30+ Article Assistant Interview Questions and Answers for Freshers

Emphasis on matter paragraph highlights significant matters in financial statements while key audit matter focuses on significant audit matters.

• Emphasis on matter paragraph is included in the auditor's report while key audit matter is a separate section.

• Emphasis on matter paragraph highlights significant matters in the financial statements such as going concern, related party transactions, and significant accounting policies.

• Key audit matter focuses on significant audit matte...read more

Current maturities of long term obligations are typically placed under current liabilities on a balance sheet.

• Current maturities of long term obligations represent the portion of long term debt that is due within the next year.

• They are classified as current liabilities because they are expected to be paid off within a year.

• Examples include the current portion of a long term loan or mortgage.

• They are important for assessing a company's short term financial obligations.

GST can lead to cheaper goods through the elimination of cascading taxes and increased efficiency in the supply chain.

• GST eliminates the cascading effect of taxes, where taxes are levied on top of taxes, resulting in higher prices.

• Under GST, input tax credits can be claimed, allowing businesses to reduce their tax liability and pass on the benefits to consumers.

• GST simplifies the tax structure and reduces compliance costs, which can lead to cost savings for businesses and ult...read more

Contingent assets and liabilities are potential future events that may or may not occur.

• Contingent assets are potential assets that may arise from past events, but their existence is uncertain and depends on future events.

• Contingent liabilities are potential obligations that may arise from past events, but their existence is uncertain and depends on future events.

• Contingent assets and liabilities are disclosed in the financial statements as footnotes.

• Examples of contingent as...read more

Section 194Q of income tax act requires deduction of tax at source on purchase of goods above Rs. 50 lakhs.

• Introduced in Budget 2021, applicable from 1st July 2021

• Applies to buyers whose turnover exceeds Rs. 10 crores

• Tax to be deducted at 0.1% on purchase value exceeding Rs. 50 lakhs

• Seller can claim credit for TDS deducted under Section 194Q

Trial balance needs to match to ensure accuracy of financial statements.

• Trial balance is a statement of all ledger balances.

• It ensures that total debits equal total credits.

• If there is a discrepancy, it indicates an error in the accounting records.

• Matching trial balance is important for accurate financial reporting.

• Errors can be identified and corrected before finalizing financial statements.

Capital gains are calculated by subtracting the cost of acquisition from the sale price of an asset.

• Determine the sale price of the asset

• Determine the cost of acquisition of the asset

• Subtract the cost of acquisition from the sale price to get the capital gain

• Apply any applicable exemptions or deductions to arrive at the taxable capital gain

Advise clients on the benefits and considerations of voluntarily paying advance tax to manage their tax liabilities effectively.

• Understand the client's income sources to estimate tax liability accurately.

• Consider the benefits of avoiding interest and penalties by paying advance tax.

• Example: If a client expects a significant capital gain, they should pay advance tax to avoid a hefty tax bill later.

• Advise on the timing of payments to align with income realization, ensuring they...read more

Provision is a liability that is uncertain in timing or amount, while reserve is a portion of profits set aside for a specific purpose.

• Provision is an estimated expense that a company sets aside in its accounts to cover a potential future liability.

• Reserve is a portion of profits that a company sets aside for a specific purpose, such as to fund future expansion or to pay dividends.

• Provision is recognized as an expense on the income statement, while reserve is shown as a separ...read more

Sampling is the process of selecting a subset of individuals from a larger population to represent the whole.

• Sampling involves selecting a smaller group from a larger population for research or analysis.

• Types of sampling include random sampling, stratified sampling, cluster sampling, and convenience sampling.

• Random sampling involves each member of the population having an equal chance of being selected.

• Stratified sampling involves dividing the population into subgroups and th...read more

Tax Deducted at Source (TDS) under section 194 CIJ

• Section 194 CIJ of the Income Tax Act deals with TDS on payment of compensation on acquisition of certain immovable property.

• TDS is deducted at the rate of 10% on the amount of compensation paid.

• The person responsible for making the payment is required to deduct TDS and deposit it with the government.

• The TDS deducted needs to be reported and filed in the TDS return.

• Failure to deduct or deposit TDS may attract penalties and int...read more

Related party transactions as per AS18 are transactions between a reporting entity and its related parties.

• Related party transactions include transactions between a company and its subsidiaries, associates, key management personnel, and their close family members.

• AS18 requires disclosure of related party transactions in the financial statements to ensure transparency and prevent conflicts of interest.

• Examples of related party transactions include sales or purchases of goods o...read more

Direct taxes are paid directly by individuals or organizations to the government, while indirect taxes are collected by intermediaries and passed on to the government.

• Direct taxes are levied on individuals and organizations based on their income or profits, such as income tax and corporate tax.

• Indirect taxes are imposed on goods and services, and are ultimately paid by the end consumer, such as sales tax and value-added tax (VAT).

• Direct taxes are progressive in nature, meanin...read more

I am expecting a stipend in line with industry standards and commensurate with my skills and qualifications.

