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Toggle navigationCOURSESign In / Sign UpPast Year PapersCA Intermediate Syllabus (New) For May and Nov 2018 and Chapter wise WeightageBy Admin |150 Views (0) (0)Check CA Intermediate (Earlier CA IPCC) Revised Syllabus for May 2018 and November 2018 and Marks Weightage. In our latest articles, we have given CA IPCC Study Material & Practice Manual For Nov 2017 and CA IPCC RTP For November 2017. Today we are providing CA Intermediate Group - 1 and Group - 2 new syllabus which is applicable from May 2018 attempt. There are 8 papers in CA Intermediate I;e Accounting, Corporate and Other Laws, Cost and Management Accounting, Taxation, Advanced Accounting, Auditing and Assurance, Enterprise Information Systems & Strategic Management and Financial Management & Economics for Finance. May 2019 is the last attempt to write CA IPCC in old syllabus. Later, old registration students should also write CA Intermediate in new syllabus. Now check CA Intermediate course syllabus and marks weightage.CA Intermediate Accounting Syllabus(One paper – Three hours – 100 Marks)Weightage: 20% to 25%1. Process of formulation of Accounting Standards including Ind ASs (IFRS converged standards) and IFRS; convergence or adoption; objective and concepts of carve outs.2. Framework for Preparation and Presentation of Financial Statements (as per Accounting Standards)3. Applications of Accounting Standards:- AS 1: Disclosure of Accounting Policies- AS 2: Valuation of Inventories- AS 3: Cash Flow Statements- AS 4: Contingencies and Events occurring after the Balance Sheet Date- AS 5: Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting Policies- AS 10: Property, Plant and Equipment- AS 11: The Effects of Changes in Foreign Exchange Rates- AS 12: Accounting for Government Grants- AS 13: Accounting for Investments- AS 16: Borrowing Costs- AS 17: Segment Reporting- AS 22: Accounting for Taxes on IncomeWeightage: 25% to 30%4. Company Accounts- Redemption of preference shares- Redemption of debentures- Accounting for bonus issue and right issue- Accounting for tax: Concept of deferred tax asset and deferred tax liability in line with AS 22 “Accounting for Taxes”- Managerial Remuneration- Preparation of financial statements – Statement of Profit and Loss, Balance Sheet and Cash Flow Statement- Profit (Loss) prior to incorporation;Weightage: 30% to 35%5. Accounting for Special Transactions:- Investment- Insurance claims for loss of stock and loss of profit- Hire - purchase and Instalment Sale Transactions6. Special Type of Accounting- Departmental Accounting- Accounting for Branches including foreign branches- Accounts from Incomplete RecordsWeightage: 15% to 20%7.Dissolution of partnership firms including piecemeal distribution of assets; Amalgamation of partnership firms; Conversion of partnership firm into a company and Sale to a company; Issues related to accounting in Limited Liability Partnership.Note : If either a new Accounting Standards (AS), Announcements and Limited Revisions to AS are issued or the earlier one are withdrawn or new AS, Announcements and Limited Revisions to AS are issued in place of existing AS, Announcements and Limited Revisions to AS, the syllabus will accordingly include/exclude such new developments in the place of the existing ones with effect from the date to be notified by the Institute.CA Intermediate Corporate and Other Laws Syllabus(One paper – Three hours - 100 Marks)Part 1: Company Law (60 Marks)The Companies Act, 2013 – Sections 1 to 148Weightage: 30% to 40%- Preliminary- Incorporation of Company and Matters Incidental thereto- Prospectus and Allotment of Securities- Share Capital and DebenturesWeightage: 30% to 40%- Acceptance of Deposits by companies- Registration of Charges- Management and AdministrationWeightage: 25% to 35%- Declaration and payment of Dividend- Accounts of Companies- Audit and AuditorsNote: The provisions of the Companies Act, 1956 which are still in force would form part of the syllabus till the time their corresponding or new provisions of the Companies Act, 2013 are enforced.Part 2: Other Laws (40 Marks)1.The Indian Contract Act, 1872 (Specific contracts covered from section 123 onwards): Contract of Indemnity and Guarantee, Bailment, Pledge, Agency Weightage: 25% to 35%2.The Negotiable Instruments Act, 1881: Meaning of Negotiable Instruments, Characteristics, Classification of Instruments, Different provisions relating to Negotiation, Negotiability, Assignability, Right and Obligation of parties, presentment of Instruments, Rules of Compensation Weightage: 20% to 35%3.The General Clauses Act, 1897: Important Definitions, Extent and Applicability, General Rules of Construction, Powers and Functionaries, Provisions as to Orders, Rules, etc. made under Enactments, Miscellaneous Weightage: 20% to 25%4.Interpretation of statutes: Rules of Interpretation of statutes, Aids to interpretation, Rules of Interpretation/construction of Deeds and Documents Weightage: 15% to 25%Note: If new legislations are enacted in place of the existing legislations, the syllabus would include the corresponding provisions of such new legislations with effect from a date notified by the Institute. Similarly, if any existing legislation ceases to have effect, the syllabus will accordingly exclude such legislation with effect from the date to be notified by the Institute.The specific inclusions/exclusions in the various topics covered in the syllabus will be effected every year by way of Study Guidelines, if required.CA Intermediate Cost and Management Accounting Syllabus(One Paper- Three hours- 100 Marks)Weightage: 10% to 15%1.Overview of Cost and Management Accounting(i) Introduction to Cost and Management Accounting- Objectives and Scope of Cost and Management Accounting,- The users of Cost and Management accounting information- Functions of management accounting.- Role of cost accounting department in an organisation and its relation with other departments.- Installation of Costing System- Relationship of Cost Accounting, Financial Accounting, Management Accounting and Financial Management.- Cost terms and Concepts- Cost Reduction and Cost Control- Elements of Costs- Cost behavior pattern, Separating the components of fixed, variable, semi- variable and step costs.- Methods of Costing, Techniques of Costing.- Cost Accounting with use of Information Technology.(ii) Elements of Cost and preparation of Cost Sheets- Functional classification and ascertainment of cost- Preparation of Cost Sheets for Manufacturing sector and for Service sectorWeightage: 35% to 40%2. Ascertainment of Cost and Cost Accounting System(i) Material Cost- Procurement procedures- Store procedures and documentation in respect of receipts and issue of stock, Stock verification,- Valuation of material receipts,- Inventory control* Techniques of fixing level of stocks- minimum, maximum, re-order point, safety stock, determination of optimum stock level,* Determination of Optimum Order quantity- Economic Order Quantity (EOQ),* Techniques of Inventory control- ABC Analysis, Fast, Slow moving and Non moving (FSN), High, Medium, Low (HML), Vital, Essential, Desirable (VED), Just-in-Time (JIT)- Stock taking and perpetual inventory system, use of control ratios,- Inventory Accounting- Consumption- Identification with products of cost centres, Basis for consumption entries in financial accounting, monitoring consumption.(ii)Employee Cost- Attendance and Payroll procedures* Elements of wages- Basic pay, Dearness Allowance, Overtime, Bonus, Holiday and leave wages, Allowances and perquisites.- Employee Cost Control- Employee Turnover- Methods of calculating employee turnover, causes of employee turnover, effects of employee turnover.- Utilisation of Human Resource, Direct and indirect employee Cost, charging of employee cost, Identifying employee hours with work orders or batches or capital jobs.- Remuneration systems and incentive schemes* Time Rate System, Piece Rate System, Differential piece rate system, Calculation of wages, Effective Wages.(iii) Direct Expenses- Direct expenses- Nature of Direct or Chargeable expenses.- Sub-contracting- Control on material movements, Identification with the main product or service.(iv) Overheads- Functional analysis- Factory, Administration, Selling, Distribution, Research and Development.- Behavioral analysis- Fixed, Variable and Semi- Variable.- Allocation and Apportionment of overheads using Absorption Costing Method.- Factory Overheads- Primary and secondary distribution,- Administration Overheads- Method of allocation to cost centres or products,- Selling & Distribution Overheads- Analysis and absorption of the expenses in products/ customers, impact of marketing strategies, cost effectiveness of various methods of sales promotion.- Treatment of Research and development cost in cost accounting.(v) Concepts of Activity Based Costing (ABC)(vi) Recording and Accounting of Costs- Non-integrated Cost Accounting system- Ledger under non-integral system- Integrated (Cost and Financial) Accounting system- Ledgers under integral system.- Difference between the Nonintegrated and Integrated Accounting system.- Reconciliation of profit as per Cost and Financial Accounts (under Non- Integrated Accounting System).Weightage: 25% to 30%3.Methods of Costing(i) Single Output/ Unit Costing(ii) Job Costing: Job cost cards and databases, collecting direct costs of each job, attributing overheads to jobs, Application of job costing.(iii) Batch Costing: Determination of optimum batch quantity, Ascertainment of cost for a batch, Preparation of batch cost sheet, Treatment of spoiled and defective work.(iv) Contract Costing- Ascertainment of cost of a contract, Progress payment, Retention money, Escalation clause, Cost plus contract, Value of work certified, Cost of Work not certified.- Determination Value of work certified, Cost of work not certified, Notional or Estimated profit from a contact.(v) Process/ Operation Costing- Process cost recording, Process loss, Abnormal gains and losses, Equivalent units of production, Inter-process profit, Valuation of work in process.- Joint Products- Apportionment of joint costs, Methods of apportioning joint cost over joint products,- By-Products- Methods of apportioning joint costs over by-products, treatment of By-product cost.(vi) Costing of Service Sectors- Determination of Costs and Prices of services of following sectors/ Industries:* Transport, Toll roads, Hospitals, Canteen/ Restaurants, Hotels/ Lodges, Educational Institutions, Financial Institutions/ Banks, Insurance, IT sector and other services.Weightage: 20% to 25%4.Cost Control and Analysis(i) Standard Costing- Setting up of Standards, Types of Standards, Standard Costing as method of performance measurement.- Calculation and Reconciliation of Cost Variances* Material Cost Variance, employee Cost Variance, Variable Overheads Variance and Fixed Overhead Variance.(ii) Marginal Costing- Basic concepts of marginal costing, Contribution margin, Break-even analysis, Break –even and profit volume charts, Contribution to sales ratio, Margin of Safety, Angle of Incidence, Cost-Volume-Profit Analysis (CVP), Multi- product break- even analysis, Consideration of Limiting factor (key factor),- Determination of Cost of a product/ service under marginal costing method, determination of cost of finished goods, work-in-progress,- Comparison of Marginal costing with absorption costing method- Reconciliation of profit under the both methods,- Short term decision making using the above concepts (basic / fundamental level).(iii) Budget and Budgetary Control- Meaning of Budget, Essentials of Budget, Budget Manual, Budget setting process, Preparation of Budget and monitoring procedures.- The use of budget in planning and control- Flexible budget, Preparation of Functional budget for operating and non- operating functions, Cash budget, Master budget,- Introduction to Principal/ Key budget factor, Zero Based Budgeting (ZBB), Performance budget, Control ratios and Budget variances.CA Intermediate Taxation Syllabus(One paper ? Three hours – 100 Marks)Section A: Income Tax Law (60 Marks)Weightage: 5% to 10%1. Basic Concepts- Income-tax law: An introduction- Important definitions in the Income-tax Act, 1961- Concept of previous year and assessment year- Basis of Charge and Rates of TaxWeightage: 10% to 15%2. Residential status and scope of total income- Residential status- Scope of total incomeWeightage: 25% to 30%3.Incomes which do not form part of total income (other than charitable trusts and institutions, political parties and electoral trusts)- Incomes not included in total income- Tax holiday for newly established units in Special Economic Zones4.Heads of income and the provisions governing computation of income under different heads- Salaries- Income from house property- Profits and gains of business or profession- Capital gains- Income from other sourcesWeightage: 15% to 20%5.Income of other persons included in assessee's total income- Clubbing of income: An introduction- Transfer of income without transfer of assets- Income arising from revocable transfer of assets- Clubbing of income of income arising to spouse, minor child and son’s wife in certain cases- Conversion of self-acquired property into property of HUF6. Aggregation of income; Set-off, or carry forward and set-off of losses- Aggregation of income- Concept of set-off and carry forward and set-off of losses- Provisions governing set-off and carry forward and set-off of losses under different heads of income- Order of set-off of losses7. Deductions from gross total income- General provisions- Deductions in respect of certain payments- Specific deductions in respect of certain income- Deductions in respect of other income- Other deductionsWeightage: 20% to 25%8. Computation of total income and tax liability of individuals- Income to be considered while computing total income of individuals- Procedure for computation of total income and tax liability of individualsWeightage: 10% to 15%9. Advance tax, tax deduction at source and introduction to tax collection at source- Introduction- Direct Payment- Provisions concerning deduction of tax at source- Advance payment of tax- Interest for defaults in payment of advance tax and deferment of advance tax- Tax collection at source – Basic concept- Tax deduction and collection account number10. Provisions for filing return of income and self-assessment- Return of Income- Compulsory filing of return of income- Fee and Interest for default in furnishing return of income- Return of loss- Provisions relating to belated return, revised return etc.