The Institute of Chartered Accountants of India Southern India Chartered Accountants Students Association (SICASA) Kottayam Branch HORIZON May 2024
May 2024 | Horizon Kottayam Branch of Southern India Chartered Accountants Students Association (SICASA) of The Institute of Chartered Accountants of India T A B L E O F C O N T E N T S Kottayam SIRC Chairman’s Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Kottayam SICASA Chairman’s Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Kottayam SICASA Vice Chairperson’s Note. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Editor’s Note . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Art Corner . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Amplifying Investment Opportunities. . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Rays of Hope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . Click of the month . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1 2 3 4 5 7 9 10 11 12 13 14 Photo Gallery . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Important Announcements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Compliance Calendar. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . Meet the committee . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Chairman’s Note Kottayam Branch of SICASA | May 2024 | HORIZON All the blessings are from the Almighty! Dear beloved students! Taking over as the 42nd Chairman of Kottayam Branch, SIRC is indeed a great honour. I can only hope to continue the great legacy put forward by the previous office bearers. Let me take this opportunity to congratulate all the newly elected committee members: CA Ramya N (Vice Chairperson), CA Sreejith N.C (Secretary and Treasurer), CA Sabu Thomas (SICASA Chairperson), and the managing committee members: CA Balaji K (Immediate Past Chairman), CA. Prem Sebastian Antony (Managing Committee member). I look forward to working with them to accomplish greater heights, expanding the creativity and other skills our beloved members and students are blessed with. March has been a hectic month. As I take over the very prestigious baton of change from my predecessor, CA Balaji K, at that time the branch was the 2nd best branch of SIRC, I, along with fellow Managing Committee members, take the oath to lead the Kottayam Branch of the August Institute to greater heights, envisioning development and overall growth for the members, students, and families at large. The installation ceremony of the new office bearers of the ICAI-Kottayam Branch was conducted on March 7, 2024. It was a dignified function, well attended by the well-wishers of both the outgoing and incoming chairpersons. The Hon’ble CA Thomas Chazhikadan, MP, inaugurated the function and stressed the challenges faced by professionals, especially when it comes to ethics and efficacy. CA. Shine P Joseph Chairman Kottayam branch of SIRC of ICAI
Chairman’s Note Kottayam Branch of SICASA | May 2024 | HORIZON We also conducted the Disha Kottayam 2024 Higher Studies Expo. On Wednesday, March 27, the Department of Public Education, Higher Secondary Wing, Career Guidance, and Adolescent Counselling Cell, Kottayam District, organised ‘Disha Kottayam 2024: Higher Studies Expo’ at Kalaketti Achamma Memorial Higher Secondary School, Assisi Andha Vidyalaya, and Holy Cross Church Auditorium.4500 higher secondary students and their parents studying in higher secondary schools in the Kottayam district participated in the programme, ranging from those aiming for admission in India’s premier educational institutions to those aiming for immediate employment after studying short-term courses. ICAI Kottayam Branch co-sponsored the event, and this programme has made it possible to introduce the CA course to more children. CA Annu, John, and CA Arvind C. Thomas took the session for the students. ICAI Kottayam Branch Chairman, CA Shine, P. Joseph, and CA Satheesan P, Tresurerm SIRC of ICAI, CA Rajesh S, Member, SIRC of ICAI, CA Vijayalakshmi, CA Balaji K., and CA Sabu Thomas spoke about the further potential of Chartered Accountancy. The programme was of good quality in every way and enough to attract more children to opt for the CA course. TVs were placed in classrooms for children to attend online classes, which was a great initiative. Let me conclude with this inspiring quote of Paulo Coelho “Whenever you want to achieve something, keep your eyes open, concentrate and make sure you know exactly what it is you want. No one can hit their target with their eyes closed.” Jai Hind! Jai ICAI! CA Shine P. Joseph
