My 2nd Article in Education Times - this time on CPT

SUBJECT SMART

WITH THE COMMON PROFICIENCY TEST (CPT) ONLY A FEW WEEKS AWAY, ASPIRING CHARTERED ACCOUNTANTS ACROSS THE COUNTRY ARE BUSY WITH FRANTIC PREPARATIONS. SATSHEEL REDKAR, ALL-INDIA TOPPER, CPT-2007, SHARES SUBJECT-WISE TIPS ON HOW TO ACE THE EXAM

Entering the final few weeks, the last lap, and the foremost lunge towards the CPT? You have prepared for months, all through your Class 12 exams and devoted a lot of time, effort and patience. But what can you do to give your preparations the perfect finishing touch? What does it take to ensure that your name features in that elite list of merit rankers?
The Common Proficiency Test, or the CPT as it is more popularly known, is the entry level ie lowest/first level at which a student can start pursuing the Chartered Accountancy course. Till a few months ago, one could begin their Articleship training right after clearing CPT, however the rules have changed and now one also needs to clear the Integrated Professional Competence Course (IPCC) after clearing CPT to begin the Articleship training. The revamped format should put less pressure on students, as now the fate of which firm they train with does not wholly rest upon the CPT scores.
Nonetheless, it is imperative to put in your best in CPT and to begin with, you need to first assess yourself and understand where you stand. Only once you realise how prepared you truly are, will you be able to move ahead in the right direction. The CPT is made up of four distinct subjects divided into two sessions.

SESSION – I
(Two Sections– Two hours – 100 Marks)

Section A: Fundamentals of Accounting (60 Marks)

Section B: Mercantile Laws (40 Marks)
SESSION – II
(Two Sections– Two hours – 100 Marks)

Section C: General Economics (50 Marks)

Section D: Quantitative Aptitude (50 Marks)

The current guidelines of the Institute of Chartered Accountants, India (ICAI), the statutory body that conducts and regulates the CPT, say, A candidate shall ordinarily be declared to have passed the test if he obtains a minimum of 50 per cent marks, subject to the principle of negative marking, in a manner as may be specified by the council from time to time. In its current format, the negative mark-ing is 25 percent or one-fourth of a grade.

‘SUBJECT’IVE SMARTNESS

1. Fundamentals of Accounting
The ICAI certainly lays more emphasis on this subject as is evident from the marks weightage. Since this is the base of your CA career, you are expected to be strong with the fundamentals. The basic concepts should be studied thoroughly and one should pay more attention to theory, as previous years have seen more weightage being given to theory questions. Manish Modi, a practising CA who teaches accountancy at Pinnacle Education advises, “Students must concentrate on mastering the theoretical questions that can be asked from various aspects of the syllabus.”
Since long questions cannot be asked for one mark, CPT usually has a. One long problem and four-five small
questions based thereupon b. Small questions for one mark each Hence one definitely cannot leave the lengthy questions while studying as that means risking four or five marks at one go.
Apart from the theory questions, areas that could be focussed upon include calculating depreciation via various methods, computing discount/ interest on bills, consignment and joint venture problems, goodwill, and others.

2. Mercantile Laws
Assuming the CPT to be the first time that many students study law, the syllabus covers basic and structural laws. Beginning with the Indian Contract Act, 1872 (Sections 1 to 75); the Sales of Goods Act, 1930 and the Partnership Act, 1932 are included herein. Keshav Thakkar, who secured the fourth rank in CPT-2008, explains, “There are three acts of which, The Contract Act is undoubtedly the most important and complex. Case studies/ illustrations for the provisions are a nice way of understanding the relevant laws. It is best to clear out all of one’s doubts and leave no ambiguity before the paper.”
Dhawal Vora, who had missed the All-India merit of the CPT (August 2007) by merely two marks adds, “Be clear with similar sounding concepts in order to avoid confusion during the exam. The ICAI is known to test you on such concepts.”