- Permanent account number- Persons authorized to verify return of income- Self-assessmentSection B: Indirect Taxes (40 Marks)Weightage: 30% to 35%1.Concept of indirect taxes- Concept and features of indirect taxes- Principal indirect taxes2.Goods and Services Tax (GST) Laws- GST Laws: An introduction including Constitutional aspects- Levy and collection of CGST and IGST* Application of CGST/IGST law* Concept of supply including composite and mixed supplies* Charge of tax* Exemption from tax* Composition levy- Basic concepts of time and value of supply- Input tax creditWeightage: 20% to 30%- Computation of GST liabilityWeightage: 25% to 40%- Registration- Tax invoice; Credit and Debit Notes; Electronic waybill- Returns- Payment of tax including reverse chargeWeightage: 0% to 5%- Concept of indirect taxes - Concept and features of indirect taxes; Principal indirect taxes- GST Laws: An introduction including Constitutional aspectsNote – If any new legislation(s) is enacted in place of an existing legislation(s), the syllabus will accordingly include the corresponding provisions of such new legislation(s) in place of the existing legislations) with effect from the date to be notified by the Institute. Similarly, if any existing legislation ceases to have effect, the syllabus will accordingly exclude such legislation with effect from the date to be notified by the Institute. Students shall not be examined with reference to any particular State GST Law.Consequential/corresponding amendments made in the provisions of the Income-tax law and Goods and Services Tax laws covered in the syllabus of this paper which arise out of the amendments made in the provisions not covered in the syllabus will not form part of the syllabus. Further, the specific inclusions/exclusions in the various topics covered in the syllabus will be effected every year by way of Study Guidelines. The specific inclusions/exclusions may also arise due to additions/deletions every year by the annual Finance Act.Group 2CA Intermediate Advanced Accounting Syllabus(One paper – Three hours – 100 Marks)Weightage: 20% to 25%1.Accounting Standards:- AS 7: Construction Contracts AS 9 : Revenue Recognition- AS 14: Accounting for Amalgamations- AS 18 : Related Party Disclosures- AS 19: Leases- AS 20 : Earnings Per Share- AS 24 : Discontinuing Operations- AS 26 : Intangible Assets- AS 29 : Provisions, Contingent Liabilities and Contingent Assets.2. Application of Guidance Notes issued by the ICAI on specified accounting aspects. Company AccountsWeightage: 35% to 40%3.Special Aspects of Company Accounts- Accounting for employee stock option plan- Buyback of securities- Equity shares with differential rights- Underwriting of shares and debentures.4.Reorganization of Companies- Accounting for Amalgamation (excluding inter-company holding) and reconstruction- Accounting involved in liquidation of companies.Weightage: 15% to 20%5.Financial Reporting of Banking, Financial Services and Insurance (BFSI)- Insurance companies,- Banking companies and- Non-Banking Financial Companies- Mutual funds and regulatory requirements thereof.Weightage: 20% to 25%6.Valuation of goodwill7.Consolidated Financial StatementsConcept of consolidation and simple problems on Consolidated Financial Statements with single subsidiary (excluding problems involving acquisition of Interest in Subsidiary at Different Dates; Different Reporting Dates; Disposal of a Subsidiary and Foreign Subsidiaries)Notes :1.If either a new Accounting Standards (ASs), Announcements and Limited Revisions to ASs are issued or the earlier one are withdrawn or new ASs, Announcements and Limited Revisions to AS are issued in place of existing ASs, Announcements and Limited Revisions to AS, the syllabus will accordingly include/exclude such new developments in the place of the existing ones with effect from the date to be notified.2.The specific inclusions/exclusions, in any topic covered in the syllabus, will be effected every year by way of Study Guidelines. The list of applicable Guidance Notes in Accounting will also form part of the Study Guidelines.CA Intermediate Auditing and Assurance Syllabus (100 Marks)(One paper – Three hours – 100 Marks)Weightage: 20% to 25%1.Nature, Objective and Scope of AuditAuditing Concepts: Nature, objective and scope of Audit; Relationship of auditing with other disciplines;Standard Setting Process: Overview, Standard-setting process, Role of International Auditing and Assurance Standards Board (IAASB) & Auditing and Assurance Standards Board (AASB); Standards on Auditing, Guidance Note(s) issued by the ICAI;Engagement Standards: Qualities of Auditor, Elements of System of Quality Control (SQC 1 Quality Control for Firms that Perform Audits and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements); Ethical requirements relating to an audit of financial statements; Inherent Limitations of an audit (SA 200 Overall Objectives of the Independent Auditor and the Conduct of an Audit in Accordance with Standards on Auditing); Preconditions for an audit; Audit Engagement; Agreement on Audit Engagement Terms; Terms of Engagement in Recurring Audits (SA 210 Agreeing the Terms of Audit Engagements); Leadership Responsibilities for Quality on Audits; Concept of Auditor’s Independence; Threats to Independence; Acceptance and Continuance of Client Relationships and Audit Engagements (SA 220 Quality Control for an Audit of Financial Statements).2.Audit Strategy, Audit Planning and Audit ProgrammeAudit Strategy; Audit planning (SA 300); Audit programme; Development of Audit Plan and Programme, Control of quality of audit work - Delegation and supervision of audit work; Materiality and Audit Plan; Revision of Materiality; Documenting the Materiality; Performance Materiality (SA 320 Materiality in Planning and Performing an Audit).Weightage: 5% to 15%3.Audit Documentation and Audit EvidenceConcept of Audit Documentation; Nature & Purpose of Audit Documentation; Form, Content & Extent of Audit Documentation; Completion Memorandum; Ownership and custody of Audit Documentation (SA 230 Audit Documentation); Audit procedures for obtaining audit evidence; Sources of evidence; Relevance and Reliability of audit evidence; Sufficient appropriate audit evidence, Evaluation of Audit Evidence (SA 500 Audit Evidence); Written Representations as Audit Evidence; Objective of Auditor regarding Written Representation; Management from whom Written Representations may be requested; Written Representations about Management’s Responsibilities (SA 580 Written Representations); Obtaining evidence of existence of inventory; Audit procedure to identify litigation & claims (SA 501 Audit Evidence - Specific Considerations for Selected Items); External confirmation procedures; Management's refusal to allow the auditor to send a confirmation request; Negative Confirmations (SA 505 External Confirmations); Audit evidence about opening balances; Accounting policies relating to opening balances; Reporting with regard to opening balances (SA 510 Initial Audit Engagements-Opening Balances); Meaning of Related Party; Nature of Related Party Relationships & Transactions; Understanding the Entity's Related Party Relationships & Transactions (SA 550 Related Parties); Meaning of Subsequent Events; Auditor's obligations in different situations of subsequent events (SA 560 Subsequent Events); Responsibilities of the Auditor with regard to Going Concern Assumption; Objectives of the Auditor regarding Going Concern; Events or Conditions that may cast doubt about Going Concern Assumption; Audit Procedures when events or conditions are identified (SA 570 Going Concern).Weightage: 10% to 15%4.Risk Assessment and Internal Control: Audit Risk, Identifying and Assessing the Risk of Material Misstatement, Risk Assessment procedures; Understanding the entity and its environment; Internal control ,Documenting the Risks; Evaluation of internal control system; Testing of Internal control; Internal Control and IT Environment (SA 315 Identifying and Assessing the Risks of Material Misstatement Through Understanding the Entity and Its Environment); Materiality and audit risk (SA 320 Materiality in Planning and Performing an Audit); Internal audit, Basics of Standards on Internal Audit (SIAs) issued by the ICAI; Basics of Internal Financial Control and reporting requirements; Distinction between Internal Financial Control and Internal Control over Financial Reporting.Weightage: 15% to 20%5.Fraud and Responsibilities of the Auditor in this Regard: Responsibility for the Prevention and Detection of Fraud; Fraud Risk Factors; Risks of Material Misstatement Due to Fraud; Communication of Fraud (SA 240 The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements); Provisions of the Companies Act 2013 relating to fraud and rules thereunder including reporting requirements under CARO.6.Audit in an Automated Environment: Key features, Impact of IT related Risks, Impact on Controls, Internal Financial Controls as per Regulatory requirements, Types of Controls, Audit approach, Understanding and documenting Automated environment, Testing methods, data analytics for audit, assessing and reporting audit findings.7.Audit Sampling: Meaning of Audit Sampling; Designing an audit sample; Types of sampling; Sample Size and selection of items for testing; Sample selection method (SA 530 Audit Sampling).8.Analytical Procedure: Meaning, nature, purpose and timing of analytical procedures; Substantive analytical procedures, Designing and performing analytical procedures prior to Audit; investigating the results of analytical procedures (SA 520 Analytical Procedures).Weightage: 10% to 15%9.Audit of Items of Financial Statements: Audit of sale of Products and Services; Audit of Interest Income, Rental Income, Dividend Income, Net gain/loss on sale of Investments etc.Audit of Purchases, Employee benefits expenses, Depreciation, Interest expense, Expenditure on Power & Fuel, Rent, Repair to building, Repair to Machinery, Insurance, Taxes, Travelling Expenses, Miscellaneous Expenses etc.Audit of Share Capital, Reserve & Surplus, Long Term Borrowings, Trade Payables, Provisions, Short Term Borrowings & Other Current Liabilities. Audit of Land, Buildings, Plant & Equipment, Furniture & Fixtures, Vehicles, Office Equipments, Goodwill, Brand/Trademarks, Computer Software etc. Audit of Loan & Advances, Trade Receivable, Inventories, Cash & Cash Equivalent, Other Current Assets. Audit of Contingent Liabilities.(The list of items is illustrative only)10.The Company Audit: Eligibility, Qualifications and Disqualifications of Auditors;Appointment of auditors; Removal of auditors; Remuneration of Auditors; Powers and duties of auditors; Branch audit; Joint audit; Reporting requirements under the Companies Act, 2013 including CARO; Other Important Provisions under the Companies Act, 2013 relating to Audit and Auditors and Rules made thereunder.Weightage: 5% to 15%11.Audit Report: Forming an opinion on the Financial Statements; Auditor's Report- basic elements (SA 700 Forming an Opinion and Reporting on Financial Statements); Types of Modified Opinion; Circumstances When a Modification to the Auditor’s Opinion is Required (SA 705 Modification to the Opinion in the Independent Auditor’s Report); Qualification, Disclaimer, Adverse opinion (SA 706 Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent, Auditor’s Report); Nature of Comparative Information; Corresponding Figure; Comparative Financial Statements (SA 710 Comparative Information– Corresponding Figures and Comparative Financial Statements).Weightage: 10% to 20%12.Audit of Banks: Understanding of accounting system in Banks, Audit Approach, Audit of Revenue items, Special Consideration in Bank Audit with emphasis on Advances and NPAs.13.Audit of Different Types of Entities: Appointment of Auditor, Audit Procedure. Audit Report in respect of different Category of Entities mentioned below: government; Local bodies and not-for-profit organizations; Partnership Firms, Audit of different type of undertakings, i.e., Educational institutions, Hotels, Clubs, Hospitals Basics of Limited Liability Partnerships (LLPs) audit and Co-operative Societies Audit.Note:- The specific inclusions/exclusions, in any topic covered in the syllabus, will be effected every year by way of Study Guidelines.- The provisions of the Companies Act, 1956 which are still in force would form part of the syllabus till the time their corresponding or new provisions of the Companies Act, 2013 are enforced.- If new legislations/ Standards on Auditing/Guidance Notes/Statements are enacted in place of the existing legislations, the syllabus would include the corresponding provisions of such new legislations with effect from a date notified by the Institute. The changes in this regard would also form part of Study Guidelines.CA Intermediate Enterprise Information Systems and Strategic Management Syllabus(One paper – Three hours – 100 Marks)Section A: Enterprise Information Systems (50 Marks)Weightage: 15% to 25%1. Automated Business Processes- Introduction to Enterprise Business Processes, Benefits, Risks and Controls;- Diagrammatic representation of business processes using Flowcharts;- Risks and controls for specific business processes: Procure to pay (P2P), Order to cash, Inventory Cycle, Hire to Retire, Supply Chain Management, Fixed Assets etc.- Applicable regulatory and compliance requirements including computer related offences, privacy, cybercrime, Sensitive Personal Data Information of Information Technology Act, 2000Weightage: 15% to 25%2. Financial and Accounting Systems- Integrated (ERP) and non-integrated systems with related risks and controls;- Business process modules and their integration with Financial and Accounting systems.- Reporting Systems and MIS, Data Analytics and Business Intelligence- Business Reporting and fundamentals of XBRL (eXtensible Business Reporting Language).- Applicable regulatory and compliance requirementsWeightage: 15% to 25%3. Information Systems and Its Components- Components of Automated Information Systems: Application Systems, Database, Network and Operating System with related risks and controls.