Chairman’s Note Kottayam Branch of SICASA | May 2024 | Horizon Dear Esteemed CA Students, As we prepare ourselves for the upcoming CA examinations, I extend my warmest greetings and best wishes to each one of you. This period demands our utmost dedication, perseverance, and focus, and I have full confidence in your ability to rise to the occasion and excel. The journey towards becoming a Chartered Accountant is not merely about passing exams; it is a testament to our dedication, discipline, and unwavering commitment to the highest standards of professionalism. As you immerse yourselves in your studies, remember that every hour of hard work brings you closer to your goals. Amidst the rigorous preparation for the exams, I urge you to also recognize the significance of your role as responsible citizens of our nation. The forthcoming Indian Parliament elections present us with a crucial opportunity to exercise our democratic right to vote and shape the future of our country. Voting is not just a privilege; it is a responsibility that each one of us must embrace wholeheartedly. Our votes have the power to influence policies, drive change, and shape the destiny of our nation for generations to come. By casting our vote, we contribute to the collective voice of our society and uphold the principles of democracy. As future leaders and professionals, it is imperative that we actively engage in the democratic process and make informed decisions that reflect our values and aspirations. Let us seize this opportunity to participate in the electoral process and make our voices heard. CA. Sabu Thomas Chairman SICASA Kottayam
Chairman’s Note Kottayam Branch of SICASA | May 2024 | Horizon In conclusion, as you navigate through the challenges of exam preparation and engage in the democratic process, I urge you to remain steadfast in your determination, uphold the highest ethical standards, and stay committed to your goals. Together, let us strive for excellence in both our professional endeavors and our civic duties. Wishing you all the very best for the upcoming CA exams and may you continue to be beacons of inspiration and change in our society. Warm regards, CA Sabu Thomas
Vice Chairman’s Note Kottayam Branch of SICASA | May 2023 | Horizon “ Success can come to you by courageous devotion to the task lying in front of you ~ C V Raman Warm Greeting to you all, At the outset I would like to convey my best wishes to all friends appearing for May 2024 examination. It gives me immense pleasure to communicate with you as the new vice chairperson of SICASA Kottayam. It is an honor to serve alongside such dedicated and talented individuals. We are all geared up to contribute to building upon the successes of the past and I am confident that we will be able to fulfil our vision. April has been a month of significant milestones, and engaging activities for our branch. We kicked off the month with the installation ceremony of the new committee members on April 3, 2024. It was a momentous occasion. Further, I am thrilled to announce the inauguration of our new SICASA office, a space where ideas will flourish, and collaborations will thrive. This marks a new chapter in our journey, and I am excited about the opportunities it will bring for our members. I encourage each of you to actively participate in our upcoming events and initiatives. Your involvement is integral to the success and vibrancy of our SICASA. Let us work together to make this upcoming year a resounding success. Best wishes to all appearing for the May 2024 examination. Regards, Keerthi A Nair Keerthi A Nair Vice Chairman SICASA Kottayam
Editor’s Note Kottayam Branch of SICASA | May 2024 | Illuminare “ Know what sparks the light in you so that you, in your own way can illuminate the world. - Oprah Winfrey Dear Readers, Having served as the editorial committee member last year and now returning to the role as editorial co-ordinator, I’m honoured to welcome our readers once more. I’m thrilled to unveil the new name for our magazine that is “HORIZON.” Questions may arise in your mind “Why Horizon?” Just a simple answer, as the horizon symbolizes the boundary where the sky meets the earth, here it is marking a border of endless possibilities and exploration. As Oprah Winfrey says “Know what sparks the light in you so that you, in your own way can illuminate the world.” The quote emphasizes the importance of embracing our unique strengths and interests to shine brightly and inspire others. The true power of our inner light lies not in its intensity, but in its ability to illuminate the world around us. For some their inner light or strengths may be found in creative expression – in the strokes of a paintbrush, crafting of a story, unveiling life’s beauty through the lens and weaving verses through words. Each person’s voice matters. Contribute your thoughts that reflect your inner light and unique strengths, let your creativity shine in our newsletter. Precisely in each moment of our lives the horizon becomes a beacon of hope. It reminds us that beyond every trial lies the potential for triumph, beyond every setback lies the opportunity of growth. I extend my sincere gratitude to our contributors who have generously shared their knowledge and experiences. With your continued support I am confident that Horizon will remain a guiding light of enlightenment within the realm of publishing each month. Beyond the horizon there awaits a future ripe with possibility and promise. Thanking You and Happy Reading! Sincerely, Jelita Elizabeth Mathew Jelita Elizabeth Mathew Editor Kottayam SICASA
