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JAIIB AFM Syllabus 2024

JAIIB AFM Syllabus: The Indian Institute of Banking and Finance or IIBF conducts the JAIIB exam twice a year. The Junior Associate for the Indian Institute of Banking or JAIIB exam is the first promotional exam for banking professionals. Accounting and Financial Management is the third paper of four for the exam. This article will provide a detailed JAIIB AFM syllabus.

JAIIB AFM Syllabus – Exam Pattern

Before we get into the syllabus, let’s take a look at the question and mark distribution for AFM.

SubjectsNo. of QuestionsTotal MarksDuration
Accounting and Financial Management1001002 hours

As you can see, the paper consists of 100 questions for a total of 100 marks. The paper is of a 2-hour duration. There is no negative marking and candidates require a minimum of 50 marks out of 100 to clear the paper.

JAIIB Accounting and Financial Management Syllabus

Paper 3 of JAIIB is Accounting and Financial Management. The paper consists of a total of 4 modules as listed below:

  • Accounting Principles and Processes 
  • Financial Statement and Core Banking Systems
  • Financial Management 
  • Taxation and Fundamentals of Costing.

AFM Module A Syllabus – Accounting Principles and Processes

The syllabus for Module A of AFM is below:

Definition, Scope and Accounting Standards including Ind ASNature and Purpose of Accounting, Historical Perspectives, New Accounting system / Value system accounting, Origins of Accounting Principles, Accounting Standards in India and its Definition and Scope, Generally Accepted Accounting Principles of USA (US GAAP), Overview of IFRSs, Difference between GAAP and IFRS Transfer Pricing.
Basic Accountancy ProceduresConcepts of Accountancy, Going Concern Entity, Double Entry System, Principle of Conservatism, Revenue Recognition and Realisation, Accrual and Cash Basis
Maintenance of Cash/Subsidiary Books and LedgerRecord Keeping Basics, Account Categories, Debit and Credit Concepts, Accounting and Columnar Accounting Mechanics, and Journalising
Bank Reconciliation StatementRecording Transactions in Cash Book, Transactions Contained in the Pass Book/Bank Statement, Is Passbook a Mirror Image of Cash Book? Causes for Passbook and Cashbook being different, Understanding Reconciliation, Preparing Reconciliation Statement, Need for Bank Reconciliation, How to prepare a Bank Reconciliation Statement when extracts of Cash Book and Pass Book are given? Adjusting the Cash Book balance, and Advantages of Bank Reconciliation Statement
Trial Balance, Rectification of Errors and Adjusting & Closing EntriesMeaning of a Trial Balance, Features and Purpose of a Trial Balance, Types of Trial Balance and Preparation of a Trial Balance, Disagreement of a Trial Balance, Classification of Errors, Location of Errors, Rectification of Errors, Suspense Account and Rectification, Rectification of Errors when Books are Closed, Adjusting and Closing Entries.
Depreciation & its AccountingMeaning of Depreciation, Causes of Depreciation, Need for Depreciation, Factors of Depreciation, Accounting Entries, Methods of Depreciation, Straight Line Method, Diminishing Balance or Written Down Value (WDV) Method, Advantages and Disadvantages of Straight Line Method, Advantages and Disadvantages of Written Down Value Method, Units of Production Method, Sum of the Years’ Digits Method, Replacement of a Fixed Asset and Creation of Sinking Fund, and Amortisation of intangible assets
Capital and Revenue ExpenditureExpenditure, Distinction between Capital and Revenue Expenditure Receipts
Bills of ExchangeTypes of Instruments of Credit, Term and Due Date of a Bill, Certain Important Terms, Accounting Entries to be Passed, Accommodation Bill, and Bill Books
Operational Aspects of Accounting EntriesPeculiar Features of Accounting System in Banks Accounting Systems of Different BanksIllustration
Back Office Functions/Handling Unreconciled Entries in BanksFunctions Performed by the Back Office, Reconciliation Function in Banks, Reconciliation of Inter Branch/ Office Entries.
Bank Audit & InspectionBank Audit Emergence of Risk based Internal Audit, Types of Bank Audits Viz. Concurrent Audit Internal Audit, Statutory Audit, Role of Audit and Inspection