- Mapping of Organization structure with segregation of duties in Information Systems.Weightage: 15% to 25%4. E-Commerce, M-Commerce and Emerging Technologies- Components and Architecture of E-Commerce and M-Commerce with related risks and controls- Business process flow with its related risks and controls- Applicable regulatory and compliance requirements- Emerging technologies with its related risks and controlsWeightage: 15% to 25%5.Core Banking Systems- Components and Architecture of CBS and related risks and controls- Core modules of banking and Business process flow and its related risks and controls- Reporting Systems and MIS, Data Analytics and Business Intelligence- Applicable regulatory and compliance requirementsSection B: Strategic Management (50 Marks)Weightage: 10% to 15%1. Introduction to Strategic Management- Business Policy- Meaning and Nature of Strategic management- Business Strategy- Strategic Levels in Organizations- Strategic Management in Government and Not-for-profit organizationWeightage: 10% to 15%2.Dynamics of Competitive Strategy- Competitive Landscape- Strategic Analysis- Industry and Competitive Analysis- Core Competence- Competitive Advantage- Internal and External Analysis- SWOT Analysis- GlobalizationWeightage: 10% to 15%3.Strategic Management Process- Strategic Planning- Strategic Intent - Vision, Mission and Objectives- Strategy FormulationWeightage: 10% to 15%4.Corporate Level Strategies- Concepts and Nature of Corporate Strategy- Strategic Alternatives at Corporate Level* Growth* Stability* Expansion* Business Combinations – Mergers and Acquisitions* Strategic Alliances* Turnaround* Retrenchment and RetreatWeightage: 10% to 15%5.Business Level Strategies- Competitive Strategies at Business Level- Michael Porter’s Generic Strategies- Best-Cost Provider StrategyWeightage: 10% to 15%6.Functional Level Strategies- Marketing Strategy- Financial Strategy- Operations Strategy- Human Resource Strategy- Research and DevelopmentWeightage: 10% to 15%7.Organisation and Strategic Leadership- Organisation Structure- Strategic Business Unit- Strategic Leadership- Strategy Supportive Culture- Entrepreneurship and IntrapreneurshipWeightage: 10% to 15%8.Strategy Implementation and Control- Strategy Implementation- Strategic Change- Strategic Control- Strategy Audit- Business Process Reengineering- BenchmarkingCA Intermediate Financial Management and Economics For Finance Syllabus(One paper – Three hours – 100 Marks)Section A: Financial Management (60 Marks)Weightage: 10% to 15%1.Financial Management and Financial Analysis- Introduction to Financial Management Function* Objective and scope of financial management* Role and purpose* Financial management environment* Functions of finance executives in an organization* Financial distress and insolvency.- Financial Analysis through Ratios* Users of the financial analysis* Sources of financial data for analysis* Calculation and Interpretation of ratios:^ Analysing liquidity^ Analysing leverage^ Analysing solvency^ Analysing efficiency/ activity^ Analysing profitability* Limitations of ratio analysisWeightage: 40% to 45%2. Financing Decisions- Sources of Finance* Different Sources of Finance, Characteristics of different types of long term debt and equity finance, Method of raising long term finance* Different Sources of short term Finance* Internal fund as a source of finance* International sources of finance* Other sources of finance- Sale and leaseback, Convertible debt, Venture capital, Grants etc.- Lease Financing* Concept and Classification* Significance and Limitations of Lease Financing* Financial Evaluation of Leasing Decision- Cost of Capital* Significance of cost of capital* Factors of cost of capital* Measurement of costs of individual components of capital* Weighted average cost of capital (WACC)* Marginal cost of capital* Effective Interest rate- Capital Structure Decisions* Significance of capital structure* Determinants of capital structure* Capital structure planning and designing* Designing of optimum capital structure* Theories of Capital Structure and value of the firm- relevancy and Irrelevancy of capital structure.* EBIT- EPS Analysis, Breakeven- EBIT Analysis.* Under/ Over Capitalisation.- Leverages* Types of Leverages- Operating, Financial and Combined* Analysis of leveragesWeightage: 30% to 35%3.Capital Investment and Dividend Decisions- Capital Investment Decisions* Objective of capital investment decisions* Methods of Investment appraisal:^ Payback period, Discounted payback period^ Accounting Rate of Return (ARR),^ Net Present Value (NPV) - The meaning of NPV, Strengths and limitations of NPV method, The impact of taxation on the NPV analysis, The impact of Inflation on the NPV analysis, The working capital adjustment in an NPV analysis, Capital rationing, Equivalent Annual Costs, Adjusted present value^ Internal Rate of return (IRR)- Limitations of the IRR method, Multiple IRRs,^ Modified internal Rate of Return (MIRR)- Definition and explanation of MIRR, The process for calculating MIRR, Strengths of the MIRR approach.^ Profitability Index- Adjustment of Risk and Uncertainty in Capital Budgeting Decision* Probability Analysis* Certainty Equivalent Method* Risk Adjusted Discount Rate* Monte Carlo Simulation* Decision Tree Analysis* Scenario Analysis* Sensitivity Analysis- Dividend Decisions* Basics of Dividends* Forms of dividend* Determinants of dividend* Relevancy and Irrelevancy of Dividend Policies- Traditional Approach, Walter’s model, Gordon’s model, Modigliani and Miller (MM) Hypothesis.Weightage: 10% to 15%4.Management of Working Capital- Management of Working Capital* The management of working capital- Liquidity and Profitability* The Working capital financing decisions- Primary and Secondary Sources of Liquidity* The working Capital Cycle (operating Cycle), Effectiveness of Working Capital based on its operating and cash conversion cycles* Assessment of working capital requirement* Management of Accounts Receivables (Debtors)* Factoring and Forfaiting* Management of Accounts Payables (Creditors)* Management of Inventory* Management of Cash, Treasury management* Banking norms of working capital financeSection B: Economics For Finance (Marks: 40)Weightage: 20% to 30%1.Determination of National Income- Macro Economic Aggregates and Measurement of National Income- The Keynesian Theory of Determination of National IncomeWeightage: 20% to 30%2.The Money Market- The Concept of Money Demand: Important Theories of Demand for Money- The Concept of Money Supply- Monetary PolicyWeightage: 20% to 30%3.Public Finance- Fiscal functions: An Overview.- Market Failure- Government Interventions to Correct Market Failure- Fiscal PolicyWeightage: 20% to 30%4.International Trade- Theories of International Trade- Trade Policy – The Instruments of Trade Policy- Trade Negotiations- Exchange Rates and its economic effects- International Capital Movements: Foreign Direct InvestmentI hope this article will help you to check CA intermediate course new syllabus. 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Everywhere you turn of late, it seems there is another news bulletin about the impending demise of retail. Sure, people are always going to have a need to buy things, but as online behemoths like Amazon are really only just beginning to ramp up their global conquest, shopping as we know it might soon look dramatically different. And I know that a number of brick and mortar institutions are surely going to bite the dust. But as someone with considerable experience in this industry, I can testify that the greatest threat a traditional retailer faces isn’t from some online enemy — it’s from within the store itself.Anyone who has ever been involved in this line of work, whether in a management role or not, has surely complained at one point that the organization would be just fine if you could only hire quality help. And to some degree, yes, this is always true. But from the outside, it seems obvious that the grunts cannot possibly be to blame for a company’s misfortunes. They do not — or at least they should not — exert this kind of pull. Any organization is only as strong or as weak as the people up top. And if that company is on the downswing, then this surely rests at the feet of management or ownership or both.Obviously, none of us are without fault. We’ve all been that person at the end of a long day who didn’t feel like retrieving or making something for a customer, and told that shopper we were out of the item. If you’ve screwed around for one unauthorized minute out of a single day, then I suppose a loss prevention expert could technically claim that you were stealing time. But I’m not talking about our common human flaws. What I mean specifically are major blatant categories where upper management and ownership continually fail, as a matter of personal and often company sanctioned philosophy.Maybe these pitfalls have been around for centuries, from the moment the first businessperson set up shop and traded animal pelts for a couple of dry sticks. But I’m guessing these are mostly modern phenomenon, ones which have gone increasingly problematic for physical retail outlets as internet companies have grown. At any rate, based on my own experiences with the industry, I know that they were issues twenty years ago and continue to be today.1. Labor ShenanigansThis is a biggie, albeit one that any layperson could understand at a glance and therefore a problem you would think easily remedied. Let’s say your entry level position pays x. It is common for a specialist (cake decorator, meat cutter, et cetera) to be paid 1.5x or even 2x. Yet, as the x represents a wage that’s actually below industry standards, your company has trouble hiring entry level help. So guess what happens? The specialists wind up doing the entry level work. And yet those in charge of the purse strings refuse to budge on paying entry level help more.I’m not saying a cake decorator or meat cutter should never have to wait on the counter. But when, for example, you have your store manager running a cash register for a significant portion of every day, then you know something is probably wrong. Either you’re paying that person too much, or, more likely, you’re not paying the entry level people enough. Now, the slick upper management types with all the answers will claim that this is exactly how they drew up the blueprint, but I don’t buy it, and in fact that rationalization makes no sense. In my years working with these retailers, I’ve witnessed countless operations that would have two specialists on the clock, but no entry level clerks, meaning you’re paying a meat cutter to wait on the counter all day, for example. And this would be a weekly if not daily occurrence! Or worse still, paying a specialist time and a half to wait counter because that person is well over 40 hours. But then when I point out that, you know, you could bump up the entry level wage a buck or two, and be much more likely to keep your lower rung help around, and you could have three clerks here for what you’re paying one chef to wait counter at time and a half, the answer is generally, “oooh hooo hooo. Noooo. We’re not paying new hires off the street that much.”Which is itself a contradiction of sorts, payroll budget aside. All day long, in every meeting and every memo, you hear nothing but about how customer service is priority number one. But then at the suggestion that those tasked with serving the customers might be compensated a little more, massive chafing ensues. This doesn’t make sense philosophically, I’ve demonstrated above that it doesn’t make sense financially, and I would argue it doesn’t make sense from a production standpoint, either. You’ve hired a cake decorator to knuckle down and whip up these amazing concoctions, but then she’s constantly interrupted to shave a quarter pound of Virginia ham or dole out a half dozen wings from the hot bar. When your meat cutter is slicing one London broil steak, waiting on a customer, slicing one steak, waiting on a customer, then the quality and quantity of the work are bound to suffer.This calls to mind the closely related topic of required lunches. I’ve worked with a number of retailers who insisted employees take an unpaid half hour lunch (many have claimed this is a “state law,” but that’s mostly complete nonsense unless you are a minor) because in their minds this is some clever strategy for stretching out the coverage. In my experience, however, all this does is throw a wrench into productivity right in the heart of the day. Forget for a moment the negative impact that this has, forcing a worker who’s in a steady rhythm to abruptly halt and go chill out for 30 minutes. Because these operations are so poorly staffed — again often as a result of having, say, two specialists on the schedule that day at time and a half, rather than one specialist and three clerks — this forced lunch business often means that absolutely nothing is being accomplished in the department for an hour or more, directly in the middle of the action. Let’s say you have two employees in the department around noon on a Saturday, which is a thoroughly likely occurrence, and that there’s a steady stream of activity on the customer front. Forcing these two to disappear for a half hour apiece means that’s a solid hour where nothing is being produced in the back room and nothing is being stocked out on the floor, either. Does this sound like a solid business model?These skeleton crew staffing schemes also make any officially stated company handbook policies look laughably ridiculous. You know the material I’m talking about, the new hire paperwork which made you, as a freshly hired employee, all warm and fuzzy to note that this corporation really cares about your well-being and that, should you suffer any occurrence of diarrhea or even so much as a runny nose, then they definitely want you to stay home that day! Right. I’ve worked at a major “big box” retailer where my runny nose was dripping nonstop onto the boxes I was stocking, and yet my supervisor was visibly disgusted when I asked to leave a half hour early that day. Also, in five and a half years working with another corporation, I missed just one day, but suffice to say that in the wake of that one day I was basically treated like the scum of the earth. But then you’re expected