Importance of BCK for Chartered Accountants CA Foundation Notes | EduRev

Business and Commercial Knowledge

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CA Foundation : Importance of BCK for Chartered Accountants CA Foundation Notes | EduRev

The document Importance of BCK for Chartered Accountants CA Foundation Notes | EduRev is a part of the CA Foundation Course Business and Commercial Knowledge.
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The Chartered Accountants are the custodians of a nation’s resources. They are responsible for putting in place a credible system of truthful and fair accounting and reporting of the society’s resources, their deployment and utilisation. Business and commercial sector comprises a large share of their work arena. In this context BCK is likely to make them more aware and responsive. Each business has its own peculiarities and associated variation in notions of product, inventory, revenue, profit, etc. For

example, a fast moving consumer goods (FMCG) business pertains to manufacture, distribution and sale of a large variety of staples (groceries, bakery, confectioneries, etc.), personal care and home care products such as soaps and detergents, toiletries and cosmetics etc. The Chartered Accountant can easily develop notions of cost, inventory, revenue, profits etc. However, in hotels & restaurants these notions change. Moreover, in

addition to certain common laws that all businesses are subject to , each business is subjected to a host of  laws specific to it. The Chartered Accountants shall be able to conduct the audit diligently only when they understand the nuances of the business whose accounts they prepare or audit.
Getting conversant with and updating BCK

We have noted that BCK domains are vast, eclectic and ever expanding. We are also convinced that BCK is important for a successful education & career as a Chartered Accountant. Now, how do we get to terms with BCK especially if we do not have a prior background e.g. 10+2 or degree in commerce? The task indeed seems Herculean! And to top it there is a constant dilemma whether to focus on specialisation / core discipline i.e.

accounting and taxation or diffuse our energy to such a wide topic as “business?” Take a trip to the tips for enhancing one’s BCK Quotient (BQ) #1.
Enhancing BQ #1

Self AssuranceBusiness is all around. We encounter it, engage with it in numerous transactions on a daily basis.
Non-commerce background is not ahandicapIf you had science, use the bridge of technology to crossover to business. If you had humanities then there are several bridges connecting with business: economics for sure; history of daily lives and livelihoods; geography- the resources, the occupations; psychology & sociology- understanding of human behaviour and so on. Leverage the eclectic nature of BCK.
Observation andExperience are the bestguidesIt is all about becoming slightly more conscious of our sensory activities. Maybe an article in a newspaper, a TV Commercial or a Business News, a visit to aMarket or a Mall, Browsing of the Net or a smartphone App.
Each one of us have sixhonest servantsYes! Rudyard Kipling reminds us:
    keep six honest serving men
    (They taught me all I knew);
    Their names are What and Why and When
    And How and Where and Who.
Excerpted from ‘Elephant’s Child’
We may therefore wear our looking glasses and set out on an exploratory journey.
Practice andImprovement viaReffective Thinking leadsto perfectionWe may maintain a daily journal of BCK wherein we record our observationsand organize our readings, viewings, listenings etc.

An Illustrative List of Sources of Enhancing BCK

Note: Its not an inclusive list but a convenient sampling
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