performance, Ways of its Enhancement. Quality Circles (QC) – Meaning and their Importance. Management of Conflicts in Organizations. Transactional Analysis, Organizational Effectiveness, Management of Change

3.

Human Resources Management (HRM) :

Meaning, Nature and Scope of HRM, Human Resource Planning, Job Analysis, Job Description, Job Specification, Recruitment Process, Selection Process, Orientation and Placement, Training and Development Process, Performance Appraisal and 360° Feed Back, Salary and Wage Administration, Job Evaluation, Employee Welfare, Promotions, Transfers and Separations.

4.1

Industrial Relations (IR):

Meaning, Nature, Importance and Scope of IR, Formation of Trade Unions, Trade Union Legislation, Trade Union Movement in India. Recognition of Trade Unions, Problems of Trade Unions in India. Impact of Liberalization on Trade Union Movement.

4.2

Nature of Industrial Disputes: Strikes and Lockouts, Causes of Disputes, Prevention and Settlement of Disputes.

4.3

Worker’s Participation in Management: Philosophy, Rationale, Present Day Status and Future Prospects. Adjudication and Collective Bargaining.

4.4

Industrial Relations in Public Enterprises, Absenteeism and Labour Turnover in Indian Industries and their Causes and Remedies.

4.5

ILO and its Functions

How to prepare Commerce and Accountancy For UPSC

Here’s the topper-proof strategy to prepare commerce and accountancy optional for UPSC:

#1 Mind-Map the syllabus and Previous year questions

The first step is to go through the syllabus extremely carefully and mind-map the topics. You should be able to filter out the syllabus-centric topics in order to avoid distractions. Next, go through the previous year questions as a lot of times they are repeated in different ways.

#2 Practice the practical questions multiple times

The practical questions of previous year are also important as they set the tune for the expected questions. Solve them multiple times so that you can attempt these questions in minimum time during the exam.

#3 Revise theory part extensively

The theory part should be revised consistently to retain as much content as possible. Paper-1 is a mix of theory and practical questions while Paper-2 is more on theoretical side. Hence, stick to the syllabus and cover each topic comprehensively.

#4 Practice diagrams and flowcharts

Now, both the paper have a lot of diagrams and flowcharts that can provide you an edge if you incorporate them in your answers. Hence, practice them multiple times well before the exam. Make sure to incorporate relevant diagrams and flow charts in your answers.

#5 Make your notes comprehensive

If you're making handwritten notes, make sure they are comprehensive yet extremely to-the-point. Do not write long sentences and make them bulky and wordy. Consolidate your notes and constantly keep updating them with current affairs.

Booklist for Commerce and Accountancy for UPSC

Here's the best booklist for commerce and accountancy optional for UPSC:

Paper

Booklist

Paper-1

1. Accounting:

  • Fundamentals of corporate accounting--J.R.Monga

  • Accounting standards - ICAI publications.


2. Cost accounting:

  • Fundamentals of management accounting -- Anthony & Welsch

  • Cost accounting; Theory & problems--Maheshwari & Mittal


3. Auditing:

  • Students' guide to auditing— Aruna Jha (taxmann publishers)


4. Income tax

  • Students' guide to income tax--V.K.Singhania; OR

  • Systematic approach to income tax --Girish Ahuja


5. Financial management:

  • Financial management -- R. P. Rustagi

  • Financial management; Text & problems--Khan & Jain


6. Financial markets & institutions:

  • Indian financial System--Y.Khan; OR

  • Financial institutions & markets--l.M.Bhole


Periodicals

  • The chartered accountant (journal of the institute of chartered accountants of India)

  • The economic survey (Govt. Of India publication)

  • Financial/business section of the Times of India or any other daily newspaper

Paper-2

Section A: Organization theory & behavior

  • Organisation theory & behaviour—b.P singh & t.N. Chabra

  • Organisational behaviour--stephen p. Robbins

  • Organizational behavior—Fred luthans

  • Management of organisational behaviour-- paul hersey & ken blanchard


Section B: Human resource management

  • Human resource management -c.B gupta

  • Human resource and personnel management –k. Ashwathapa

  • Human resource management -vsp rao 


Industrial relations

  • Industrial relations in indian enterprises--r.S.Dwivedi

  • Dynamics of industrial relations--c.B.Mamoria, satish mamoria & s.V. Gankar

  • Industrial relations--t.N.Chhabra & r.K.Suri

  • Relevant articles from the following journals:

  • Indian journal of industrial relations

  • Indian journal of labour economics

Reports/publications of the central govt/govt committees concerning labour policy

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