• Research industry standards for Article Assistant stipends

• Consider my skills and qualifications when determining expected stipend

• Be prepared to negotiate based on job responsibilities and workload

I scored 65% in CA Intermediate exams.

• Scored 65% in CA Intermediate exams

• Secured a good percentage in the exams

• Performed well in the CA Intermediate exams

Section 194Q deals with TDS on purchase of goods, while 194C deals with TDS on payment to contractors.

• Section 194Q of TDS applies to TDS on purchase of goods exceeding Rs. 50 lakhs in a financial year.

• Section 194C of TDS applies to TDS on payment to contractors for work exceeding Rs. 30,000 in a single payment or Rs. 1,00,000 in aggregate in a financial year.

• Both sections require deduction of TDS at specified rates and timely deposit with the government.

AS-22 is an accounting standard that deals with accounting for taxes on income.

• AS-22 is issued by the Institute of Chartered Accountants of India (ICAI).

• It provides guidelines on how to account for current and deferred tax.

• Current tax is the amount of income tax payable based on taxable profit for the year.

• Deferred tax is the tax effect of timing differences between accounting profit and taxable profit.

• AS-22 requires companies to recognize deferred tax assets and liabilities....read more

Statutory audit is mandatory by law, while internal audit is voluntary and conducted by the company itself.

• Statutory audit is conducted to ensure compliance with legal and regulatory requirements.

• Internal audit is conducted to evaluate the effectiveness of internal controls and identify areas for improvement.

• Statutory audit is conducted by an independent external auditor, while internal audit is conducted by employees of the company.

• Examples of statutory audits include audits...read more

Direct tax is levied on individuals and businesses directly by the government, while indirect tax is passed on to consumers through goods and services.

• Direct tax is paid directly by the taxpayer to the government, such as income tax and corporate tax.

• Indirect tax is collected by an intermediary (like a retailer) from the consumer and then passed on to the government, such as sales tax and GST.

• Direct tax is progressive in nature, meaning the more you earn, the higher percentag...read more

Three different Standards on Auditing are ISA, PCAOB, and AS

• ISA - International Standards on Auditing, issued by the International Auditing and Assurance Standards Board (IAASB)

• PCAOB - Public Company Accounting Oversight Board standards for audits of public companies in the United States

• AS - Auditing Standards issued by the Institute of Chartered Accountants of India (ICAI)

Order of GST set off determines the sequence in which input tax credit can be utilized against output tax liability.

• Input tax credit from IGST can be used to set off IGST, then CGST, and finally SGST liability.

• Input tax credit from CGST can be used to set off CGST and then IGST liability.

• Input tax credit from SGST can be used to set off SGST and then IGST liability.

• Any remaining credit after set off against the same type of tax can be used for set off against other types of t...read more

Excel has various formulas for calculations and data manipulation.

• SUM: Adds up a range of cells

• AVERAGE: Calculates the average of a range of cells

• VLOOKUP: Searches for a value in the first column of a table and returns a value in the same row from another column

• IF: Performs a logical test and returns one value if the test is true and another if it's false

Valuation methodologies assess a company's worth using various approaches like DCF, comparables, and precedent transactions.

• Discounted Cash Flow (DCF): Projects future cash flows and discounts them to present value. Example: Valuing a tech startup based on projected revenues.

• Comparable Company Analysis: Compares the target company to similar firms in the industry. Example: Valuing a retail chain by looking at P/E ratios of competitors.

• Precedent Transactions: Analyzes past M&A...read more

Audit is a systematic examination of financial records, statements, or operations to ensure accuracy and compliance with laws and regulations.

• Audit involves reviewing financial records and transactions to ensure accuracy and compliance with laws and regulations.

• It helps in providing assurance to stakeholders about the reliability of financial information.

• Auditors use various techniques such as sampling, testing, and verification to gather evidence during the audit process.

• Typ...read more

Journal entries involving TDS and GST

• When recording journal entries with TDS, remember to account for the TDS amount deducted at the time of payment

• For GST, ensure to record both the input and output GST correctly in the journal entries

• Make sure to follow the applicable tax rates and rules for TDS and GST while recording the entries

Changes in budget refer to modifications made to the financial plan or allocation of funds.

• Changes in budget can include increases or decreases in funding for specific projects or departments.

• Budget changes may result from unexpected expenses, revenue fluctuations, or strategic shifts in priorities.

• Effective budget management involves monitoring changes and adjusting plans accordingly.

• Examples of budget changes could be reallocating funds from one project to another, cutting ...read more

A Draft Red Herring Prospectus (DRHP) outlines a company's intent to go public, detailing financials and business plans.

• Purpose: To provide potential investors with information about the company before an IPO.

• Contents: Includes financial statements, risk factors, and management details.

• Regulatory Requirement: Must be filed with the Securities and Exchange Board of India (SEBI) in India.

• Example: A tech startup may highlight its growth metrics and market potential in its DRHP.