to readily give up any scheduled days off, and come in on overtime, and this is no big thing — what do you want, a gold medal? — because there’s nobody else working in this place and we have no choice. Not to mention that it’s common practice for upper management to treat employees’ PTO hours like some kind of hilarious game, whereby these are penciled into the schedule, except then, hee hee, they are then crossed out every week, because we don’t have the staffing to permit you to enjoy these, you silly, 48 hour working specialist! But any company worth its salt is allotting for these hours in its yearly budget well in advance, and denying employees is a sure recipe for a disgruntled hence less productive workforce.2. Misplaced AttitudesWe will be charitable in this section and chalk up much of this behavior to our common human quarks. I would also like to refrain from any mention of “power tripping,” although this is often what management’s collective antics suspiciously resemble. However, whether for that reason or a litany of others, you have to often wonder whether management and ownership hasn’t completely lost sight of what your company — what any company, as far as I know — is hoping to accomplish.Much as we might like to pretend otherwise, dollars generated is the yardstick by which a retail enterprise is measured. But if transported here from another dimension and tasked with watching the average management figure for a few days, this information would come as a complete surprise to you. Certainly you would not glean such from the behavior displayed nor the speeches given.To cite one example, we’ve all surely been present for the occasional fluke day where traffic and thus sales were shockingly, unexpectedly robust. Sometimes this is due to a weather condition (impending snowstorm, power outage, threat of rain) but just as often, nobody can explain it. And for most employees out there on the floor, as cogs grinding away in the machine, these occasions are strangely exhilarating. Though exhausted afterwards and possibly unwilling to admit it throughout, the variety this onslaught provides can prove a serious monotony-buster, and it’s rewarding to see product flying off the shelves as fast as you can throw it out there.Then an upper management figure drifts upon the scene. With an almost pathological determination, they will more often than not snuff out any joy an employee displays concerning this situation. Attempts to marvel at how strong sales must be today will encounter a swift subject change. Because we are not here to high five over a terrific sales rush, we are here to point out that one hole on the third shelf from the top, second slot over. Do you see that hole? Great, now fill it. I’ll be back in a short while to check on your progress.Sure, it’s never wise to rest on one’s laurels, but there is no good reason not to enjoy success as it is happening. On a similar note, who hasn’t sat through a dreadful Monday morning meeting, and listened to something along these lines, all recited by your company leader in a nasal, list reciting voice:Electronics, you were down 1.7 percent over same day last year…shoes, you were up 2.3 percent…housewares, this was actually the strongest day your department has ever had in the ten year history of this company, so good job with that…umm, cosmetics, you were down .6 percent, garden center, you were down 1.2 percent…Followed then by an endless, droning , 45 minute lecture on how the customer count has been static for about three years now, and you all need to be doing more to increase this figure.Call me a hopeless renegade but if I’m any department head sitting through this nonsense, I would sincerely wish somehow that we could focus on the one relevant piece of information here, and chuck everything else. Certainly the guy we’ll call Hank, Head Of Housewares wishes a little more attention could be devoted to his historic day. And this doesn’t necessarily entail ticker tape parades or even so much as a gift card, but it should at the very least inspire a round table discussion, right at the top of the agenda, with everyone involved. Those minor ups and down versus last week or last period or last year, are most likely meaningless, particularly if — as is most likely the case — nobody is going to invest any kind of deep data investigation into the numbers, as they will only be numbers on some paperwork for the purposes of fleshing out this meeting (which were in any case probably emailed to and/or printed out for the department managers in advance anyway, none of which stops the chief from reciting them line for line) with what feels like a little substance. And for all the talk about customer counts that I have sat through in my lifetime, we’ve all sat through, there’s been nary an intelligent response delivered really as to what the people working inside the building are supposed to do to lure shoppers into the building. Work your damnedest to retain the current customers, yes, and build basket sizes and sales, absolutely. But outside of wearing a cow costume on the sidewalk, the only serious impact in customer counts is going to come from marketing. That’s their job.This is the most glaring omission, this theoretical push toward increasing baskets and sales in pursuit of historic days, followed by management’s clinically deranged avoidance of discussing them when they happen. But it’s by no means the only…curious philosophy commonly found on display, far from it in fact. Some of what I am witnessing is a clear attempt to establish who is in charge, as if the employees aren’t already aware. Like the new hire I recently observed, clocked out and headed home, after the store has been closed for the night. He asks the manager on duty if she should follow, and lock the door behind him after he opens it…to which she responds, with a strange edge to her voice, “you don’t open the door! Only management can open the door!”Okay, great. Should we perhaps contact a brass band as well to commemorate this occasion? They walk to the front door in lockstep, at which point, yes, she is the one twisting the knob. So technically the new hire’s question had been answered, albeit with a little more vehemence than he likely envisioned.A more substantial instance of this mindset involved a corporation I was working with, which had just received a memo from the home office concerning how late the stores were keeping people at night. Doors closed at 9, but employees were often not leaving until 10:30 or 11. The reason for this, I ultimately concluded, was that the store management insisted on this giant dog and pony show after closing time, of making everyone stand around and wait while they conducted a walk-through of each department, one at a time. Surely there was a more efficient means for getting people out of there in a brisker fashion, and they knew it. Yes, perhaps a few minor details were caught as a result of this stunt, but mostly it seemed to result in folks, if not goofing off, or hiding, or simply standing around, then maybe polishing windows or sweeping floors for the 18th time to give the appearance of staying busy. The real kicker is that management, often trailed by a mini-entourage of direct subordinates, or other random employees asking questions, would frequently stop to straighten endcaps en route to the next department. But the store was closed!Employees are not stupid, and generally know when you are screwing with them for the sake of demonstrating control. As one could imagine, workers jumping ship at these establishments was high by industry standards, another plague affecting labor budgets and therefore bottom line. Training new employees costs a great deal of money, in lost productivity, errors, and veteran workers pulled from their regular work to demonstrate procedures. And now that we’re on this topic, when employees do turn in their two weeks’ notices, please take the high road. This is another blight marring retail, on par with the runaway trend of landlords always finding some flimsy pretense for keeping a renter’s deposit: otherwise reputable companies where, the instant someone puts in a notice, tell that person to not bother returning for the remainder of their shifts. If the employee is new or has a track record of poor attendance, okay, I could see that. But when you pull this sour grapes stunt with an established worker who is moving on, all it does is engender bad blood, and set the table for getting hosed yourself down the road. Once the workforce catches on that this is becoming the new standard, guess what, they’ll probably keep their future jobs a secret and simply stop showing up at the last minute.Of course, erroneous attitudes aren’t limited to store management, or the board of directors or ownership. I remember sitting through a major meeting where one department head was arguing with great passion that we needed to raise our profit margin on the pets section. Reason being? The product was selling too well and they were having problems keeping up with stocking it. Everyone else sort of laughed this off, but I was thinking that were I running this company, this person would have just eliminated any hope of ever being promoted. That one argument was a self-installed ceiling. As always, you have to ask yourself: what are we really trying to accomplish, here?3. Rule MongeringI don’t mean this article to read as a total hatchet job against upper management. Certainly, I have worked with my fair share of leaders in the industry who were bright and did tremendous jobs. However, retail corporate culture does tend to encourage and promote creative thinkers a lot less than an average person of decent intelligence who is really good at following rules. This has its plusses and minuses. You probably have fewer concerns with a dutiful policy follower adhering to company standards. However, on the flipside, they tend to not be great at filtering priority and interpreting urgency down to their employees. So what you end up with is a huge focus on rules for the sake of rules.Some of this behavior might closely resemble that in the previous section, a need to exhibit control. But I really think much of it is really just this, a blind panic for enforcing often unimportant rules. You can read it like an uncontrollable nervous tic upon their faces. I remember one shift worked in a store where, after panicking over an employee calling in sick for a busy department, on a day they were absolutely slammed, management experiences some momentary relief when they find another worker across town who’s willing to drive over after his own shift ends, and help out. At which point this store director rips into him for daring to appear with a hooded sweatshirt on underneath his uniform shirt, because he is cold. Needless to say, that employee never helped out this other location ever again. I even have some firsthand experience in a similar situation myself, a day where, years earlier, I had agreed to pitch in at a distant location…and running into some disgruntled middle management figure there, who was in no way my superior at all, grousing to anyone who’d listen that I was supposed to be wearing a collared shirt.So while these antics are counterproductive in the sense that they contribute nothing and only serve to irritate employees, still others are far worse by directly maiming the bottom line. The most common example I see is a hysterical adherence to some corporate issued schematic. Though well-intended, and theoretically backed up by plenty of research, there will always be occasions where it makes more sense to deviate — like for example, if you are completely out of a product, and expect to be so for quite some time. If it’s a featured sales item, it might be wise to hang an apologetic sign of some sort, to head customer complaints off at the pass. But leaving holes intact for days on end because you’re waiting for one product and one product only to arrive and plug that leak is idiotic.I’ve witnessed sets that looked like checkerboards, as they contained nearly as many blanks as filled in spaces, which intentionally remained such for four days because certain products were continually scratched from deliveries. I’m sorry, but no. Fill those spaces up with something else instead. Even if that only means expanding out on what’s already there, for appearance’s sake alone, this is still a significant improvement. Sometimes you might chalk these gaps up to laziness, but just as often I’ve heard store management, and even higher up zone figures, demand that the holes remain until product arrives. The equivalent to this for online shopping would be for Amazon to decide to leave half of their home page blank because certain hoped for deals never materialized. Would they ever allow this to happen? Of course not. They will use that space to promote something, as would any company with a shred of sanity.There is a corollary flipside to this phenomenon, too, which usually concerns end caps and other huge displays, in situations where every store was auto-shipped product as part of some major buy-in. The company received a terrific price break for buying mass quantities of something from a particular distributor, and so this line is going to be featured at some hot featured price for x number of days. Usually stores can continue to re-order product for a little while at that price, though not always. At any rate the sale price is running in every location for a fixed time frame, and as this has been advertised, there’s not much anyone can do about that.But where companies screw up is also dictating that every store must dedicate a certain amount of display space to this item, and leave it in that prominent location until the promotion ends. The problem with this approach, which you should be able to appreciate with the naked eye, is that some locations are going to sell these items at a brisker pace than others. So what ends up happening is that the higher volume stores must begin reordering the product at regular price at some point to stock these huge displays. Now, you could certainly argue that these locations should instead transfer product from the slower ones, where those items are languishing. Even in the best case scenarios, however, this is never going to happen even half the time. A store that’s just killing it in the heart of Manhattan is