CAP III

CAP-III Level course including a three years practical training is designed to enhance a deeper and advanced level of professional expertise on the subjects. During CAP III, student is required to go through a paid internship/articleship of 3 years.

Admission Eligibility

To enroll in the CAP-III Level, a candidate must have

  1. Passed CAP II level (Both groups)
  2. Registered as an Article Trainee under a practicing Chartered Accountant by signing a deed of articleship. This signed deed of articleship should be submitted to ICAN within 1 months of signing.

Registration Deadline

CAP II registration are open all over the year. However student shall register in CAP II at least 2 years before the CAP III exams. CAP II exams are held similarly in June and December. Two registration are to be done,

First: Articleship registration
Second: CAP III registration

To be eligible for CAP II exams in December (say 20X5),

  • 2 years of registration should be covered till November 30, 20X5
  • Which means the last date for registration will be December 1, 20X3 
  • Generally, students who appear for CAP II in June exams, their results of CAP II are declared during the mid of August. These students generally have 3.5 months for CAP II registration to get nearest exams. 

To be eligible for CAP II exams in June (say 20X6),

  • 2 years of registration should be covered till May 31, 20X6
  • Which means the last date for registration will be June 1, 20X4 
  • Generally, students who appear for CAP II in December exams, their results of CAP II are declared during the mid of February. These students generally have 3.5 months (February Mid to June 1) for CAP II registration to get nearest exams. 

Course Structure

Paper 1: Advance Financial Reporting(One Paper - Three Hours - 100 Marks)

Paper 1: Advance Financial Reporting requires an expert level of knowledge and is designed to

• Assist the candidates in figuring out the importance of “Nepal Financial Reporting Standards” and its historical background.
• Create financial documents, such as the consolidated financial statements for limited liability corporations and other specialized organizations, using standards and providing an explanation of their presentations.
• Provide users with useful interpretations of accounting records as well as other data.

Exams of Paper 1 is of 100 marks where all the questions are subjective in nature.

The subject matter contains:

  1. Accounting principles and concepts
  2. Financial Reporting Standards
  3. Preparation and presentation of financial statements
    • Advanced problems in preparation and presentation of financial statements
    • Valuation of goodwill, shares and business.
    • Disclosure as per standards included
    • Understanding recent development in accounting
  4. Preparation of consolidated financial statements
  5. Accounting for business combinations
  6. Statement of Cash Flows
  7. Accounting for foreign currency transactions
  8. Analysis and interpretation of financial statements and related information
  9. Accounting treatments for specialized transactions
  10. Public Financial Management and Government Accounting

Paper 2: Advance Financial Management(One Paper - Three Hours - 100 Marks)

Paper 2: Advance Financial Management requires an expert level of knowledge and is designed to

• To acquire a complete knowledge of the complex difficulties related to financial management as well as the characteristics of financial management in a worldwide context.

Exams of Paper 2 is out of 100 marks where all the questions are subjective in nature.

The subject matter contains:

  1. The Financial System
  2. Financial Intermediaries
  3. Capital Markets
  4. Valuation of Assets, Shares and Companies
  5. Investment Decisions and Strategies
  6. International Financial Management
  7. Portfolio Theory & Assets Pricing
  8. Foreign Exchange Management
  9. Emerging Concept of Financing
  10. Foreign Direct Investment

Paper 3: Advanced Auditing(One Paper - Three Hours - 100 Marks)

Paper 3: Advance Auditing requires an expert level of knowledge and is designed to

•  To enhance applicants’ abilities in conducting and disclosing audits and assurances in order to improve the accuracy of financial and non-financial data.
• To increase applicants’ ability to recognize important risks and use tools for risk evaluation in the engagement
• To increase candidates’ capacity to locate, collect, and evaluate information to determine whether it is adequate and suitable for an audit engagement.
• To determine whether applicants have the necessary skills to offer thorough audit and business assurance services by evaluating their aptitude for integrating and applying their auditing knowledge to practical issues.

Exams of Paper 3 is out of 100 marks where all the questions are subjective in nature.

The subject matter contains:

  1. General concepts
    • Auditing
    • Governance
  2. Audit process
    • Engagement Procedure
    • Planning and Risk Assessment
    • Audit Test
    • Audit Reporting
    • Audit of specialized enterprises
  3. Other services
    • Assurance and related services
    • Other services
  4. Audit issues
    • Audit under computerized environment
    • Computer Assisted Auditing Techniques
    • Fraud and auditors’ liability
    • Audit of fair values

Paper 4: Corporate Laws(One Paper - Three Hours - 100 Marks)

Paper 4: Corporate Laws requires an expert level of knowledge and is designed to

• Become knowledgeable about Nepalese corporate laws and how they are used in practice.

