Thought you are good in understanding money transactions and complex ways of logically depicting and analyzing such transactions in standard form, statements and tables? If your answer is ‘yes’, you should consider pursuing professions related to Finance and Accounting. Principal among them–CA (Chartered Accountancy) and CWA (Cost & Works Accountancy)–are the ones you should choose from. These two, CA and CWA respectively awarded by the ICAI ( The Institute of Chartered Accountants of india) and the ICWAI (The Institute of Cost & Works Accountants of India), are actively pursued by majority of students who wish to make their mark in Finance, Accounting, Taxation and Business Management, to name just a few.
CA and ICWA share some common features ; both are –
- Studies primarily of a self-study mode, off-the campus pursuits ; coaching being optional
- Syllabi of studies and structure of courses well organised with clear-cut guidelines and strict compliances for qualifying to the trades and award
- Require systematic academic preparation and grooming coupled with hard work to qualify
- ICAI and ICWAI – both are professional statutory bodies of long standing and high professional reputation, recognised world over in the respective professional fraternities
- Careers, post studies, though in many ways different from one another, can be highly rewarding and satisfying, yet challenging too.
Chartered Accountancy (CA)
CA is at the core of all businesses, big or small. Work in CA involves core accounting/book keeping/auditing works coupled with related budgeting, cost accounting, taxation, financial policy & planning, investigation, consulting and guiding in all financial aspects of a firm with the external world. It deals with the internal financial structures & systems of a firm in relation to and in compliance with the external world mainly of the Statutes and Acts. As it is statutorily mandated that qualified Chartered Accountants only can do these and certify, mode of qualification in CA awarded by the ICAI is highly regulated and structured. Rigours of qualifying for CA is guided by the statute-driven responsibilities and roles that Chartered Accountants have to assume post-qualification.
Way to CA Qualification
CA course regulations under ICAI have undergone changes right from 1991-92 when a foundation course for (10+2) students was stipulated to get into intermediate and final courses of CA examinations.
In the present form, it is a completely revamped system involving CPT (Common Proficiency Test), IPCC (Integrated Professional Competence Course) Gr.1 and Gr.2 and CAFC (CA–Final Course), combined with a 3-year Articleship after IPCC Gr.1.
Salient details are :
- Entry level Test in four subjects–Accountancy, Mercantile Law, General Economics and Quantitative Aptitude.
- Eligibility for registration : After 10th Std. register for CPC and appear for CPT after (10+2) and 18 years of age.
- A basic level test with 200 scores divided between the four papers with 50% being the qualifying score and negative scoring for wrong answers.
- Held twice yearly, in June & December.
- Students can register for IPCC after qualifying in CPT directly with a 55% degree score in Commerce/PG/Graduates of BBM & others/ICWAI–ICSI Inter qualification.
- Post CPT 9 months study IPCC can be taken.
- IPCC consisting of seven subjects in two groups.
- Examinations held in May and November every year.
- First group subjects : Accounting, Business Laws, Ethics and Communication, Cost Accounting and Financial Management, Taxation.
- Second group subjects: Advanced Accounting. Auditing and Assurance and Information Technology and Strategic Management.
- Pass percentages : 40% marks in each subject and an aggregate of 50% marks in each group.
- After clearing both the groups of IPCC within the last 12 months of IPCC and undergone training for three years continuously as Article or Audit assistantship, one can take the final exam. Exams conducted in May and November of every year.
- Final exam consists of two groups with four subjects each.
- First group-Financial Reporting, Strategic Financial Management, Advanced Auditing and Professional Ethics.
- Second group- Corporate and Allied Laws, Advanced Management Accounting, Information System Control and Audit, Direct Tax Laws and Indirect Tax Laws.
- Pass percentages : 40% marks in each subject and a aggregate of 50% marks in each group.
- Post–Final : After passing the three levels, a mandatory course in General Management and Communication Skills (GMCS) to improve business communication and presentation skills.
Cost & Works Accountancy (CWA)
CWA is at the core of internal working processes and outcomes of firms and companies and it basically deals with analysis/accounting/managing the costs and financial systems within those firms and companies. The principal areas of CWA are:
- Maintaining the balance between costs and expenses on the one hand and available resources on the other.
- Planning, executing and controlling costs and expenses against resources and resource streams.
- Cost of all transactions within and outside entities as well.
- Manage, regulate and audit the costs and methods/processes of cost transactions.
- Assessing the cost feasibility of processes, products and projects.
- Managing the management accounting processes, systems and implementations.
CWA, as a work discipline is logically allied to internal management processes of the company and hence is aligned to both its operations and strategic management as well. As a course or as a profession, it has close linkages with management principles and practice. Thus a CWA practice and profession is better recognised these days as a management profession rather than just as an internal accounting practice.