unlikely to investigate whether the Birmingham, Alabama outpost can’t give the stuff away, and it might not make any sense logistically to facilitate that transfer even if it did. Instead, in the most extreme examples, these stores are reordering the product at a higher cost than the hot advertised retail, because they’re not permitted to downplay the sale, move the stuff elsewhere, or cut down on its display space. You can put a sunny spin on the situation by calling these items “loss leaders” if you like, or whatever, but the reality is that they are now underwater on these products, a problem compounded in that these are your busier stores.Not every issue in this category can be laid at the feet of corporate demands, however. Sometimes you just have to chalk it up to a store or zone’s leadership exhibiting a little too much enthusiasm for meaningless or at least non-urgent rules, usually of their own creation. That day where you’re setting your all-time record for sales in the houseware section? Yeah, this might not be the time to start nitpicking about conditions. Or the guy wearing the hoodie, or as you commonly see, pick this as the day where you absolutely must hassle the help about an upcoming health department or weights and measures inspection. We can debate the motivations which lead management to behave this way — and I’ll withhold my opinion for the time being — but whatever the case, one of their primary functions is to pump a team up and generate some excitement for increasing sales, maximizing profits. And yet in the world of brick and mortar retail, you see the opposite occurring almost I would say more often than not. Fist pounding pronouncements which produce the reverse of what was intended, to frequent comical effect.One of the more amusing examples of this concerns a high volume item which is produced in-store and takes a great deal of time or effort to crank out. Yet is one which either the store or district manager has decreed must be filled to a certain level at store close, every night, without exception. It might surprise many to hear this, but guess what eventually begins to happen when management is excessively tyrannical about this topic? Employees start making up plenty of the item, during slower moments earlier in the day, but then leaving it in the back room for as long as possible. The last thing they want to do is to put this product out, or to actually sell it. If you’ve demanded that they have ten elaborately decorated Disney princess sheet cakes out on the floor when the lights go off at 9pm, usually under the auspice of “making sure we’re ready to go in the morning,” and it’s 8pm and they have exactly ten in back but none on the floor, then they’re gritting their teeth and hoping the situation holds for the next 59 minutes or so and nobody notices. Under extreme situations of duress, they might even tell an inquiring customer that they are out. Avoiding your wrath has taken priority for them over making a sale. I’ve worked with enough companies where this was happening to know these probably weren’t isolated flukes, and that it’s surely an epidemic all over the place when dealing with ridiculous edicts.Some unfortunate rule making does result from the exact inverse however — not from a supervisor’s heavy handedness, but rather due to their caving in the face of a whining workforce. This is most applicable to the subject of scheduling, usually when handling the always touchy nights and weekends issues. I can offer for you a firsthand parable about a seafood department where there were three veteran employees who worked well together, and at 40 hours apiece, this broke down to one closer, one opener, and one midshift on Friday, every week. The department manager wanted every Sunday off, in part to coach his son’s football team, and took Wednesdays as his other, for it was the slowest shift. Another guy wanted two days off in a row, leaving only Monday and Tuesday to accommodate this request. The third guy was given every Saturday and Thursday off to fill in the blanks, and for roughly six months, this system worked beautifully. It was a happy, productive, and profitable department.But what inevitably brought about its downfall, as you can imagine, had nothing to do with business reasons whatsoever and everything to do with employees in other departments demanding that management put a stop to this. Various individuals in, say, the grocery section were bellyaching that it was “unfair” that a couple of these seafood guys got a weekend day off every week, and the same one at that. Obviously these characters couldn’t seriously expect that their nine person crew or whatever would all also be awarded a weekend day off every schedule, as this was an impossible request. Instead of explaining this to them, however, that every department presents a different set of circumstances, and possibly suggest that they transfer to seafood if they didn’t like it, store managers instead told the seafood gang they would have to start randomizing the schedule more.This is admittedly a much slighter discussion than the one involving night shifts, however, where what has somehow become the default industry model doesn’t make a whole lot of sense. Somehow, a mindset has seized retail whereby it’s also considered “unfair” to schedule people to work nights. Circling back to the topic of those specialists you have hired to perform a specific function, more often than not, that specific job entails working first thing in the morning, if not hours before the store opens. But to appease the whining masses, many operations have a policy in place that everyone must work one night shift a week. Thus you now have, say, dedicated pastry makers being paid extra to do nothing of the sort at least 20% of the time. Some places even go as far as to demand that departments split up the opening shifts evenly, an even more disastrous policy. One major grocery chain I worked with insisted on this policy, much to the bewilderment of head butchers who were opening one day, closing one night, and pulling three midshifts per week…all the while arguing with an upper management brigade who couldn’t understand why payroll was up and productivity down. Management would be far better served explaining to their entry level employees that the specialists have been hired to perform specific functions, and need to work certain hours to accommodate this.4. Role ComprehensionBut of course, the reason a lot of these rules exist is that management and ownership don’t really know what’s going on inside a department. Grand pronouncements give them a shorthand method for viewing at a glance whether a store is on track — or at least, this is what they like to believe. But this is perhaps one of the most pervasive myths afflicting owners and executives, the notion that they are acutely aware of who does what, and the inner workings of particular programs which make this happen.I have heard that Steve Jobs’ personal philosophy was that every Apple employee should know how to perform every role. Whether or not this is actually true, I can’t say, but it sounds like a good place to start. This wouldn’t have to require upper management figures brushing up on the finer points of every single program used by their companies, but detailed knowledge of how work flows, through whom, and how long this should take — in other words the rudimentary details of every person’s daily routine — is essential. Yet whether through arrogance, inattention, or a dismissive attitude toward this level of comprehension, I’ve worked with few organizations where anything of this sort transpired. Even those who feel they are paying attention and have a keen awareness of every employee’s productivity often could not tell you how long this task took former workers, or those in similar roles at other stores, and just how effective their own team members are. It reminds me of my favorite ever observation, in response to a company adamantly opposed to letting its office people work remotely.“But then we wouldn’t know if they were actually doing anything, or just screwing around,” the VP had objected.“Well, I hate to tell you this,” I replied, “but you’ve had people working here in the office, and you didn’t know if they were doing anything, or just screwing around.”Which didn’t exactly sit well, though it happened to be true. This company believed it had a firm grip on the productivity of its people. Everyone looked busy enough, so what could possibly be the problem? Well, upon further investigation, among other horrors, they had a pricing coordinator who’d never bothered to learn Excel, was therefore punching in new items and weekly flyer prices by hand rather than uploading files; another pair of employees, asked by the CEO to determine which PLU numbers were being carried in each of the stores (for those not in the know, PLU numbers are found on produce, bulk bins, and other items without a barcode), spent untold days walking around and writing everything down by hand in notebooks instead of taking the time to learn and run a few simple reports; and in general there was a widespread epidemic of department heads calling in or emailing orders rather than scanning items via the relatively new, expensive, and start of the art inventory management software.Technically speaking, none of these examples count as “screwing around,” although there was plenty of that going on, too. More to the point, however, none of the key figures up top knew any of this was happening. Worse still, when presented with these findings, I’d wager that more than a few didn’t understand what I was talking about, and those that did in general tended to laugh or shrug off the dollars wasted by these antiquated methods: well, these are the employees we’ve got, what can we do? At least they’re working.But at least these shortcomings, however major, are inefficiencies caused by a lack of executive knowledge. More detrimental and just as common is the aforementioned corporate arrogance, the attitude that they and they alone know what this company needs, how things work, and therefore they require no input from any of the people tasked with actually handling this stuff on a daily basis. Let me clarify that by no means is the purpose of the piece to illustrate that I believe I have all the answers, either. On the contrary, whatever your role with the company, consultant included, you have to fight this very tendency that I’m railing against here. When a business first brings you aboard, you want to forget everything you think that you know, listen, pay attention, and only then maybe see if anything that you’ve done in the past applies to this particular company. And this is exactly the way management figures should operate, but they rarely do. Nearly all of us — upper management and ownership included — only truly know one or two disciplines in a field really, really well, and would be better served deferring to others’ expertise the remainder of the time. Possibly even in those subjects we know best as well.It always cracks me up when the same executives who were days or weeks earlier saying they knew who was working diligently and who wasn’t, will throw their hands in the air, if a time comes that they have to replace someone, and cry “well, I didn’t know what this job entailed!” should the transition inevitably prove a little less than smooth. The most memorable example of this I can think of is a company I was working with who decided they were going to fire their controller of over 20 years’ standing, at about 5:30pm on a Friday, to the surprise of virtually everyone else in the company. Surely the board did not enter into this decision lightly and had to have taken their time arriving at it. However, no immediate replacement was instituted, as the bosses casually went about recruiting one. Meanwhile, it wasn’t much more than a week before checks began bouncing left and right, to vendors, utilities, child support agencies, insurance companies, even the owner himself. It took a month to sort out this mess, up to and including freezes placed on deliveries of goods. Finding a replacement might be one thing, but it was obvious nobody had bothered figuring out what the controller did, exactly, before firing her. They had no idea she was the one making the bank deposits!These were established bosses committing a major blunder, and admittedly an extreme example. But you see similar gaffes on a regular basis, all stemming from the same basic attitude — and perhaps none is worse than when a new CEO or president is brought aboard, often followed by his inevitable old crony battalion being hired as well, and announcements about complete overhauls. You know the guy I’m talking about, the one who somehow determined in two days that everything you were doing was junk and he was replacing all your existing programs with those he’d been using at his last company. Without, of course, the input of those currently working at the present company and seasoned in dealing with this stuff.I can think of one great instance of this phenomenon, involving a newly hired director who, along with a handful of “industry guru” types he brought along with him, enacted a series of major changes over a number of months, often launching into these with baffling arrogance and inefficiency. For example deciding on a new primary distributor, shipping a ton of new product to the stores, along with a team of the distributor’s people to hang new price tags as they’d agreed to go with this supplier’s suggested retail on everything…and yet meanwhile, nobody had bothered to tell the stores that this product was arriving, and possibly worse still, nobody in pricing had the first clue that this new retail arrangement was in place! Thousands of shelf tags were on the shelves which did not match what actually rang at the registers. It wasn’t until store employees called pricing to say that the retails were “wrong” in the system that pricing even heard about this policy change. Needless to say, customers were not happy, and these stores continued their downhill slide.When confronted with examples like these, the management team would typically do the whole bit where they’d hold up their hands like stop signs and whisper, “okay, okay! I didn’t know how these things work!” But when I would kindly suggest that if this is true, then maybe they shouldn’t