May 2024 | Horizon Kottayam Branch of Southern India Chartered Accountants Students Association (SICASA) of The Institute of Chartered Accountants of India Art Corner By:- Shreya Kudva SRO0758185
May 2024 | HORIZON Kottayam Branch of Southern India Chartered Accountants Students Association (SICASA) of The Institute of Chartered Accountants of India AMPLIFYING INVESTMENT OPPORTUNITIES INTRODUCTION Derivatives are financial contracts whose value is dependent on an underlying asset and the very common assets could be Stocks, Bonds, Currencies, Commodities, and Market Indices. The value of derivatives is directly or indirectly influenced by the price of the underlying asset. Derivatives are usually traded by predicting the underlying asset’s future price movement. The value of the underlying asset is bound to fluctuate in accordance with the highly volatile market conditions prevalent and the core to be grasped when it comes to derivative trading is to appropriately determine the profits or likeliness with speculation. WHAT IS AN UNDERLYING ASSET? An underlying asset is defined as the asset on which the financial instruments such as derivatives are based. These assets give derivatives their value. The underlying assets can be stocks, market indices, currencies, commodities, etc. For example, an option on stock ‘X’ gives the holder the right to buy or sell ‘X’ at the strike price up until expiration. The underlying asset for the option is the stock of ‘X’. TYPES OF UNDERLYING ASSETS: There are different types, or classes, of underlying assets, and they come with unique characteristics that, in turn, affect the nature and structure of the derivatives associated with each type of underlying asset. 1. Stocks 2. Bonds 3. Commodities 4. Currencies 5. Interest Rates 6. Market Indices Underlying Assets are basic building blocks for derivatives contracts. It could be highly speculative in nature and trading against those assets require a comprehensive knowledge of trading, leverage, hedging, and speculation. Derivative trading requires a skill-set and strategies that are different from normal equity trading. Derivatives derive their value from the underlying assets through a specified contract or agreement. The price or performance of a derivative is influenced by the changes in the value of the underlying asset. For instance, with an options contract, you have the choice to buy or sell the asset at a set price within a specific time.
May 2024 | HORIZON Kottayam Branch of Southern India Chartered Accountants Students Association (SICASA) of The Institute of Chartered Accountants of India Similarly, if you purchase a futures contract on a commodity like oil, the underlying asset is the physical oil itself. The price of a futures contract is affected by oil market changes. When oil prices go up, the contract's value also increases, and vice versa. TYPES OF DERIVATIVE CONTRACTS Derivative contracts are of different varieties which cater to different needs and returns that the investor aims from the said investment and also varies accordingly with the risk appetite an investor capacitates. The most popular contracts under derivatives are listed under: 1. FUTURES: • These types of contracts involve counterparties- The Buyer and the Seller- who agree to exchange an underlying asset after an agreed time and expiry date. • These contracts are traded on Market Exchange and which guarantees that the terms are standardized. • The key participants in to initiate and carry on with these types of contracts would be Hedgers who are aiming at cashing in on profits and to protect against the downside of potential adversities along the assets that possess and are pen to substantial exposure in the market and the Speculators who are eyeing to profit meticulously from high-risk and value fluctuations in the volatile conditions. 2. OPTIONS: • Options contract offer the buyer the right and not the obligation to buy or sell the underlying asset at a pre-determined price during a certain period of time or at a specific date. • They differ from other stock like securities as they do not represent ownership in a concern/company. • There is always the flexibility to withdraw from the contract at any given time. Two components of options contract is the put option and call option. • A put option gives buyer the right to sell any underlying asset at a strike price and a call option gives a buyer the right to buy at a strike price at anytime up-to the expiration date. • One of the reasons why investing in the options is found lucrative by the investors could be that they have smaller premiums. 3. FORWARDS: • A forwards contract is the most easiest as well a most sought after contracts by investors within the derivatives communities and the reason for this could be there is no transaction cost involved, and no restrictions on short sales is located. • Here, Short sale refers to the act of selling an asset or commodity in the forward market with the intention of buying it back at a later date.
