INTERMEDIATE EXAMINATION

DECEMBER 2005
GENERAL AND COMMERCIAL LAWS
Time allowed : 3 hours Maximum marks : 100

Note: Answer SIX questions including Question No.1 which is

COMPULSORY.
Question 1
a "None of the fundamental rights to freedom is absolute." Comment
and explain the reasonable restrictions which can be imposed on the
freedom of speech and expression. 8 marks
b On what grounds and against whom can the writ of certiorari be
issued?
6 marks
c Discuss in brief the rule of colourable legislation. 6 marks
Question 2
a Explain the golden rule of interpretation of statutes. 5 marks
b When does the payment of interest or part-payment of principal
amount by the debtor extend the period of limitation? Discuss. 5
marks
c Discuss the law embodied in the doctrine of feeding the grant by
estoppel under the Transfer of Property Act 1882. 6 marks
Question 3
a State the contracts which can be specifically enforced under the
Specific Relief Act 1963. 5 marks
b How and when a trust can be revoked and extinguished? 5 marks
c Write short notes on the following.
i Doctrine of sufficient cause
ii Actionable claims. 3 marks
Question 4
a Discuss the essential ingredients of an arbitral award. On what
grounds may an award be challenged before the court under the
provisions of the Arbitration and Conciliation Act 1996? 8 marks
b Differentiate between the following in the context of the Code of Civil
Procedure 1908:
i 'Set off' 'counter claim' and 'equitable set off'.
ii 'Reference' 'review' and 'revision'. 4 marks
Question 5
 a Discuss in brief the procedure for formation and registration of a
society under the Societies Registration Act 1860. 5 marks
b Briefly explain the law relating to the place for registering documents
pertaining to land and other documents. 5 marks
c Explain the following terms under the Information Technology Act
2000:
i Digital signatures.
ii Originator.
iii Asymmetric crypto system. 2 marks
Question 6
a Ashok contracts to buy Bhushan's business at the amount to be
determined by two valuers one to be named by Ashok and the other
by Bhushan. Both Ashok and Bhushan name their respective
valuers. Before the valuation is made Ashok instructs his valuer not
to proceed. Can Bhushan specifically enforce this contract? 5
marks
b Arjun executed a power of attorney both in his personal capacity and
in his capacity as an executor trustee manager and liquidator in
favour of Bheem. Decide the liability of duty payable on the
instrument. 5 marks
c Ajay a trustee. of a plot of land worth Rs. 1 lakh though not
authorised by the deed of trust to sell the trust property sells it for
Rs. 2 lakh with the intention to invest the money in a more profitable
manner. Whether the sale by the trustee is valid? Give reasons.
6 marks
Question 7
a Sohan is tried summarily by the metropolitan magistrate on the
charge of committing theft and is sentenced to undergo
imprisonment for a period of four months. Can Sohan challenge the
decision? If so on what grounds?
5 marks
b On the occasion of birthday of Rajat his father Govind gives a plot
of land to him for life and after his death to his wife Sujata for life. He
stipulates that after the death of both Rajat and Sujata their eldest
unborn son will get the property for life. After the death of eldest son
the land will be enjoyed by their younger son absolutely. Decide the
validity of the transfer. 5 marks
c Under what circumstances the opinion of the third person becomes
relevant under the Indian Evidence Act 1872? 6 marks
Question 8
a Rajan a member of the society registered under the Societies
 Registration Act 1860 is in arrears of subscription for the last six
months which he is bound to pay according to the rules. He wants to
attend the special meeting of the society and to vote for a resolution
to be put therein. Advise Rajan.
5 marks
b Amar and Bimal are jointly tried for the murder of Roshan. It is
proved that Amar said " Bimal and I murdered Roshan". Can the
'court consider the effect of this confession as against Bimal? Give
reasons. 5 marks
c Anubhav owes Rs. 10 000 to the partnership firm of Bose and
Chander. Bose dies leaving Chander surviving. Anubhav sues
Chander for a debt of Rs. 15 000 due in his individual capacity. Can
Chander set off the debt of Rs. 10 000? 6 marks
COMPANY ACCOUNTS AND

