2017 (May)
COMMERCE (Speciality)
Course: 602 (Financial Statement Analysis)
The figures in the
margin indicate full marks for the questions
Time: 3 hours
(NEW COURSE)
Full Marks: 80
Pass Marks: 24
1.
(a) State whether the following statements are True or False: 1x5=5
i.
Financial statements disclose only monetary
facts.
ii.
The figures shown in financial statements are on
historical cost basis.
iii.
Current Ratio is calculated to compare current
assets and fixed assets.
iv.
A decrease in Stock Turnover Ratio indicates
that business is becoming more efficient.
v.
Corporate social responsibility reporting is not
mandatory for any business in India.
i.
Profit or Loss of Life Insurance business is
determined by preparing _____. (Revenue Account/Valuation Balance Sheet).
ii.
A Banking Company incorporate in India shall
have to transfer a sum equal to _____. (20%/30%) of profit to a Statutory
Reserve.
iii.
According to RBI Guidelines a Provision of
_____(20%/30%) is required for any advance remains doubtful up to one year.
iv.
Common Size Statement Analysis is known as _____
(Vertical Analysis/Horizontal Analysis).
v.
Compliance of Corporate Governance was made
mandatory by SEBI as listing requirement vide _____(Clause 49/Clause 32).
2.
Write short notes on the following (any four): 4x4=16
a) Economic
Value Added Statement.
b) Profitability
Ratio.
c) Corporate
Governance Reporting.
d) Valuation
of Investment of NBFCs.
e) Activity
Ratio.
f) Trend
Analysis.
3.
(a) What do you mean by Financial Statement? Explain the nature and objectives
of Financial Statement. 4+10=14
Or
(b)
What is Financial Statement Analysis? Explain the various techniques of analysis
of Financial Statement. 4+10=14
4.
(a) “Ration analysis is considered better than mere comparison of figures in
carrying out overall appraisal of business.” Explain how ratio analysis is
better tool for appraisal. 13
Or
(b) Debtors’ Velocity – 3 months
Creditors’ Velocity – 2 months
Stock Velocity – 8 times
Fixed Assets Turnover Ratio – 8 times
Gross Profit Ratio – 25%
Gross
Profit in the year amounted to Rs. 80,000. There is no long-term Loan and Bank
Overdraft. Reserve and Surplus amounted to Rs. 28,000. Liquid Assets are Rs.
97,333. Closing Stock is Rs. 2,000 more than Opening Stock. Bills Receivable
and Payable are Rs. 5,000 and Rs. 2,000 respectively.
Find
out (i) Sales; (ii) Sundry Debtors; (iii) Closing Stock; (iv) Sundry Creditors;
(v) Fixed Assets; and (vi) Proprietor’s Fund.
Also
prepare Balance Sheet with as many details as possible. 9+4=13
5.
(a) What do you mean by financial reporting? State the various steps adopted by
business to enhance transparency in financing reporting process. 6+7=13
Or
(b)
What is corporate social responsibility reporting? Explain the present legal
provisions of corporate social responsibility and its reporting practices in
India. 4+9=13
6.
(a) Discuss the important provisions need to be taken into consideration for
financial reporting of Insurance Companies in India and also state disclosures
requirement of their financial statements as per IRDA regulations. 7+7=14
Or
(b)
Discuss the suggestions made by RBI’s Advisory Group on Accounting and Auditing
in Financial Reporting of Banks and Financial Institutions. 14
(OLD COURSE)
Full Marks: 80
Pass Marks: 32
1.
(a) Fill in the blanks with appropriate word(s): 1x5=5
i.
Reporting of Corporate Governance reflects _____
(Company/Management Process/Earning Status/Assets and Liabilities).
ii.
Long-term solvency of the business is reflected
by _____ (Acid Test/Ratio/Debt-equity Ratio/Stock Turnover Ratio).
iii.
Accounting Standards Board (ASB) was set up in
India in the year _____ (1973/1975/1977)
iv.
The basic objective of financial statements is
to ____ (provide information/meet legal requirement/show performance of
management).
v.
Disclosure in financial statements of banks and
similar financial institutions is associated with (IAS-30/IAS-31/IAS-32)
(b)
State whether the following statements are True or False: 1x3=3
i.
Financial statements reflect the recorded facts.
ii.
The new name of Accounting Standards issued by
IASB is International Financial Reporting Standards (IFRS).
iii.
Current Ratio indicates short-term debt paying
ability of a firm.
2.
Write short notes on any four of the following: 4x4=16
a) Comparative
Statement Analysis.
b) Indian
Accounting Standards.
c) Solvency
Ratios.
d) Corporate
Social Responsibility Reporting.
e) RBI
Guidelines on Financial Reporting of NBFCs.
3.
(a) What do you mean by Financial Statement? Explain the objectives and
limitations of Financial Statement. 11
Or
(b)
“Analysis of Financial Statement is best way to judge the overall financial
health of a business.” Explain the statement with your justification. 11
4.
(a) What do you mean by Ratio Analysis? Explain the different types of Ratio
used for the purpose of Financial Statement Analysis. 12
Or
(b)
From the following information, prepare the Balance Sheet: 12
Rs.
|
|
Net Working Capital
Reserve and Surplus
Bank Overdraft
Current Ratio
Liquid Ratio
Fixed Assets to
Proprietor’s Fund
Long-term
Liabilities
|
75,000
1,00,000
60,000
1.75
1.15
0.75
NIL
|
5.
(a) What is the objectives of financial reporting? Explain the qualitative
characteristics of a good financial reporting. 4+7=11
Or
(b)
What do you mean by Corporate Governance? Discuss how good Corporate Governance
Reporting is useful to users of financial report. 11
6.
(a) What do you mean by Accounting Standards? Explain the role of Accounting
Standards for Global Harmonization of financial reporting. 4+7=11
Or
(b)
What is International Financial Reporting Standards (IFRS)? Describe the role
played by Indian accounting regulatory bodies for convergence of Indian
Accounting Standards with IFRS. 11
7.
(a) Explain the important provisions relating disclosure requirement of Banks
and Financial Institutions issued by Reserve Bank of India. 11
Or
(b)
Discuss the IRDA guidelines regarding the financial reporting of Insurance
Companies on Insurance Contract. 11
Financial Statements Analysis Question Papers Dibrugarh University
*******
*******