AFM Module B Syllabus – Financial Statement and Core Banking Systems

The syllabus for Module B of AFM is below:

Balance Sheet EquationBalance Sheet Equation, Computation of Balance Sheet Equation
Preparation of Final AccountsPreparation of Trial Balance, Adjustment Entries, Preparation of Financial Statements from Trial Balance
Company Accounts – IDefinition and Types of Companies, Distinction between Partnership and Limited Liability Company, Classes of Share Capital, Issue of Shares, General Illustrations, Non-voting Shares
Company Accounts – IIForm of Balance Sheet, Impact of Ind AS on Financial Statements
Cash Flow & Funds FlowCash Flow, Funds Flow Statement, Cash Flow Statement, Fund Flow and Cash Flow Analysis
Final Accounts of Banking CompaniesDefinition and Functions of a Bank, Requirements of Banking Companies as to Accounts and Audit, Significant Features of Accounting Systems of Banks, Principal Books of Account, Preparation and Presentation of Financial Statements of Banks, Accounting Treatment of Specific Items, Preparation of Profit and Loss Account, Comments on Profit and Loss Account Items, Important Items of Balance Sheet. Disclosure Requirements of Banks to be Added as Notes to Accounts, Disclosures Prescribed by RBI Under Basel-III, Banks Listed on a Stock Exchange, Implementation of Indian Accounting Standards (Ind AS)
Core Banking Systems & Accounting in Computerised EnvironmentMeaning of Computerised Accounting, Features of Computerised Accounting, Terms Used in Computerised Accounting, Difference between Computerised and Manual Accounting, Advantages and Disadvantages of Computerised Accounting, Functions Performed by Computerised Accounting Softwares Available in the Market, Computerisation – Scope and Experiences in Banking, The Core Banking Components, Information Security, Internet and World Wide Web – Influences on Banking

AFM Module C Syllabus – Financial Management

The syllabus for Module C of AFM is below:

An Overview of Financial ManagementForms of Business Organisation, Financial Decision making in a Firm, Objectives of Financial Management, The Fundamental Principles of Finance, Building Blocks of Modern Finance,Risk-Return Trade off, Agency Problem in Financial Management, Business Ethics & Social Responsibility, Organisation of the Finance Function, Relationship of Finance to Economics and Accounting, Emerging Role of the Financial Manager in India
Ratio AnalysisMeaning of Accounting Ratios, Classification of Ratios, Uses of Accounting Ratios, Limitations of Accounting Ratios, Calculation and Interpretation of Various Ratios, Different Users and Their Use of Ratios 
Financial Mathematics – Calculation of Interest & AnnuitiesWhat is Simple Interest? What is Compound Interest? Fixed and Floating Interest Rates, Front-end and Back-end Interest Rates, Calculation of Interest Using Products/Balances,What are Annuities? Calculating the Future Value of an Ordinary Annuity, Calculating the Present Value of an Ordinary Annuity, Calculating the Future Value of an Annuity Due, Calculating the Present Value of an Annuity Due, Repayment of a Debt 
Financial Mathematics – Calculation of YTMMeaning of Debt, Introduction to Bonds, Terms Associated with Bonds, Types of Bonds,Optionality in Bonds, Valuation of Bonds, Bond Value with Semi-annual Interest, Current Yieldon Bond, Yield-to-Maturity of Bond, Theorems for Bond Value, Illustrations, Duration of Bond,Properties of Duration, Bond Price Volatility, Problems and Solutions 
Financial Mathematics – Forex ArithmeticFundamentals of Foreign Exchange, Indian Forex Market, Direct and Indirect Quote, Some Basic Exchange Rate Arithmetic, Forward Exchange Rates
Capital Structure and Cost of CapitalMeaning of Capital Structuring, Leverage/Gearing, Factors Influencing Decision on Capital Structuring, Theories/Approaches on Capital Structuring, Net Income Approach, Net Operating Income Approach, Traditional Position, Assumptions in the Approaches on Capital Structuring, Taxation & Capital Structure, Cost of Debt, Preference, Equity, Determining the Proportions, Weighted Average Cost of Capital (WACC), Factors Affecting the WACC,Weighted Marginal Cost of Capital, Determining the Optimal Capital Budget, Divisional and Project Cost of Capital, Floatation Cost and the Cost of Capital, Misconceptions surrounding the Cost of Capital
Capital Investment Decisions/Term LoansDiscounted and Non-Discounted Cash Flow Methods for Investment Appraisal, Basicconcepts of term loans, Deferred payment Guarantees, Project financing, Difference between term loan appraisal and project appraisal
Equipment Leasing/Lease FinancingMeaning of a Lease, Features of a Lease, Types of Leases, Rationale for Leasing, Contents of a Lease Agreement, Legal Aspects of Leasing, Finance Leases, Operating Leases,Accounting of Lease Transaction in the books of Lessor and Lessee, Leasing as a Financing Decision
Working Capital ManagementWorking Capital Cycle, Cash and Marketable Securities, Accruals, Trade Credit, Working Capital Advance by Commercial Banks, Cash Budget Method of Lending, Regulation of BankFinance, Public Deposits, Inter- Corporate Deposits, Short-term loans from Financial Institutions, Rights Debentures for Working Capital, Commercial Paper, Factoring & Forfaiting
DerivativesCharacteristics & Functions of Derivatives, Users of derivatives, Futures, Forward RateAgreement (FRA), Swaps, Options