go around making such grand pronouncements without involving the people who would have to enact these changes, or that they should possibly even stay out of daily operations entirely, this tended to not go so well.Sadly, I would say this isn’t an isolated example, but emblematic of the industry as a whole. Obviously there are always going to be some folks who get off on walking around telling people exactly how things are going to be done, whether they know the first thing about the subject or not. But this is just one symptom of a major sickness. In my experience, there’s a huge breakdown in retail between what’s discussed up top and what actually happens at the store level. This is the basic flow chart for significant decisions, enacted way too often for way too many brick and mortar retail operations:1. Bigwigs decide on major course of action without consulting any of the departments beneath them (IT, logistics, merchandising, receiving, pricing, et cetera)2. Departments are only informed at last minute, or even after the fact3. Departments are nonetheless only now asked if:a) They would recommend doing it this way andb) If they can make their part of this happen pronto4. Departments reply that:a) No, they would not recommend doing it this way andb) No, they are not going to be able to make this happen right this second5. Bigwigs counter with:a) Accusing them of having negative attitudes, and/or standing in the way of progressb) Too bad, drop whatever you’re doing and make this happen right now anyway6. Departments nonetheless are the ones taking the fall when things inevitably go haywireEven if nothing this extreme is happening at your particular operation, there are a whole lot of smaller recurring themes which probably are surfacing, and just as surely rot you from within. All stemming from this same basic concept, of folks not really knowing who does what — and not just management, but everyone. It negatively affects you when it comes to unbalanced compensation, for overpaying some and not paying others enough; it negatively affects you in the form of misdirected complaints, when employees are wasting a bunch of time notifying IT about erroneous clock punches, or people are asking the pricing coordinator to fix the internet, or random office employees are blamed for printers not working at the stores (sadly, yes, these are all real life experiences I have dealt with); it negatively affects you in that the complainers often set the tone for the entire company. You have surely heard the phrase the squeaky wheel gets the grease, and this is why. When upper management has no clue who does what and how things work, if you have five people quietly hitting it out of the park, but then one person constantly going to the bosses with a series of beefs, then his version becomes the accepted truth; it affects you negatively when someone might technically know his job, but not a particular application of it — for example, a wholesale company deciding to open its first ever retail outlets, and leaving the exact same management team, with no experience in the latter, intact to run both legs of the operation. Who then can’t quite wrap their heads around the various problems this creates, for example, reacting with not quite the appropriate urgency retail demands when the internet went down (taking out cash registers and credit card machines, among other functions), and why a three or five or even twenty-four hour wait for IT help is unacceptable, and why the retail arm wanted its own tech team; it negatively affects you when, in a tendency that’s the opposite of but just as common as the much maligned micromanagement, when you have a boss that can’t be bothered with details ahead of time, but then wants to constantly demand changes halfway through a project. All because he doesn’t know how things work and can’t understand why it might be disastrous to decide at the last minute, say, to keep those deli scales from the store you just acquired, maybe, even though they aren’t online and don’t connect with your current stores’ deli scale network of ingredients, nutritional facts, PLU numbers, and prices.Most of all, it affects you negatively when smooth talkers who can’t back it up with action are promoted to or hired for key positions. A basic knowledge about the entire operation — or at least a willingness to swallow some pride and pick the brains of those below them — has to start at the top of a company, or else the entire enterprise is doomed. I’m always amazed at how far some individuals get in an organization when virtually everyone beneath them has known for years that they do very little. Walking around with a serious expression at all times can take you very far, and perfecting the art of colorful jargon is even better.Ownership, the board of directors, and whoever else is in charge of making these decisions would be well served to take a hard look and ground themselves in some realism, all the while brushing up on the basic knowledge of who does what and how things work. One company I dealt with recently, it was clear within about five minutes of meeting the guy, had a president with the maturity of a six year old. But wow, he sure could whip up some colorful pie charts, and the dude definitely knew how to spin some serious industry speak. Ownership had been blown away by these qualities, over a slew of internal candidates and other external ones, many of which surely would have proven a lot less disastrous. One could only conclude that they’d never done any serious research into whether this person knew what he was talking about, mostly because of the gaps in their own knowledge. On a similar note, ask yourself why someone with a boatload of credentials is chomping at the bit to travel halfway across the country to work for your company, particularly if he’s bringing a whole crew of cronies with him. Maybe your tiny operation is going to be the next Amazon, and sure, it’s great to have ambition, but this probably isn’t going to happen. Therefore take a serious look at your business and ask yourself why this would ever realistically happen, if this character is seriously the next Jeff Bezos.ConclusionSo this is a somewhat concise summary of the problems I see plaguing traditional retail today. Without getting into a political holy war, it’s worth noting that our government is debating this very problem. We currently find ourselves in a climate where an established retail chain like Macy’s has bit the dust, and meanwhile, online juggernaut Amazon has swooped in to purchase Whole Foods. One proposed solution is the elimination of automatic overtime pay for anything over 40 hours a week (the suggested tradeoff, laughable to most hourly employees I know, is that they would be given more PTO hours — which they would definitely, absolutely get to use, with no managerial interference whatsoever!) and yet I don’t think this is any kind of answer at all. The grunts are not the problem. Neither are the internet kings who continue to gobble up larger and larger pieces of the consumer pie. Yes, they are a threat, but for retail to obsess over this challenge and ignore their own failures is akin to wringing your hands over the fact that the sun is someday going to explode, and therefore concluding you no longer need to eat. Unless these enterprises right the ship up top, and get their own houses in order, brick and mortar retail will continue to be a declining industry.

Labor Law of the People's Republic of ChinaAdopted at the Eighth Meeting of the Standing Committee of the Eighth National People’s Congress on July 5, 1994, and promulgated by Order No. 28 of the President of the People’s Republic of China Supplementary ProvisionsChapter 1 General ProvisionsArticle 1 This Law is formulated in accordance with the Constitution in order to protect the legitimate rights and interests of laborers, readjust labor relationships, establish and safeguard the labor system suiting the socialist market economy, and promote economic development and social progress.Article 2 This Law applies to enterprises, individually-owned economic organizations (hereinafter referred to as the employer) and laborers who form a labor relationship with them within the boundary of the People's Republic of China.State departments, institutional organizations and social groups and laborers who form a labor relationship with them shall follow this Law.Article 3 Labourers have the right to be employed on an equal basis, choose occupations, obtain remunerations for labor, take rests, have holidays and leaves, receive labor safety and sanitation protection, get training in professional skills, enjoy social insurance and welfare treatment, and submit applications for settlement of labor disputes, and other labor rights stipulated by law.Laborers shall fulfill their tasks of labor, improve their professional skills, follow rules on labor safety and sanitation, observe labor discipline and professional ethics.Article 4 The employer shall establish and perfect rules and regulations in accordance with the law and guarantee that laborers enjoy labor rights and fulfill labor obligations.Article 5 The State shall take various measures to promote employment, develop vocational education, formulate labor standards, regulate social incomes, perfect social insurance, coordinate labor relationships, and gradually raise the living level of laborers.Article 6 The State shall advocate laborers' participation in social voluntary labor, labor competition, and activities of forwarding rational proposals; encourage and protect laborers in scientific research, technical renovation, and invention; and commend and award labor models and advanced workers.Article 7 Labourers shall have the right to participate in and organize trade unions in accordance with the law.Trade unions shall represent and safeguard the legitimate rights and interests of laborers, and stage activities independently in accordance with the law.Article 8 Laborers shall take part in democratic management through workers' congress, workers' representative assembly, or any other forms in accordance with the law, or consult with the employer on an equal footing about the protection of the legitimate rights and interests of laborers.Article 9 The labor-management department under the State Council shall take charge of the management of labor of the whole country.Local people's governments above the county level shall take charge of the management of labor in areas under their jurisdiction.Chapter 2 Promotion of EmploymentArticle10 The State shall create employment conditions and expand employment opportunities through the promotion of economic and social development.The State shall encourage enterprises, institutional organizations, and social groups to start industries or expand businesses within the scope allowed by stipulations of laws and administrative decrees for the purpose of increasing employment.The State shall support laborers to organize and employ themselves on a voluntary basis and to get employed in individual businesses.Article 11 Local people's governments at various levels shall take measures to develop various kinds of job agencies and provide employment services.Article 12 Labourers shall not be discriminated against in employment due to their nationality, race, sex, or religious belief.Article 13 Women shall enjoy equal rights as men in employment. Sex shall not be used as a pretext for excluding women from employment during recruitment of workers unless the types of work or posts for which workers are being recruited are not suitable for women according to State regulations. Nor shall the standards of recruitment be raised when it comes to women.Article 14 Any special stipulations in-laws and regulations about the employment of the disabled, minority people, and demobilized soldiers shall be observed.Article 15 The employer shall be banned from recruiting juveniles under the age of 16.Art, sports and special-skill units that plan to recruit juveniles under the age of 16 shall go through examination and approval procedures according to relevant State regulations and guarantee the right of the employed to receive compulsory education.Chapter 3 Labour Contracts and Collective ContractsArticle 16 Labour contracts are agreements reached between laborers and the employer to establish labor relationships and specify the rights, interests and obligations of each party.Labour contracts shall be concluded if labor relationships are to be established.Article 17 Conclusion and alteration of labor contracts shall follow the principle of equality, voluntariness, and agreement through consultation. They shall not run counter to stipulations in laws or administrative decrees.Labour contracts shall become legally binding once they are concluded in accordance with the law. The parties involved shall fulfill obligations stipulated in labor contracts.Article 18 The following labor contracts shall be invalid;(1) Labor contracts concluded against laws or administrative decrees; (2) Labour contracts concluded through cheating, threat, or any other means.Invalid labor contracts shall not be legally binding from the very beginning of their conclusion. If a labor contract is confirmed as being partially invalid, the other parts shall be valid if the parts that are invalid do not affect the validity of these other parts.The invalidity of a labor contract shall be confirmed by a labor dispute arbitration committee or a people's court.Article 19 Labour contracts shall be concluded in written form and contain the following clauses:(1) Time limit of the labor contract; (2) Content of work; (3) Labour protection and labor conditions; (4) Labour remunerations; (5) Labour disciplines; (6) Conditions for the termination of the labor contract; (7) Liabilities for violations of the labor contract.Apart from the necessary clauses specified in the preceding clause, the parties involved can include in their labor contracts other contents agreed upon by them through consultation.Article 20 The time limits of labor contracts shall be divided into fixed and flexible time limits and time limits for the completion of a certain amount of work.Labor contracts with flexible time limits shall be concluded between the laborers and the employer if the former request for the conclusion of labor contracts with flexible time limits after