3. General Economics
General Economics is made up of two parts – Micro and Macro.
In Macro-economics, expect around four-five questions on statistics. Also, there have always been a few general knowledge questions in relation to economics. So, it would do a student well to start reading the newspapers. While seeming trivial, these marks prove useful in turning average/ good marks into a merit rank-deserving result. Vora, now a final year CA student, from his own experience shares, “It is essential to have a good grip on economics so that you can complete the 50 questions quickly. This will leave you with ample time for Quantitative Aptitude. Prepare yourself to wrap up economics in not more than 20 minutes.” He says he finished economics in only eight minutes but was still just barely able to finish Quantitative Aptitude.
Another important piece of advice from Mahesh Deshpande, General Economics teacher at Gurukul Academy, is, “Although you will not be asked to draw graphs, it is important to practise them to get the required conceptual clarity.”

4.Quantitative
Aptitude
On Quantitative Aptitude, Sudhir Kamath, who teaches Mathematics at Eskays Learner Academy, says, “One should focus on the basics first which have to be strong. Study the entire module which should generally guarantee you a score of 40+ in Quantitative Aptitude. During the exam, it would be better to attempt the economics paper first and to try and finish it within 40-45 minutes. The balance should be kept for Quantitative Aptitude.” He also says that as a strategy, ‘do not waste time on any one single question.’
While the module covers many things, it is just enough to perhaps score average marks. To do better than most, you will also have to put in more effort than is expected of most. Try reading from other sources on certain topics. This applies especially for statistics and particularly the last chapters.
Hrishikesh Samant, Rank 3, CPT (August 2007 ), has a few suggestions for students studying Quantitative Aptitude, “Write down all mathematics and statistics formulae in a book and do repetitive reading. Also get comfortable with using the calculator. It proves a boon in an exam alongwith learning the shortcuts. If you have the time, then practise from other books. Do not forget to time yourself in such a manner that while solving, one problem does not take more than a minute and a half or two at the maximum. This will help you conserve time for the tough questions.”
When one sees the CPT as a whole, one comes across four subjects at a time. Here is where management tactics come into play. So how does one balance time amongst the four subjects?
Again, Samant offers some very important tips.

a. In economics, undertake rapid reading (as many number of times as possible) so that you can make out the correct statistics out of the four options that are given in the MCQs.

b. For accounts, focus on Schedule VI disclosures and scan through Basic Accounting Standards (Chapters 1, 2, 6, 9, and 10) apart from Basic Accounting Conventions and Assumptions.

c. When looking at Quantitative Aptitude, preferably revise only formulae and try solving papers.

d. Review all the important provisions and check if you can recollect its content and a related case/ example when revising law.
In addition to the above Thakkar advises to solve the model question papers provided by ICAI to gain sufficient practice. He says, “Law and statistics are the subjects to focus on in case you want to cross 160. Statistics carry a very high weightage in the 50 marks paper.”

Some general suggestions to keep in mind:

1. Since it is a multiple choice questions-based exam, one need not mug up everything. A general idea on most things will help in answering correctly as after seeing the options it becomes relatively conveni ent to recall the right answer.

2. If the ICAI persists with the 25 percent negative score, the probability is that of every four questions that you answer, one might be correct. Thus, the equation becomes +1 - 0.25*3 = +0.25. On the other hand, if you don’t answer any of the four questions, you straight away lose those four marks. But then, do your own math and this certainly does not mean that you fake anything!
3. If you have started studying only now, start with the basics of accounts and economics and become thorough with it. Study micro-economics first and then head over to macro. In Quantitative Aptitude, practice the statistics part well in addition to probability and permuta tions and combinations. Studying the initial parts of The Partnership and The Contract Act would do you well too.
4. As Thakkar says, “The study material is the primary basis on which the papers are set. Studying from other books should be in addition to and not instead of it”.
5. And finally, get off the internet and concentrate hard on your studies. This one month of hard work will ensure better returns later in your life. Good luck, follow the given tips, and do well!