JAIIB Paper 3 Module B Quiz 1

Accounting policy changes required by a new standard must follow that standard’s transition provisions and disclosure requirements. The impact may require retrospective or prospective treatment depending on the rule.

Payments to employees are generally operating cash outflows. Share issues are financing inflows; purchases of long-term assets and investment disposals are investing activities.

Pending and failed transactions may lead to incorrect balances, unsettled payments and reconciliation breaks. Monitoring and timely resolution protect customers and financial reporting.

Effective information security combines access controls, monitoring, secure configuration, incident response, user awareness and governance. No single technology guarantees complete security.

The balance sheet is a snapshot at the reporting date; the profit and loss account summarises income and expenses over the reporting period.

The classification of interest and dividends can depend on the applicable standard and entity type; consistency and the standard’s requirements are important. Do not assume a universal classification without checking the applicable framework.

New borrowing raises financing and creates a liability, so the proceeds are generally a financing cash inflow.

Basel-related disclosures support market discipline by providing information on regulatory capital, risk exposures and prudential measures. They do not replace financial statements or disclose confidential credentials.

The balance sheet equation is Assets = Liabilities + Equity. Therefore, Equity = Assets − Liabilities = ₹12 lakh − ₹4.5 lakh = ₹7.5 lakh.

Cash received before the service is delivered generally creates an obligation to perform or refund. Revenue is recognised when the applicable performance obligation is satisfied.

A company generally has a separate legal personality from its members. Its rights, obligations and assets are distinct from those of shareholders, subject to law.

Authorised capital is the maximum amount permitted to be issued under the company’s constitutional documents and applicable law. The other terms describe shares issued, taken up, called or paid.

Cash receipts from sales of goods and services are generally operating cash flows because they arise from the entity’s principal revenue-producing activities.

Change in working capital = increase in current assets − increase in current liabilities = ₹80,000 − ₹30,000 = ₹50,000 increase.

Contingent liabilities, including relevant guarantees and other obligations, are disclosed according to applicable accounting and regulatory requirements. Recognition depends on the applicable standards and whether a present obligation/provision criteria are met.

Computerised systems can improve speed, consistency, reporting and audit trails. They still require controls because configuration errors, cyber incidents and incorrect input can affect records.

CBS typically integrates customer information, account management, transaction processing, payments, deposits, loans and accounting interfaces. Exact modules depend on the solution.

Liabilities = Assets − Equity = ₹9,00,000 − ₹5,50,000 = ₹3,50,000.

Borrowings are obligations of the bank and are liabilities. Loans and advances, cash balances and investments are generally assets.

Paid-up capital = 10,000 × ₹8 = ₹80,000, assuming the full called amount has been paid and no other adjustments apply.