working continuously with the employer for more then 10 years and with the agreement between both of the parties involved to prolong their contracts.Article 21 Probation periods can be agreed upon in labor contracts. These probation periods shall not, however, exceed six months at the longest.Article 22 The parties involved in a labor contract can reach agreements in their labor contracts on matters concerning the keeping of the commercial secrets of the employer.Article 23 Labour contracts shall terminate upon the expiration of their time limits or the occurrence of the conditions agreed upon in labor contracts by the parties involved for terminating these contracts.Article 24 Labour contracts can be revoked with the agreement reached between the parties involved through consultation.Article 25 The employer can revoke labor contracts should any one of the following cases occur with its laborers:(1) When they are proved during probation periods to be unqualified for employment; (2) When they seriously violate labor disciplines or the rules or regulations of the employer; (3) When they cause great losses to the employer due to serious dereliction of duties or engagement in malpractices for selfish ends; (4) When they are brought to hold criminal responsibilities in accordance with the law.Article 26 The employer can revoke labor contracts should any one of the following cases occur, with its laborers to be notified, in written form, of such revocation in 30 days' advance:(1) The laborers can neither take up their original jobs nor any other kinds of new jobs assigned by the employer after completion of medical treatment for their illnesses or injuries not suffered during work; (2) The laborers are incompetent at their jobs and remain as so even after training or after readjusting the work posts; (3) No agreements on alteration of labor contracts can be reached through consultation between and by the parties involved when major changes taking place in the objective conditions serving as the basis of the conclusion of these contracts prevent them being implemented.Article 27 In case it becomes a must for the employer to cut down the number of workforce during the period of legal consolidation when it comes to the brink of bankruptcy or when it runs deep into difficulties in business, the employer shall explain the situation to its trade union or all of its employees 30 days in advance, solicit opinions from its trade union or the employees, and report to the labor administrative department before it makes such cuts.If the employer cuts its staff according to stipulations in this Article and then seeks recruits within six months, it shall first recruit those that have been cut.Article 28 The employer shall make economic compensations in accordance with relevant State regulations if it revokes labor contracts according to stipulations in Article 24, Article 26 and Article 27 of this Law.Article 29 The employer shall not revoke labor contracts in accordance with stipulations in Article 26 and Article 27 of this Law should any one of the following cases occur with its laborers:(1) Those who are confirmed to have totally or partially lost their labor ability due to occupational diseases or work-related injuries; (2) Those who are receiving treatment for their diseases or injuries during a prescribed period; (3) Women employees during pregnancy, puerperium, and nursing periods; (4) Others cases stipulated by laws and administrative decrees.Article 30 The trade union shall have the right to air its opinions if it regards as inappropriate the revocation of a labor contract by the employer. If the employer violates laws, regulations or labor contracts, its trade union shall have the right to ask for handling the case anew. If laborers apply for arbitration or raise lawsuits, the trade union shall render support and help in accordance with the law.Article 31 Labourers planning to revoke labor contracts shall give written notice to their employer in 30 days' advance.Article 32 Labourers can notify, at any time, the employer of their decision to revoke labor contracts in any one of the following cases:(1) During their periods of probation; (2) If they are forced to work by the employer through means of violence, threat or deprival of personal freedom in violation of law; (3) Failure on the part of the employer to pay labor remunerations or to provide labor conditions as agreed upon in labor contracts.Article 33 The employees of an enterprise as one party may conclude a collective contract with theenterprise as another party on labor remuneration, work hours, rests and leaves, labor safety and sanitation, insurance, welfare treatment, and other matters.The draft collective contract shall be submitted to the workers' representative assembly or all the employees for discussion and passage.Collective contracts shall be signed by and between the trade union on behalf of the employees and the employer. In an enterprise that has not yet set up a trade union, such contracts shall be signed by and between representatives recommended by workers and the enterprise.Article 34 Labour contracts shall be reported to labor administrative departments after their conclusion. Labour contracts shall take effect automatically if no objections are raised by these labor administrative departments within 15 days after they are received.Article 35 Labour contracts concluded in accordance with law shall be binding on both the enterprise and all of its employees. The standards on labor conditions and labor payments agreed upon in labor contracts concluded between individual laborers and their enterprises shall not be lower than those stipulated in collective contracts.Chapter 4 Working Hours, Rests, and LeavesArticle 36 The State shall practice a working hour system wherein laborers shall work for no more than eight hours a day and no more than 44 hours a week on the average.Article 37 In the case of laborers working on the basis of piecework, the employer shall rationally fix quotas of work and standards of piecework remuneration in accordance with the working hour system stipulated in Article 36 of this Law.Article 38 The employer shall guarantee that its laborers have at least one day off a week.Article 39 If an enterprise can not follow the stipulations in Article 36 and Article 38 of this Law due to special characteristics of its production, it may follow other rules on work and rest with the approval by labor administrative departments.Article 40 The employer shall arrange rests for laborers in accordance with the law during the following holidays:(1) The New Year's Day; (2) The Spring Festival; (3) The International Labour Day; (4) The National Day; (5) Other holidays stipulated by laws and regulations.Article 41 The employer can prolong work hours due to the needs of production or businesses after consultation with its trade union and laborers. The work hours to be prolonged, in general, shall be no longer than one hour a day, or no more than three hours a day if such prolonging is called for due to special reasons and under the condition that the physical health of laborers is guaranteed. The work time to be prolonged shall not exceed, however, 36 hours a month.Article 42 The prolonging of work hours shall not be subject to restrictions of stipulations of Article 41 of this Law in any one of the following cases:(1) Need for emergency treatment during the occurrence of natural disasters, accidents or other reasons that threaten the life, health or property safety of laborers; (2) Need for timely rush-repair of production equipment, transportation lines or public facilities that have gone out of order and as a result affect production and public interests; (3) Other cases stipulated in-laws and administrative decrees.Article 43 The employer shall not prolong the work hours of laborers in violation of the stipulations of this Law.Article 44 The employer shall pay laborers more wage remunerations than those for normal work according to the following standards in any one of the following cases:(1) Wage payments to laborers no less than 150 percent of their wages if the laborers are asked to work longer hours; (2) Wage payments to laborers no less than 200 percent of their wages if no rest can be arranged afterward for the laborers asked to work on days of rest; (3) Wage payments to laborers no less than 300 percent of their wages if the laborers are asked to work on legal holidays.Article 45 The State follows the system of annual leaves with pay.Laborers shall be entitled to annual leaves with pay after working for more than one year continuously. Specific rules on this shall be worked out by the State Council.Chapter 5 WagesArticle 46 Distribution of wages shall follow the principle of distribution according to work and equal pay for equal work.The level of wages shall be raised gradually based on economic development. The State shall exercise macro regulation and control over total payrolls.Article 47 The employer shall fix its form of the wage distribution and wage level on its own and in accordance with this Law according to the characteristics of its production and businesses and economic efficiency.Article 48 The State shall implement a system of guaranteed minimum wages. Specific standards on minimum wages shall be stipulated by provincial, autonomous regional and municipal people's governments and reported to the State Council for registration.The employer shall pay laborers wages no lower than local standards on minimum wages.Article 49 Standards on minimum wages shall be fixed and readjusted with a comprehensive reference to the following factors:(1) The lowest living costs of laborers themselves and the number of family members they support; (2) Average wage level of the society as a whole; (3) Productivity; (4) Situation of employment; (5) Differences between regions in their levels of economic development.Article 50 Wages shall be paid to laborers themselves in the form of currency on a monthly basis. The wages payable to laborers shall not be deducted or delayed without reason.Article 51 The employer shall pay wages to laborers in accordance with the law when they have legal holidays, take leaves during periods of marriage or mourning, and participate in social activities in accordance with the law.Chapter 6 Labour Safety and SanitationArticle 52 The employer shall establish and perfect its system for labor safety and sanitation, strictly abide by State rules and standards on labor safety and sanitation, educate laborers in labor safety and sanitation, prevent accidents in the process of labor, and reduce occupational hazards.Article 53 Labour safety and sanitation facilities shall meet State-fixed standards.The labor safety and sanitation facilities of new projects and projects of renovation and expansion shall be designed, constructed and put into operation and use at the same time as the main projects.Article 54 The employer shall provide laborers with labor safety and sanitation conditions meeting State stipulations and necessary articles of labor protection, and carry out regular health examination for laborers engaged in work with occupational hazards.Article 55 Labourers to be engaged in special operations shall receive specialized training and acquire qualifications for these special operations.Article 56 Labourers should strictly follow rules on safe operation in the process of labor.Laborers shall have the right to refuse to follow orders if the management personnel of the employer directly or force them to work in violation of regulations and to criticize, expose and accuse any acts endangering the safety of their life and physical health.Article 57 The State shall establish a system for the statistical report and treatment of accidents of injuries or deaths and cases of occupational diseases. The labor administrative departments and other relevant departments under the people's governments at or above the county level and the employer shall, in accordance with the law, carry out statistical report and disposition with respect to accidents of injuries or deaths occurred to laborers in the process of their work and situations of occupational diseases.Chapter 7 Special Protection for Female Staff and Workers and Juvenile WorkersArticle 58 The State provides special protection to female staff and workers and juvenile workers. Juvenile workers refer to laborers up to 16 years old but below 18 years old.Article 59 It is forbidden to arrange underground work for women workers at mines, or any labor with Grade IV physical labor intensity as stipulated by the State, or other labor forbidden to women.Article 60 It is forbidden to engage women workers in work high above the ground, under low temperatures, or in cold water during their menstrual periods or labor with Grade III physical labor intensity as stipulated by the State.Article 61 It is forbidden to engage women workers during their pregnancy in work with Grade III physical labor intensity as stipulated by the State or other work the State prevents them from doing during pregnancy. It is forbidden to prolong the work hours of women workers pregnant for seven months or ask them to work night shifts.Article 62 Birth-giving women workers shall be entitled to maternity leaves no shorter than 90 days.Article 63 It is forbidden to engage women workers in work with Grade III physical labor intensity as stipulated by the State during their breastfeeding of babies less than one-year-old and other labor the State prevents them from doing during their breastfeeding periods. Neither shall their work hours be prolonged nor they are asked to work night shifts during these periods.Article 64 It is forbidden to engage underage workers in work under wells at mines, poisonous or harmful work, labor Grade IV physical labor intensity as stipulated by the State, or any other labor the State prevents them from doing.Article 65 The employer shall carry out regular physical examinations for underage workers.Chapter 8 Professional TrainingArticle 66 The State shall promote the cause of professional training through various channels and by various measures to develop the professional skills of laborers, improve their quality, and strengthen their employment and work abilities.Article 67 People's governments at all levels shall include professional training into their programs for social and