COST AND MANAGEMENT ACCOUNTING

Time allowed : 3 hours Maximum marks : 100
PART A
Answer Question No. 1 which is COMPULSORY and
any two of the rest from this part
Question 1
Attempt any five of the following:
i Discuss the significance of 'accounting standards'. 4 marks
ii What are the features of 'accounting software' ? 4 marks
iii The paid-up share capital of Foresight Ltd. includes 5 000 9%
redeemable preference shares of Rs.100 repayable at a premium
of 6%. As the shares have become ready for redemption the
company has decided to redeem the entire amount out of the
proceeds of a fresh issue of 50 000 equity shares of Rs.10 at
Rs.10.60 per share. The company realised the entire amount of
equity issue in cash and redeemed the preference shares on date.
You are required to show the journal entries in the books of the
company. 4 marks
iv The following balances appeared in the books of a company on 1st
April 2004:
Rs.
12% Debentures 8 00 000
12% Debenture sinking fund 6 00 000
12% Debenture sinking fund investments
represented by 10% Govt. bonds
secured of Rs. 7 20 000 6 00 000
Annual contributions of Rs. 1 28 000 to sinking fund is to be made
 on 31st March every year. On 31st March 2005 balance at bank was
Rs. 4 00 000 after receipt of interest. The company sold the
investments at 80% and debentures were redeemed. You are
required to prepare - i 12% debentures account; ii debenture
sinking fund account; iii debenture sinking fund investments
account; and iv bank account. 4 marks
v Yash Ltd. has only one type of capital viz. 40 000 equity shares of
Rs. 100 . It also has got reserves totalling Rs. 20 00 000. The
company closes its books on 31st March year. It has paid
dividends @ 12½% upto 2001-02 and 15% thereafter. In 2004-05 the
company suffered a loss of Rs. 2 50 000; therefore it wishes to
draw required amount out of the reserves to pay dividend at 12%.
Advise the company. 4 marks
vi Briefly explain the concept of 'generally accepted accounting
principles' GAAP . 4 marks
Question 2
a Biggie Ltd. made an issue of 10 000 10% mortgage debentures of
Rs.100 at Rs.96. The whole of the issue was underwritten by Smart
Bulls. 8 500 debentures were applied for and allotted to the public.
The underwriters discharged their liability and were paid commission
at the rate of 2% on the nominal value of the debentures. Show the
journal entries.
5 marks
b The summarised balance sheets of P Ltd. and S Ltd. as at 31st March
2005 were as follows:
P Ltd. S Ltd.
Liabilities Rs. Rs.
Share capital:
3 000 shares of Rs.100 3 00 000 -
10 000 shares of Rs.10 - 1 00 000
Capital reserve - 55 000
General reserve 30 000 1 05 000
Profit and loss account 38 200 18 000
Loan from S Ltd. 2 100 -
Bills payable including
Rs.500 to P Ltd. - 1 700
Creditors 17 900 7 000
3 88 200 2 86 700
Assets
Fixed assets 1 50 000 2 44 700
Investments in S Ltd. at cost 1 70 000 -
Stock 40 000 20 000
Loan to P Ltd. - 2 000
 Bills receivable including
Rs.200 from S Ltd. 1 200 -
Debtors 20 000 15 000
Cash 7 000 5 000
3 88 200 2 86 700
There is a contingent liability of Rs.1 000 for bills discounted
appearing in the balance sheet of P Ltd. P Ltd. acquired 8 000 shares
of Rs. 10 in S Ltd. on 31st March. 2005.
You are given the following additional information:
i S Ltd. made a bonus issue on 31st March 2005 of one share for
every two shares held reducing general reserve by an equivalent
amount but the transaction is not shown in the balance sheet.
ii Interest receivable amounting to Rs. 100 in respect of a loan due
by P Ltd. has not been credited in the accounts of S Ltd.
iii The directors decided that the fixed assets of S Ltd. were
overvalued and should be written down by Rs. 5 000.
Prepare a consolidated balance sheet of the two companies as at
31st March 2005 giving all the workings. 10 marks
Question 3
a State the characteristics of 'financial reporting'. 5 marks
b The balance sheet of Super Sound Ltd. as at 31st March 2005 is
given below:
Liabilities Rs. Assets Rs.
Share capital: Buildings 2 25 000
9 000 Equity shares Machinery 3 30 000
of Rs.100 Stock 4 50 000
fully paid-up 9 00 000 Sundry debtors 2 40 000
Profit and loss account75 000 Bank 90
000
Bank overdraft 15 000
Creditors 90 000
Provision for taxation1 65 000
Provision for dividends 90 000
________
13 35 000 13 35 000
The net profits of the company after deducting usual working
expenses but before providing for taxation were as under:
Year Rs.
2002-03 3 00 000
2003-04 3 60 000
2004-05 3 30 000
 On 31st March 2005 building was revalued at Rs. 3 00 000;
machinery at Rs. 3 75 000 and sundry debtors on the same date
include Rs. 10 000 as irrecoverable. Having regard to nature of the
business 10% return on net tangible capital invested is considered
reasonable.
You are required to value the company's share ex-dividend.
Valuation of goodwill may be based on three years purchase of
annual super profits. Rate of depreciation on buildings is 2% and on
machinery is 10%. The income-tax rate is to be assumed at 35%. All
workings should form part of your answer. 10 marks
Question 4
a The balance sheet of Sugandh Ltd. as at 31st December 2004 is as
follows:
Liabilities Rs. Assets Rs.
5 000 6.5% Preference Patents 49 000
shares of Rs. 20 Buildings 1 20 000
fully paid-up 1 00 000 Debtors 24 000
6 000 Equity shares of Stock 36 000
Rs.20 fully Cash balance 1 000
paid-up 1 20 000 Profit and loss a/c 30 000
5% Debentures20 000
Add: Interest 4 00024 000
Creditors 16 000 _______
2 60 000 2 60 000
The following scheme was passed and sanctioned:
i Future Ltd. to be formed to take over the business.
ii One share of Rs. 10 fully paid-up in the new company to be issued
for every three equity shares in the old company.
iii Three shares of Rs. 10 fully paid-up in the new company to be
issued for every five preference shares in the old company.
iv Debentureholders to be paid in full by Future Ltd.
v The creditors to receive 80% of the sums due to them in fully paid-
up shares of Rs. 10 in the new company in full settlement.
vi Patents and profit and loss to be written off.
vii Arrears of preference dividend to be cleared by issuing one equity
share of Rs. 10 fully paid-up in Future Ltd. for every 20 shares
held.
viii Any balance available by the scheme to be used in writing down
buildings.
You are required to pass the journal entries and prepare a balance
sheet of Future Ltd. after giving effect to the scheme. 10 marks
 b From the following information calculate the amount of provision to
be made in the profit and loss account of Trusted Bank Ltd. for the
year 2004-05:
Rs. in '000
Standard assets 5 96 520
Sub-standard assets 37 120
Doubtful assets:
Upto one year secured 10 264
One year to three years secured 6 240
More than three years secured by mortgage
of plant worth Rs.1 600 thousand 2 632
Loss assets 4 136
5 marks