May 2024 | HORIZON Kottayam Branch of Southern India Chartered Accountants Students Association (SICASA) of The Institute of Chartered Accountants of India • Further, all the borrowing and lending are agreed to be carried out at risk-free rates. • The biggest difference spotted between forward and futures contract would be that unlike in future contract where a buyer or seller initiates reverse transaction to their original transaction to close a position, for a forward contact to be liquidated, it can result in two ways which could be either cash or physical delivery. 4. SWAPS: • A swap is a derivative contract through which two parties exchange the cash flows or liabilities from two different financial instruments. • The financial experts firmly affirm that the origination of the swap markets can be traced back to 1970s when many countries imposed exchange regulation and restrictions in order to control cross border capital flows. • There are various types of swaps, namely Interest Rate Swap, Currency Swap, Commodity Swap Equity Swap, Zero Coupon Swap, Credit Default Swap, Total Return Swap and many more. • Swaps give corporations to shift the performance of their assets rapidly and cheaply without actually exchanging ownership of those assets and thus become extremely popular as a method of managing risk and generating revenues. WHAT IS DERIVATIVES TRADING? In the risky and unpredictable investment industry, options trading can be a game changer. They allow investors a little breathing room when buying stocks or bonds. You pay a lower price for the choice to buy assets at a specified date after analysing the stock market performance. Options, also called derivatives, are used to create a tradable contract between two or more parties. It’s a different transaction from buying stocks. The latter requires you to pay for outright ownership of the asset. Derivatives allow you the option to buy at a later date. Investment professionals who understand the intricacies of the markets are able to master the art of options trading. They know how to hedge their bets. They can keep one ear on the ground and one eye on the stock performance to arrive at a suitable prediction. To determine whether the price will rise or fall before the due date. ROLE OF FINANCIAL DERIVATIVES IN THE MARKET Financial derivatives play a crucial role in the financial markets by serving several important functions: 1. Hedging: Derivatives are primarily used for hedging, which involves protecting against losses due to adverse price movements. For example, a farmer might use futures contracts to lock in a selling price for their crops, protecting them against a decline in crop prices.
May 2024 | HORIZON Kottayam Branch of Southern India Chartered Accountants Students Association (SICASA) of The Institute of Chartered Accountants of India 2. Speculation: Derivatives also facilitate speculation, which involves taking a position on the future direction of an asset's price. Speculators aim to profit from price movements by buying or selling derivatives contracts. 3. Risk Management: Derivatives can be used to manage various risks, such as interest rate risk, exchange rate risk, and credit risk. They allow businesses and investors to transfer or offset these risks to other parties. 4. Price Discovery: Derivatives contribute to price discovery by providing information about market expectations for the future price of an underlying asset. This information can be used by investors to make informed trading decisions. 5. Market Efficiency: Derivatives enhance market efficiency by allowing for more efficient allocation of capital and risk across different market participants. CONCLUSION Derivatives can be a very convenient way to achieve financial goals. For example, a company could hedge its currency risk by purchasing currency forward contracts. Derivatives can also help investors leverage their positions, such as by buying equities through stock options rather than shares. The main drawbacks of derivatives include counterparty risk, the inherent risks of leverage, and the fact that complicated webs of derivative contracts can lead to systemic risks. Derivatives play a crucial role in financial markets, allowing investors to manage risk, speculate on price movements, and hedge against adverse changes. In summary, derivatives serve as indispensable tools in modern finance, offering investors opportunities to manage risk, speculate on price movements, and enhance portfolio performance. However, their complexity demands caution, as demonstrated by historical market upheavals. Continued education, prudent regulation, and responsible usage are imperative to harness the benefits of derivatives while mitigating systemic risks, ensuring a resilient and efficient financial ecosystem for all stakeholders. To conclude, Derivatives are truly redefining the future of Finance. By:- Apeksha Kamath SRO0757783