AFM Module D Syllabus – Taxation and Fundamentals of Costing

The syllabus for Module D of AFM is below:

Taxation: Income Tax/TDS/Deferred TaxOverview of Income Tax Act, Basic Overview of Deductions in Respect of Certain Incomes & Deduction 80 QQB, 80 RRB, 80 TTA & 80U, TDS/TCS, Returns, Refund & Recovery
Goods & Services TaxMeaning of Direct & Indirect Tax, Introduction to GST
An Overview of Cost & Management AccountingCost Accounting: Evolution, Meaning, Objectives and Scope, Concepts of Costs,Classifications and Elements of Cost, Cost Centre and Cost Unit, Methods and Techniques ofCosting, Cost Accounting Standards, Management Accounting: Evolution, Meaning,Objectives and Scope. Tools and Techniques of Management Accounting, Relationship of Cost Accounting, Financial Accounting, Management Accounting and Financial Management 
 Costing MethodsUnit and Output Costing, Job Costing: Job Cost Cards, Collecting Direct Costs, Allocation of Overheads and its Applications, Batch Costing: Features and Applications, Contract Costing: Features, Distinction between Job and Contract Costing, Progress Payments, Retention Money, Escalation Clause, Contract Accounts, Accounting for Material, Accounting for Plant Used in a Contract, Contract Profit and Accounting Entries, Process Costing: Features, Applications and Types of Process Costing, Process Loss, Abnormal Gains and Losses, Equivalent Units, Inter-Process Profit, Joint Products, By-Products and Accounting, Service Costing: Features and Applications, Unit Costing and Multiple Costing, Application, Identification of Cost Unit and Cost Determination and Control 
 Standard CostingDefinition, Significance and Applications, Various Types of Standards, Installation of Standard Costing System—for Material, Labour, and Overhead, Variance Analysis for Materials, Labourand Overheads and Accounting Treatment of Variances, Benchmarking for Setting of Standards, Variance Reporting to Management
 Marginal CostingMeaning, Advantages, Limitations and Applications, Breakeven Analysis, Cost-Volume ProfitAnalysis, P/V Ratio and its Significance, Margin of Safety, Absorption Costing: System of Profit Reporting and Stock Valuation, Difference between Marginal Costing and Absorption Costing, Income Measurement under Marginal Costing and Absorption Costing
Budgets and Budgetary ControlBudget Concept, Manual, Fixed and Flexible Budgets, Preparation and Monitoring of VariousTypes of Budgets, Budgetary Control System: Advantages, Limitations and Installation, Zero Based Budgeting, Programme and Performance Budgeting

JAIIB AFM Syllabus – Frequently Asked Questions

Q1. How many questions are asked for JAIIB AFM?

A1. JAIIB AFM ie. JAIIB Paper 3 consists of 100 questions for 100 marks.

Q2. JAIIB AFM has how many modules?

A2. The Accounting and Financial Management paper for JAIIB has a total of 4 modules.


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