Exams of Paper 4 is out of 100 marks where all the questions are subjective in nature.

The subject matter contains:

  1. Nepal Chartered Accountants Act, 2053 & Regulation, 2061
  2. The Companies Act, 2063 and Rules
  3. Securities Act, 2063 and Rules
  4. Banks and Financial Institutions Act, 2073
  5. Nepal Rastra Bank Act, 2058
  6. Industrial Enterprises Act, 2073
  7. Foreign Investment and Technology Transfer Act, 2073
  8. Labor Act, 2074
  9. Insurance Act, 2049 and Rules
  10. International Financial Transactions Act, 2054
  11. Co-operative Act, 2074 and Rules, 2075
  12. Insolvency Act, 2063
  13. Money Laundering Prevention Act, 2063
  14. Public Procurement Act, 2063 and Rules, 2064
  15. Audit Act, 2075
  16. General provisions of the following Acts

Paper 5: Management Information and Control System(One Paper - Three Hours - 100 Marks)

Paper 5: Management Information and Control System requires an expert level of knowledge and is designed to

• Emphasize the expert accountant’s position as an information system administrator and reviewer.
• Determine an organization’s information necessities differentiate between various kinds of information systems, and suggest particular approaches to meet those needs.
• Support with information system evaluation, architecture, and execution.
• Discover how to handle, regulate, and evaluate IT infrastructure and information system assets.

Exams of Paper 5 is out of 100 marks where all the questions are subjective in nature.

The subject matter contains:

  1. Organizational Management and Information System
  2. Types of Information System
  3. . Information Technology Strategy and Trends
  4. System Development Life Cycle-Acquisition, Development, Implementation, Maintenance
    and support
  5. System Analysis and Design
  6. E-Commerce and Inter-Organizational Systems
  7. E-Business Enabling Software Package
  8. Protection of Information Assets
  9. Disaster Recovery and Business continuity planning
  10. Auditing and Information System
  11. Ethics and legal Issues in Information Technology
  12. Electronic Transactions Act, 2063

Paper 6: Advanced Taxation(One Paper - Two Sections - Three Hours - 100 Marks)

Paper 6: Advanced Taxation requires an expert level of knowledge and is designed to

• Develop specialist expertise on direct and indirect taxes, as well as educate students on how to use professional knowledge in real-world situations.
• Become a specialist in the provisions of direct and indirect tax laws.
• Develop the capacity to integrate the understanding of legal provisions into a variety of scenarios.

Exams of Paper 6 is out of 100 marks where all the questions are subjective in nature.

The subject matter contains:

  1. Income Tax Act 2058 and Rules 2059
  2. Ethics and professional conduct in providing taxation services
  3. Fundamentals of taxation and Nepalese tax system, income heads
    • Basic terms used in tax law and their tax connection
    • Residential concept
    • Basis of Taxation
    • Tax Accounting
    • Calculation of income from business
    • Calculation of income from employment
    • Calculation of income from investment
    • Deductions allowed from taxable income
    • Calculation of net gains from disposal of assets and liabilities
    • Tax Credits
    • Quantification, allocation and characterization of amounts
    • Special Provisions
  4. Administration and documentation administration, withholding and payments of tax
    • Administration tax authorities
    • Documentation
    • Tax withholding
    • Payment of Tax
  5. Returns and Assessments, Collection, Remission and refund
    • Returns
    • Assessments
    • Collection
    • Remission and Refund
  6. Legal Remedies, Interest, Fees, Penalties Offences
    • Administrative review
    • Appeal
    • Interest
    • Fees
    • Penalties
    • Offence
  7. Value Added Tax Act, 2052 and Rules 2053
    • Introduction, coverage and administration
    • Tax Authorities, revision and appeal and fees and interest
  8. Excise Act, 2058 and Excise Rules 2059
  9. Customs Act, 2064 and Rules 2064
  10. Double tax avoidance agreement (DTAA) and international taxation
    • Double Tax Avoidance Agreement (DTAA)
    • International Taxation

Paper 7: Advanced Cost and Management Accounting(One Paper - Three Hours - 100 Marks)

Paper 7: Advanced Cost and Management Accounting requires an expert level of knowledge and is designed to

• Learn about cost accounting in the context of organizational functions.
• Offer expertise regarding applying costing data for making choices, supervision, and awareness of developing methods of evaluation of performance and operational investigation.

