Accounting Regulations and Policies:
Need for accounting
regulations and standards. Accounting
assumptions, bases of recognition and
measurement and accounting policies as required
under Framework for the Preparation and
Presentation of Financial Statements and
International Accounting Standard-Presentation
of Financial Statements (IAS-1) issued by
International Accounting Standards Board (IASB).
Need for disclosure and its requirements under
the Companies Ordinance, 1984.
Accounts of Limited Companies:
Preparation and presentation
of financial statements (balance sheet, profit
and loss accounts, cash flow statement and
statement of changes inequity) of limited
companies and preparation of specific notes,
extracts, schedules, reports of directors and
auditors in line with statutory provision and
international accounting standards.
Consolidated Financial Statements:
Definition of holding,
subsidiary and associated undertaking and
companies. Comparison and usefulness of
acquisition and merger method of consolidation.
Techniques of consolidation requiring accounting
and disclosure requirements of IAS-22 and IAS-27
and the Companies Ordinance, 1984 relating to
consolidated financial statements including
calculation of premium or discount on
acquisition, minority interest, elimination of
intra group transactions and balances,
inter-company profits and dividends. Accounting
for investments in subsidiaries and associated
under takings.
Specialized Accounting Treatments:
-
Accounting for Property , Plant and
Equipment (IAS-16) Recognition
and initial measurement of property, plant
and equipment, measurement subsequent to
initial recognition of asset, property,
plant and equipment including exchange of
assets, subsequent expenditure,
revaluations, depreciation, review of useful
life, review of depreciation methods,
impairment of assets, retirement and
disposals. Treatment of surplus on
revaluation of property, plant and equipment
under section 235 of the Companies
Ordinance, 1984 and under IAS-16. Disclosure
requirements for property, plant and
equipment under IAS-16 and the Companies
Ordinance, 1984.
-
Accounting Treatment of Intangible Assets
(IAS-38) Treatment of
intangible assets including research and
development costs including their
recognition, amortization and impairment of
development costs.
-
Accounting for Inventories Cost
and measurement of inventories, cost
formulae, net realizable value, recognition
of inventory as an expense. Compliance with
the requirements of IAS-2 and the Companies
Ordinance, 1984.
-
Accounting for Leases (IAS-17)
Definition of lease, installment sales and
hire purchases, their importance and
difference between them. Accounting for
operation and finance leases. Complications
in lease accounting, recognition of income
in installment sales and hire purchases.
Disclosure requirements under IAS-17 and the
Companies Ordinance, 1984.
-
Accounting for Contracts (IAS-11)
Accounting for work-in-progress,
work-certificate and payments,
work-in-progress uncertified, profit on
incomplete contract, preparation of contract
account, profit and loss account and balance
sheet.
-
Accounting Treatment of Net Profit and Loss
For the period including profit
or loss from ordinary activities, changes in
accounting estimates, fundamental errors,
change in accounting policies, events
occurring after balance sheet date.
Accounting treatment of contingent losses
and gains (IAS-8 and 10).
-
Taxation Treatment of current
and deferred taxation in accounts (IAS-12).
-
Accounting for Capital Structure
Accounting of issue of shares and
securities . Buy back of shares.
Reconstruction of capital, merger and
de-merger of companies.
-
Recognition of Borrowing Costs (IAS-23). (j)
Accounting Treatment of Foreign Currency
Transactions (IAS-21)
Specific Reporting:
-
Interim Financial Reporting (IAS-34)
Preparation, presentation and
disclosure requirements with regard to
interim financial statements of companies.
-
Reporting on Related Party Disclosures
Transfer pricing. Disclosure
requirements under IAS-24 and the Companies
Ordinance, 1984.
-
Reporting on Discontinuing Operations
Recognition, measurement,
presentation, disclosure of discontinuing
operations as required under IAS 35.
-
Reporting on Earning Per Share
measurement, presentation and disclosure
requirements of earning per share in line
with IAS-33.
Analysis and Interpretation of Financial
Statements :
Needs for various users of
financial statements and importance thereof.
Techniques for analysis; horizontal, vertical
and ratio analysis and common-size statements,
their uses and limitations. Detailed examination
and analysis of accounts and other financial
information regarding capital structure,
asset-base, liquidity, cash flow and operating
capabilities, earning per share, working capital
level and controls. Reporting in good style, the
analysis, evolution and recommendation arising
for the examination to the management, investors
and creditors.
Measurement of Profit:
Traditional approach using
legal transaction as basic income and
expenditure. Economists approach to income and
measurement of profit as an increase in the
value of business. Consideration of alternative
approach to the measurement of profit in a
changing price level environment. Use of
replacement, net realizable value and economic
value for the valuation of property, plant and
inventories.
Performance Reporting, Planning and Control:
Analysis and classification
of costs for performance reporting. Product
costing and elements of costs. Profit planning
and break-even analysis. Introduction of
different cost analysis. Introduction to budgets
for planning and control including cash
budgeting.
|
Module
B |
|
Group
4 |
|
Code
242 |
CORPORATE TAX
MANAGEMENT
OBJECTIVE
To provide knowledge and understanding of
the core areas of direct and indirect tax laws
and develop understanding of their implications
in different business situations and apply these
in financial planning and decision making.