economic development, and encourage and support enterprises, institutional organizations, social groups, and individuals to carry out professional training in various forms.Article 68 The employer shall establish a system for professional training, extract and use funds for professional training according to State regulations, and provide laborers with professional training in a planned way and according to its specific conditions.Laborers to be engaged in technical work shall receive training before taking up their posts.Article 69 The State shall determine the occupational classification, set up professional skill standards for specific occupations, and practice a system of professional qualification certificates. Examination and appraisal organizations authorized by governments shall be charged to carry out examination and appraisal of the professional skills of laborers.Chapter 9 Social Insurance and Welfare TreatmentArticle 70 The State shall promote the development of the cause of social insurance, establish a social insurance system, and set up social insurance funds so that laborers can receive help and compensation when they become old, suffer diseases or work-related injuries, lose their jobs, and give birth.Article 71 The level of social insurance shall be brought in line with the level of social and economic development and social sustainability.Article 72 The sources of social insurance funds shall be determined according to the categories of insurance, and the practice of unified accumulation of insurance funds shall be introduced. The employer and individual laborers shall participate in social insurance in accordance with the law and pay social insurance costs.Article 73 Labourers shall be entitled to social insurance treatment in any one of the following cases:(1) Retire; (2) Suffer diseases or injuries; (3) Become disabled during work or suffer occupational diseases; (4) Become jobless; (5) Give births.The dependents of the laborer who dies shall enjoy, in accordance with the law, subsidies provided to these dependents.The conditions and standards on the eligibility of laborers for social insurance treatment shall be stipulated by laws and regulations.The social insurance funds for laborers shall be paid in due time and in full.Article 74 organizations charged with the task of handling social insurance funds shall collect, keep and use social insurance funds in accordance with stipulations in-laws, and assume the responsibility to guarantee and multiply the value of these funds.organizations charged to supervise social insurance funds shall supervise in accordance with law stipulations, the collection, keeping and use of social insurance funds.The establishment and functioning of the organizations in the preceding two clauses shall be specified by law.No unit or individuals shall be allowed to use social insurance funds for other purposes.Article 75 The State encourages the employer to set up supplementary insurance for laborers according to its practical conditions.Article 76 The State shall promote the development of the social welfare cause, construct public welfare facilities, and provide conditions for laborers to rest and recuperate and convalesce.The employer shall create conditions to improve collective welfare and provide laborers with better welfare treatment.Chapter 10 Labour DisputesArticle 77 In case of labor disputes between the employer and laborers, the parties concerned can apply for mediation or arbitration, bring the case to courts, or settle them through consultation.The principle of mediation applies to arbitration and court procedures.Article 78 Labour disputes shall be settled according to the principle of justice, fairness, and promptness so as to safeguard the legitimate rights and interests of the parties involved in these disputes in accordance with the law.Article 79 Once a labor dispute occurs, the parties involved can apply to the labor dispute mediation committee of their unit for mediation; if it can not be settled through mediation and one of the parties asks for arbitration, the application can be filed to a labour dispute arbitration committee for arbitration. Anyone of the parties involved in the case can also apply to a labor dispute arbitration committee for arbitration. The party that has objections to the ruling of the labor arbitration committee can bring the case to a people's court.Article 80 A labor dispute mediation committee can be set up inside the employer. This committee shall be composed of workers' representatives, the representatives of the employer, and trade union representatives. The chairmanship of this committee shall be held by a trade union representative.Agreements reached on labor disputes through mediation shall be implemented by the parties involved.Article 81 Labour dispute arbitration committees shall be composed of the representatives of labor administrative departments, representatives from trade unions at the same level, and the employer's representatives. The chairmanship of such a committee shall be held by the representative of a labor administrative department.Article 82 The party that asks for arbitration shall file a written application to a labor dispute arbitration committee within 60 days starting from the date of the occurrence of a labor dispute. Generally speaking, the arbitration committee shall produce a ruling within 60 days after receiving the application. The parties involved shall implement arbitration rulings if they do not have any objections to these rulings.Article 83 If any of the parties involved in a labor dispute has objections to an arbitration ruling, it can raise a lawsuit with a people's court within 15 days after receiving the ruling. If one of the parties involved neither raises a lawsuit nor implements the arbitration ruling within the legal period of time, the other party can apply to a people's court for forced implementation.Article 84 Cases of disputes resulted from the conclusion of collective contracts shall be handled through consultation by all the parties concerned brought together by the labour administrative department of a local people's government if these cases can not be handled through consultation between the parties involved. Cases of disputes resulted from the implementation of collective contracts shall be brought to a labor dispute arbitration committee for arbitration if these cases can not be solved through consultation between the parties involved. The party that has objections to a ruling can raise a lawsuit with a people's court within 15 days after receiving the ruling.Chapter 11 Supervision and InspectionArticle 85 The labor administrative departments under people's governments at or above the county level shall supervise and inspect efforts by the employer to abide by laws and regulations, and have the power to stop any behavior that runs counter to labor laws and regulations and order correction.Article 86 The supervisors and inspectors of the labor administrative departments under people's governments at or above the county level shall have, while performing their public duties, the right to go to the employer to make investigations about the employer's implementation of labor laws and regulations, consult data they deem necessary, and inspect labor spots.The supervisors and inspectors of the labor administrative departments under people's governments at or above the county level shall produce their documents of certification while performing public duties, impartially enforce laws, and abide by relevant regulations.Article 87 Relevant departments under people's governments at or above the county level shall supervise, within the range of their duties and responsibilities, the employer in its observance of labor laws and regulations.Article 88 Trade unions at various levels shall safeguard the legitimate rights and interests of laborers, and supervise the employer in its observance of labor laws and regulations.All units and individuals shall have the right to expose and accuse behaviors that go against labor laws and regulations.Chapter 12 Legal ResponsibilitiesArticle 89 If the rules and regulations on labor formulated by the employer run counter to the provisions of laws and regulations, it shall be given a warning by labor administrative departments, ordered to make corrections, and asked to hold responsibility for harms that may be done to laborers.Article 90 If the employer prolongs work hours in violation of stipulations in this Law, labor administrative departments can give it a warning, order it to make corrections, and may impose a fine thereon.Article 91 The employer involved in any one of the following cases that encroach upon the legitimate rights and interests of laborers shall be ordered by labor administrative departments to pay laborers wage remunerations or to make up for economic losses, and may even order it to pay compensation:(1) Deduction or unjustified delay in paying wages to laborers; (2) Refusal to pay laborers wage remunerations for working longer hours; (3) Payment of wages to laborers below local standards on minimum wages; (4) Failure to provide laborers with economic compensations in accordance with this Law after the revocation of labor contracts.Article 92 The employer whose labor safety facilities and labor sanitation conditions fall short of State regulations or who fails to provide laborers with necessary labor protection articles and labor protection facilities shall be ordered by labor administrative departments or other relevant departments to make corrections or be fined. Those involved in serious cases shall be reported to people's governments at or above the county level so that these people's governments can decide and order it to stop production for consolidation. Criminal responsibilities shall be fixed upon the persons in charge according to stipulations in Article 187 of the Criminal Law should the failure on the part of the employer to take measures against possible accidents to result in serious accidents and cause losses of laborers' life or properties.Article 93 Criminal responsibilities shall be fixed upon the persons in charge in accordance with law if the employer forces laborers to venture to work against regulations and as a result cause major accidents of injuries and deaths and serious consequences.Article 94 The employer that recruits juveniles below the age of 16 in violation of law shall be ordered by labor administrative departments to make corrections, and fined. That which involves in a serious case shall have its business license be revoked by the administration for industry and commerce.Article 95 The employer that encroaches upon the legitimate rights and interests of women and underage workers in violation of the stipulations of this Law on their protection shall be ordered by labor administrative departments to make corrections and fined. That which causes harm to women and underage workers shall assume the responsibility for making compensations.Article 96 The responsible person of the employer involved in any one of the following cases shall be taken by a public security department into custody for 15 days, fined, or given a warning, and criminal responsibilities shall be fixed upon whoever commits a crime:(1) Use of violence, threat or illegal deprival of personal freedom to force labor; (2) Humiliation, corporal punishment, beating, and illegal search or holding of laborers.Article 97 The employer shall assume the responsibility for compensation for losses caused to laborers by the invalidity of contracts due to reasons on the part of the employer.Article 98 The employer that revokes labor contracts or purposely delays the conclusion of labor contracts in violation of the conditions specified in this Law shall be ordered by labor administrative departments to make corrections and assume responsibility for compensation for any losses that may be sustained by laborers therefrom.Article 99 The employer that recruits laborers whose labor contracts have not yet canceled, thus causing economic losses to the former employer, shall assume joint liabilities for compensation according to law.Article 100 The employer that refuses to pay social insurance funds shall be ordered by the labor administrative department to pay within fixed periods of time. That which fails to make payments beyond the prescribed time shall be asked to pay arrears.Article 101 The employer that unjustifiably prevent labor administrative departments and other relevant departments as well as their workers from exercising supervision and inspection powers or retaliates informers shall be fined by labor administrative departments or other relevant departments. If a crime is committed, the person in charge shall be brought to hold criminal responsibilities.Article 102 Labourers who revoke labor contracts in violation of the conditions specified in this Law or violate terms on secret-keeping matters agreed upon in labor contracts shall be asked to hold responsiblity overcompensation in accordance with law if their violation causes economic losses to the employer.Article 103 Criminal responsibilities shall be fixed upon the workers of labor administrative departments or any other relevant departments if they abuse their powers, neglect their duties, and practice fraud for the benefit of relatives or friends to such a degree that they commit crimes. Those who have not committed crimes shall be disciplined administratively.Article 104 Public servants and the workers of organizations charged to handle social insurance funds shall be brought to hold criminal responsibilities if they use social insurance funds for other purposes and as a result commit crimes.Article 105 If other laws or administrative decrees have already specified punishments for encroachment upon the legitimate rights and interests of laborers in violation of the stipulations of this Law, punishments shall be given in accordance with the stipulations of these laws or administrative decrees.Chapter 13 Supplementary ProvisionsArticle 106 People's governments at the provincial, autonomous regional and municipal level shall work out rules on the steps of the implementation of the system of labor contracts according to this Law and their local conditions and report the rules to the State Council for registration.Article 107 This Law shall take effect on January 1, 1995.