Exams of Paper 7 is out of 100 marks where all the questions are subjective in nature.

The subject matter contains:

  1. Advanced Cost Accounting
    • Cost concepts and objectives of Costing systems
    • Marginal Costing and Decision making problems
    • Standard Costing and Variance analysis
    • Budget & Budgetary Control
    • Performance measurement
    • Activity Based Costing
    • Costing of Service Sector
    • Pricing Strategies
  2. Emerging concepts in cost management
    • Just in time approach
    • Material Requirement Planning (MRP)
    • Enterprise Resource Planning (ERP)
    • Total Quality Management (TQM)
    • Life cycle costing
    • Target costing
    • Value chain analysis
    • Cost Audit
  3. Quantitative Techniques
    • Linear Programming
    • Transportation Problems
    • Assignment Problems
    • Network Planning-PERT/CPM
    • Simulation
    • Learning Curve Theory

Paper 8: Strategic Management and Decision Making Analysis(One Paper - Three Hours - 100 Marks)

Paper 8: Strategic Management and Decision-Making Analysis requires an expert level of knowledge and is designed to

• Enhance knowledge and comprehension of the processes, ideas, and methods associated with strategy management and decision-making evaluation essential for an expert in accounting.
• Acquire the ability to create and execute plans and evaluate outcomes in the Nepalese scenario.

Exams of Paper 8 is out of 100 marks where all the questions are subjective in nature.

The subject matter contains:

  1. Concept of Strategy
  2. Strategic Management
  3. External Environment Analysis
  4. Internal Analysis
  5. Strategic options
  6. Strategy Formulation and Strategic Choice
  7. Strategy Implementation and Evaluation
  8. Role of Chief Executive in Strategic Management
  9. Decision-Making Process and Techniques
  10. Project Management
  11. Strategic Management and Decision-Making Practices in Nepal

Exams and Passing Criteria

Hall Test  (For Being Eligible To Write CAP III Exams) (No Postal Exams in CAP III)
For appearing in the CAP-III examination, students should complete the Pre-test exams (Only Hall test and no option of Postal test). Students should pass in at least one paper in each subject with a minimum of 40% marks in Hall Test Scheme.

Eligibility for CAP III Exams
A candidate appearing in the CAP-III Examination must have

  1. Completed two years from the date of registration in CAP-III Course,

  2. Obtained the eligibility certificate of Pre-Test Exam, and

  3. Completed the prescribed period of practical training, i.e. 3 years or has yet to serve not more than 12 months of articleship prior to the first day of the month in which Examination is held.

A candidate can appear either the both groups at a time or in one group in one examination and the other group at any subsequent examination.

 

CAP III Exams
Like CAP I and CAP II, CAP III exams are also held generally in the first week of June and December. No gap is given during the exams except for Saturdays and public holidays. Routine and centre list are published in the ICAN’s official website at least 30 days before the exams.

Passing Criteria
A candidate will be declared to have passed CAP-III Examination only if he passes in BOTH the groups. However student can pass both the groups at once or one by one. For eg, student can pass Group 2 in one exams and sit and pass Group 1 in another exams. However the student would be declared having passed CAP III only after passing both the groups.

A candidate will be declared to have passed in both groups simultaneously if  at one sitting

i)  a minimum of 40% in each paper of each of the group and an aggregate of 50% of all the papers of each of the groups is secured OR

ii)  a minimum of 40% in each paper of both the groups and 50% in the aggregate of all the papers of both groups taken together is secured .

A candidate shall be declared to have passed in one group if

i) At one attempt a minimum of 40 % in each paper of the group AND 
ii) 50% in the aggregate of all the papers of that group.

 

Exemption

A student who has scored 60% or more in any paper(s) but has failed in that group, shall be entitled for exemption in that particular paper(s), provided,  a minimum of 30% in any one of the subjects of that group has been scored, and should have attempted all the papers in that group.
The exemption shall remain valid for the next three consecutive examinations but those students who are entitled for exemption are not considered for rank.

Distinction

A student securing 75% or above, in the aggregate of both groups, at one sitting, shall be considered to have secured distinction.

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