May 2024 | Horizon Kottayam Branch of Southern India Chartered Accountants Students Association (SICASA) of The Institute of Chartered Accountants of India Art Corner By:- Keerthi A Nair SRO598914
May 2024 | HORIZON Kottayam Branch of Southern India Chartered Accountants Students Association (SICASA) of The Institute of Chartered Accountants of India RAYS OF HOPE By:- Jelita Elizabeth Mathew SRO0787102
May 2024 | Horizon Kottayam Branch of Southern India Chartered Accountants Students Association (SICASA) of The Institute of Chartered Accountants of India Clicks By:- Vishnu V Hedgen SRO0765321
Installation Ceremony & Inauguration of SICASA Office
Seminar on Strategies to ace CA exams by CA Jomon K George
Inter branch indoor games tournament � Badminton Women's Doubles Runners Up -> Keerthi A Nair & Serin Elsa Koshy � Badminton Men's Doubles Runners Up -> Febi M Chacko & Joseph Janice � Badminton Women's Singles Runner Up -> Joseph Janice Keep it up Congrats
1 Important Announcements Date of Announcement Details 1 09-04-2024 With a view to develop the Question Bank for Set-C (comprising 10 subjects) and Set-D ( comprising 4 subjects) , it has been decided to invite questions from Chartered Accountants/experts working in various organizations/institutions/ universities. 2 24-04-2024 The Institute has decided that from May/June 2024 onwards, Intermediate & Foundation course Examinations will be held thrice in a year in the month of May/June, September and January from the existing practice of twice a year and CA Final course examination will continue to be held twice a year in the month of May and November. Students may note that as per the above eligibility criteria – the last date for registration in Foundation Course for appearing in September 2024 Examination is 1st May 2024. the last date for registration in Intermediate Course for appearing in January 2025 Examination is 1st May 2024 through both the routes. It may be noted that students who have registered in Intermediate Course either through Foundation Route or Direct Entry Route up to 1st January 2024 are eligible for appearing in September 2024 Intermediate Examination. 3 25-04-2024 Commencement of Live Virtual Classes (LVC Batch - 2) under the New Scheme from 27th April 2024 for the students of CA Foundation/Intermediate/Final courses appearing in September/November 2024 Examinations 4 07-05-2024 Self-Paced Online Modules (SPOM) SET A and SET B: Students are required to complete the minimum prescribed 40 learning hours of SelfPaced Online Modules in both SET A: Corporate and Economic Laws and SET B: Strategic Cost & Performance Management as available on the ICAI Digital Learning Campus https://lms.icai.org/login.
Horizon ~ May 2024 Kottayam Branch of Southern India Chartered Accountants Students Association (SICASA) of The Institute of Chartered Accountants of India Compliance Calendar May 2024 7 TDS Payment for April 2024 10 Professional Tax (PT) on Salaries for April 2024 11 GSTR 1 (Monthly) for April 2024 13 GSTR 1 IFF (Optional) (Apr 2024) for QRMP 15 TCS Return in Form 27EQ for Jan-Mar 2024 Quarter 15 Provident Fund (PF) & ESI Returns Payment for April 2024 15 Filing of LLP BEN-2 and Form No. 4D 20 GSTR 3B for April 2024 (Monthly) 25 GST Challan Payment if no sufficient ITC for Apr 2024 (for all Quarterly Filers) 30 Form 11 for FY 2023-24 for LLP's 30 TDS Payment in Form 26QB (Property), 26QC (Rent), 26QD (Contractor Payments), 26QE (Crypto Assets) for Apr 2024 30 Issue of TCS Certificates in Form 27D for Jan to March 2024 31 TDS Return in Form 24Q, 26Q, and 27Q for Jan-Mar 2024 31 Due date for furnishing of statement u/s 285BA For FY 2023-24 (For Banks etc.)