Tips for Cost Audit and Operational Audit Paper

Started by Mr. Patel, February 01, 2014, 12:25:44 pm

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Mr. Patel

Tips for Cost Audit and Operational Audit Paper of ICWAI (CMA) Final
Hello Friends:

I  am MBA Graduate and recently given CMA final Group 4 exam. Right now I am waiting for my result.

Here, in the following Para I will share the tips to clear the Cost audit Paper of Group 4 of CMA Final.

The very First thing I want to share with you all is that 'Cost Audit Paper is the easiest among the all other Paper', yes, that's true. Cost Audit Paper is scoring Paper in CMA Final exam.
Following are the certain points to be considered for the Cost Audit Paper:

I strongly suggest you to refer any reference book for Cost Audit especially if you are from the 2008 syllabus. The Cost Audit rules given in the institute module are no longer valid. We have the Cost Audit rules 2011 in syllabus, where as the institute module is still consisting of old rules.

Ø  You can refer Kunal Baneerji Cost Audit Rules 2011 book for your Cost Audit.

Ø  Do not forget to do all the Cost Accounting Standard. For the Convience of Students, Institute has already provided a Compendium on Cost Audit only consist of Cost Accounting Standard. Refer compendium only for Cost Accounting standard. No need of referring other book, even there is no need of referring the Cost Accounting rules from the institute module or Kunal Baneerji book, if you have done it through compendium.

But please make a note that in Compendium there is only 13 Accounting standards. While on other side there is around 17 Cost Accounting Standard in our Syllabus for December 2013 Papers and will be increase in future. So download the other Cost Accounting standards from here:

Ø  After Cost Accounting Standard, Next Important Topic is Cost Accounting Record Rules. But before that we will complete another Chapter 'Cost Accounting Report Rules', since Record Rules chapter is lengthy than Report rules.

Ø  Refer the theory from any reference book but Practical Problem must be done from the Scanner Only.  One Practical Problem is compulsory asked from this chapter and mostly it is related to Ratio or financial statement analysis OR Value added statement.

One must not left any question of the Scanner. This is because around 80 percent of theory and 95% of practical questions are asked from Scanner. But please note that in Scanner, many questions are related to Old Cost Audit rules that should be avoided. Refer only latest Cost Audit questions only.

Ø  After Cost Audit Report Rules, Now move toward the Cost Audit Report Rules consist of 6 Industry Specific Rules. You can avoid the 6 Industry specific rules, since the content is more and questions asked from the 6 industry specific rules in less.

How can you say that?

The weighted of this chapter is 20 to 25 % and one compulsory practical question is asked from this chapter too. So in that case 15 marks will be covered by practical question and remaining 10 marks will be from the theory. Further, for the 10 marks theory there are lots of content in the chapter to be asked other than 6 industry rules. And suppose if in case they asked any question from this then you can skip it in OR question during exam.

Ø  Last but not Least, Chapter One the Basic Introduction. No doubt the weighted is low as compared to other chapter. But one must start the preparation with this chapter to have clear understanding about the subject.

Ø  Some important Points for Cost Audit Papers:

1) Scanner and Compendium is must be prepared  for the exam viewpoints
2) All the latest Cost Accounting Standard are must be prepared for the exam.
3) Last or Latest Cost Accounting Standard are more Important form the exam viewpoints.
4) For Objectives question Scanner is enough. Around 60% objectives are from scanner.  For remaining 40% you must be clear with theory.
5) Do not forget to mug up the Accounting standard number and Para number of the Report rules. In most of the question including objective question, instead of the name of the standard or para, number is given. For example: Draw the Performa of Para 5?
6) Scanner+ Compendium + Suggested Answer is enough to score more than 50 marks in Cost Audit Papers.

All the above weighted are in percentage format and since Cost Audit papers is divided in to two parts named as Cost and Operational Audit, all above tips are related to Cost Audit only.

Following are the tips for Operational Audit: 

Ø  Easiest Paper among all paper in group 4
Ø  Around 90% of the questions are repeated in Operational Audit. Therefore the Scanner is must for the Operational Audit.
Ø  For Objective Question refer the Scanner Last year objectives.
Ø  No reference book is required for this subject.
Ø  You can skip the topic related to points to be considered while doing the cost audit given in Management Audit chapter or read it once. This is because enough though a compulsory question is asked from that chapter, you can write the answer on your own.
  For example: Points to be consider for Cenvat Audit?
You can write this answer without any preparation and good news is that this types of question are even repeated from the last year Suggested answer. So refer Scanner for the same.
Ø  Scanner is enough for the operational Audit if you want to pass the exam
Ø  No need of Reference book or compendium (Which is even not provided).
Ø  Scanner + Suggested Answer + Institute module is enough to score more than 60 % in exam.
Ø  In Operational Audit, one question would be totally practical based like case study. Of course, you can skip in with other OR questions.

At Last I would like to say only one thing that Cost Audit and Operational Audit is the one of the easiest papers in CMA. It is scoring subject and even most of the questions are repeated from the past year questions.

You can share here on this website, if you have any query with related to this subject or CMA.

All the Best....!!!

Mr. Patel

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