The CWA course by ICWAI is highly structured and follows a clearly laid pattern with rigorous examination standards. Over the years, the course and the qualification, both have evolved into a highly acknowledged and reliable stamp of quality and utility of qualifying students capable to serve well the business and corporate world.
Way to CWA Qualification
CWA courses and curricula have more or less remained stable over the years with some changes in curricula being effected from time to time keeping to the utility and relevance of the subjects taught.
Salient details are:
- First level of the exam and students who have passed or are sitting for the 10+2 exam can take the CA/ICWA exam. The exam is held every year mostly in the months of June and December.
- The Foundation course consists of four papers. Organisation and Management Fundamentals, Accounting, Economics and Business Fundamentals and Business Mathematics and Statistic Fundamentals. Duration of the program is six months.
- Candidates with a graduate degree in Commerce not required to take this examination, eligible to give the intermediate exam directly.
- On passing the Foundation Courses, one is eligible to take the next level intermediate exam. This exam consists of two groups of three papers each.
- Group 1–Financial Accounting, Commercial and Industrial Laws and Auditing. Applied Direct taxation as test subjects.
- Group 2–Cost and Management Accounting. Operation Management and Information System as test subjects.
- Duration of this program is 12 months.
- To take the Final Exam, successful completion of intermediate level is essential. Final Exam consists of two groups of eight papers each.
- Group 1–Capital Market Analysis and Corporate Laws. Financial Management and International Finance, Management Accounting, Strategic Management and Indirect and Direct Tax Management.
- Group 2–Management Accounting-Enterprise Performance Management, Advanced Financial Accounting and Reporting, Cost Audit & Operational Audit and Ethics & Business Valuation Management. Duration of this course is also twelve months.
- On clearing the Final exam, a practical training of 36 months leading to a Certified Management Accountant (CMA) qualification required.
- Different Certificate and Diploma courses are also run by ICWAI to keep students more updated with the current business practices.
- Certificate in Accounting Technicians (CAT): A Program divided into two levels and comprises of computer training, practical training and orientation training. The certification program is of one year. Course mainly is aimed at developing required skills to apply the theoretical knowledge to practical situations.
- Certification in IFRS Convergence: A Program to equip CWA members with the knowledge of International Financial Reporting Standards.
- Diploma in Management Accountancy, a research based program only for the members of the ICWA.
CA and ICWA Courses-Comparison
- Both CA and ICWA as course disciplines, while dealing with the same business entities, deal with two different aspects of accounting in them–CA more with the external, statutory regulated accounting transactions and whereas CWA more with the internal costs and managerial accounting transactions. Thus both in principles and practices, there is more of a divergence than overlaps except in the essentials of accounting, business management, law and administrative aspects, where more overlap is observed.
- To their credit, both the institutes have carved out appropriate academic streams of high quality standards coupled with intense practice in respective Financial Accounting and Cost Accounting fields.
- Courses are set at high standards with rigorous testing and examinations.
- There are differing perceptions of toughness of the courses and their utility post qualification. Some argue that the CA is tougher in terms of quantum of academics and hardwork required to prepare than in the CWA. Yes, course content-wise, CA is more voluminous and elaborate. But CWA in terms of skills to be imparted in terms of Costing as related to Management Accounting is no less rigorous too. Both demand, in some different measures, structured, dedicated, focussed study and work from the students. Long hours of systematic independent preparation is the key to qualifying in both the courses, knowing that there are no formal classroom-prescribed coaching programs. In this hardly there is anything to choose between the two. It is noteworthy that both these professional courses have very low course costs, not more than Rs.50,000 to Rs.60,000 for the four to five years of the course duration astonishingly low as compared to a comparably rewarding engineering or medical courses that may cost beginning from a high Rs. 2 lakhs to anywhere upto Rs.10 lakhs per year. This should necessarily encourage more students to CA and CWA courses.
In terms of careers and employment both have wide range of opportunities in Company employment, Consultancy and Advisory as well as independent Practice based upon the rewards–short term and long term–expected, coupled with the risks one expects to take. Though the initial placement salaries for CA qualifiers are seen higher, ranging from Rs.6 lakhs to 80 lakhs (overseas placements being at the highest end), CWA qualifiers command initially lower, ranging from Rs. 4 lakhs to 40 lakhs (latter for overseas placements in Consultancy firms for the highest ranking). CWA qualifiers can command higher compensation packages after years of experience and practice.
Both CA and CWA seem to have no end to the demand for their employment even in economically depressed times as their services are essential for all business situations and for all time to come.