SYLLABUS
|
SECTION - 1 |
|
DIRECT TAX |
|
( 50 Marks ) |
Basic Framework of Direct Tax Law:
Different direct tax laws and their
inter-relationship in the scheme of taxation in
Pakistan. Importance of Income Tax Ordinance,
2001 and amendments there in through Finance
Act/Ordinance annually and concepts of prior tax
ruling.
Detailed Study of Income Tax Law:
The Income Tax Ordinance,
2001 and the Income Tax Rules 2002 as amended
up-to-date covering: definition, charge of tax,
tax on income from salary, property, business,
capital gains, other sources (including income
from dividend, royalty, profit on debt, etc),
exemptions, deductions allowed and not allowed,
tax credits, set off and carry forward of losses
relating thereto and tax depreciation. Common
Rules: general, tax year and assets. Provisions
governing persons; associates, individuals,
association of persons and Companies. Taxation
of foreign source of income of residents. Tax
accounting. Transfer pricing. Records and books
of accounts. Filing of various statements with
income tax authorities.
Employee Remuneration:
Tax implications of employee
compensation scheme: salaries, wages,
perquisites, gratuity, bonus, commission, etc.
Managerial remuneration its tax implications and
planning consonant with Income Tax law
requirements.
Tax
Management:
Nature and areas of tax management, deduction of
tax at source, advance payment of tax, minimum
tax. Importance of tax management while claiming
allowances, exemption, deductions and tax
credits. Filing of returns of income, defaults
and penalties. The organization problems of tax
management review. Assessment procedure,
appeals, collection and recovery of tax,
payments and deductions, refunds, records and
audit, penalty, additional tax, offence and
prosecution. Review of assessment order in order
to decide availability of further appeal,
revision review or rectification, drafting
ground of appeal, argument on appeal, memoranda
to the Central Board of Revenue and other
similar applications.
Corporate Taxation:
The income tax liabilities of
companies and tax incidence under the Income Tax
law. Capital structure of a company and tax
incidence, tax as a variable in computing cost
of capital, tax considerations in dividend
policy and issue of bonus shares. Taxation of
inter-corporate dividends and transfers.
Tax
Planning:
Planning and scope of tax
planning. Difference between tax planning, tax
evasion and tax avoidance. Tax planning its need
and methodology. Tax planning with reference to
type of activity, scale of activity, ownership
pattern, location aspects, etc. Limitations on
the tax planning exercise, flexible planning
premises. Tax planning in the context of court
rulings and legislative amendments. Planning for
tax holiday benefits. Setting up of new
industrial undertaking for availing exemption.
Merger with sick units. Amalgamation, merger and
de-merger and tax planning.
Tax Consideration with regard to Specific
Management Decision:
Consideration of tax benefit
while management decision to make or buy, own or
lease, return or replace, prepare or renovate,
now or later, slow or fast, close or continue
operation. Tax consideration relating to
variation of portfolio of assets, change of tax
year and method of accounting.
Taxation of Non-Residents:
Basic principles for taxation
of non-residents, special deduction. Foreign
collaboration agreements and tax implication;
joint venture abroad and tax consideration,
procedure for joint venture and foreign
collaboration.
Double Taxation Avoidance Agreements:
Meaning of avoidance of
double taxation and prevention of fiscal
evasion. Tax implications of double taxation
avoidance agreements and standard practice with
regard to tax law for company secretaries.
|
SECTION - 2 |
|
INDIRECT TAX |
|
( 40 Marks ) |
Framework of Indirect Tax Laws:
Special features of indirect tax levies. Role of
indirect tax laws and contribution to government
revenues and fiscal performance as instrument of
planning and development.
Sales Tax Act 1990:
Particularly Chapters I to V
and VII of the Act and Turnover Tax Rules 1999.
Apportionment of Input Tax Rules 1996. Filing of
Monthly Return Rules 1996, Registration,
Voluntary Registration and De-registration Rules
1996 and Retail Tax Rules 1998 and Sales Tax
Ordinance 2000 promulgated by the provinces as
amended up-to-date covering: definitions, scope
and payment of Sales Tax, registrations,
book-keeping and invoicing requirements. Sales
in the course of import and export, taxability
of inter-depot and inter-branch transfer of
goods. Methods of executing sales through
branches, head office and factory. Export
contracts and implications on penultimate sale,
canalized exports-implications, planning
vis-ΰ-vis judicial pronouncement. Levy and
collection of Sales Tax procedure, offences and
penalties. Filing of returns and revision
therein. Appeals, revision and rectification of
assessment procedure. Sales Tax levies and cash
management, promissory estoppels-extent of
application to sales tax matters, a case law
review.
Customs Act 1969:
Particularly chapters V, VI,
X, XI, XVII and XIX of Customs Act 1969 as
amended up-to-date covering: details of
procedure in relation to levy, collection and
exemption from and repayment of custom duties,
drawback and documents to be prepared and
presented to custom authorities; valuation of
goods , classification of goods, its principles
and rectifications; valuation of goods for the
purpose of levy and its principles, abatement of
duties and availing of exemptions; procedure for
clearance of goods for home consumption and
clearance of imported and exported goods;
warehousing; offences, penalties, appeals and
revision. Custom levies and cash management.
Federal Excise Act 2005:
Chapter I Definitions
Chapter II Levy, collection and payment of
duty
Chapter III Offences and Penalties
Chapter V Power, Adjudication and Appeals.
Federal Excise Rules 2005.