PART B
Answer Question No. 5 which is COMPULSORY and
any two of the rest from this part
Question 5
Attempt any four of the following:
i Explain the complementary role of financial accounting and cost
accounting.
5 marks
ii A manufacturing company has three production departments and
two service departments. The summary of departmental expenses
are distributed as under:
Rs. Rs.
Production Deptt.
P1 32 000
P2 26 000
P3 28 000 86 000
Service Deptt.
S1 9 360
S2 12 000 21 360
The service department expenses are charged on the following
percentage basis:
Production Deptt. Service Deptt.
Service Deptt. P1 P2 P3 S1 S2
S1 20% 25% 35% - 20%
S2 25% 25% 40% 10% -
Prepare a statement showing the apportionment of expenses of two
service departments in production departments by simultaneous
 equation method.
5 marks
iii Explain the significance of 'break-even analysis'. 5 marks
iv Using the following data compute - i closing inventory; and ii
cost of sales under 'current purchasing power' CPP method
assuming that the firm is following last-in-first-out LIFO method of
inventory valuation:
Rs.
Inventory as on 1st January 2004 2 40 000
Purchases during 2004 14 40 000
Inventory as on 31st December 2004 3 60 000
Price index as on 1st January 2004: 100.
Price index as on 31st December 2004: 130.
Average price index for 2004: 120. 5 marks
v Following are the labour turnover rates computed under different
methods for the quarter ended on 31st March 2005:
Flux method 20%
Replacement method 10%
Separation method 6%
The total number of workers replaced during the quarter is 80.
You are required to find the number of -
i workers left and discharged; and
ii workers recruited and joined including replacements. 5 marks
Question 6
A chemical process yields the following products out of materials
introduced in the process:
% of Material
Main Product-A 60
By-product-B 15
By-product-C 20
Wastage 5
Following additional information has been given to you:
i Total cost incurred:
Input 1 000 units Rs. 4 600
Direct labour Rs. 4 100
Overheads Rs. 6 000
ii One unit of Product-C requires half the raw material required for one
unit of Product-B; one unit of Product-A requires one and half times
the raw material required for Product-B.
iii Product-A requires double the time needed for the production of one
unit of Product-B and one unit of Product-C.
 iv Product-C requires half the time required for production of one unit
of Product-B.
v Overheads are to be absorbed in the ratio of 6:1:1.
You are required to calculate the total and per unit cost of of the
products.
15 marks
Question 7
a Define 'budget key factor'. List four principal budget factors which
may influence the targets. 5 marks
b The following information is available from the records of Always
First Ltd. for a particular week with regard to the composition and
rates of a gang of workmen:
Standard Standard
Composition Hourly Rate
Rs.
20 Skilled workmen 12.00
15 Semi-skilled workmen 10.00
5 Unskilled workmen 8.00
The standard output for a week is 3 600 units and a week consists of
48 hours.
During a particular week a gang consisted of 25 skilled workmen
12 semi-skilled workmen and 3 unskilled workmen and the actual
wages paid were as follows:
Skilled workmen -@ Rs. 11.60 per hour; semi-skilled workmen @ Rs.
10.20 per hour; and unskilled workmen @ Rs. 8.00 per hour.
Actual output during the week was 3 750 units despite the fact that 6
hours were lost in that week due to abnormal idle time.
Based on the above information you are required to work out -
i Labour rate variance;
ii Labour mix variance;
iii Labour idle time variance;
iv Labour yield variance;
v Labour efficiency variance; and
vi Labour cost variance. 10 marks
Question 8
a You are given the following figures worked out from the profit and
loss account and balance sheet of Steadfast Ltd. relating to the year
2004-05. Prepare a balance sheet:

Fixed assets net after writing off 30% Rs. 10 50

000
Fixed assets turnover ratio cost of sales basis 2
Finished goods turnover ratio 6
 Rate of gross profit to sales 25%
Net profit before interest to sales 16%
Fixed charges cover debenture interest 14% 8
Debt collection period 1-1/2 months
Materials consumed to sales 30%
Stock of raw materials in terms of number of months'
consumption 3
Current ratio 2.4
Quick ratio 1.0
Reserves to capital 0.21
9 marks
b The following information is available from the books of Exclusive
Ltd. for the year ended 31st March 2005:
i Cash sales for the year were Rs. 10 00 000 and sales on
account Rs. 12 00 000.
ii Payments on accounts payable for inventory totalled Rs. 7 80
000.
iii Collection against accounts receivable were Rs. 7 60 000.
iv Rent paid in cash Rs. 2 20 000 outstanding rent being Rs. 20
000.
v 4 00 000 Equity shares of Rs.10 par value were issued for Rs. 48
00 000.
vi Equipment was purchased for cash Rs. 16 80 000.
vii Dividend amounting to Rs. 10 00 000 was declared but yet to be
paid.
viii Rs. 4 00 000 of dividends declared in the previous year were paid.
ix An equipment having a book value of Rs. 1 60 000 was
sold for Rs. 2 40 000.
x The cash account was increased by Rs. 37 20 000.
Prepare a cash flow statement using direct method. 6 marks
TAX LAWS
Time allowed : 3 hours Maximum marks : 100
PART A
Answer Question No. 1 which is COMPULSORY and
any three of the rest from this part
Question 1
a Discuss the allowability or otherwise of the following in the hands of
Rasikbhai who is aged about 67 years:
i He paid insurance premium of Rs. 18 000 Rs. 16 000 by cheque
and Rs. 2 000 by cash under Mediclaim Policy to New India
 Insurance Company covering himself and his wife.
ii He spent a sum of Rs. 55 000 during September 2004 towards
medical treatment of his wife who suffered from blindness.
iii His younger brother who is fully dependent on him suffered from
chronic renal failure for which he spent a sum of Rs. 75 000
towards medical treatment.
b Kajol working in a software company at Bangalore is drawing a
remuneration of Rs. 23 000 per month. She is paid D.A. of Rs. 7 000
per month as provided in the terms of employment. In addition she
is also paid HRA of Rs. 5 000 per month and is entitled to 3%
commission on turnover of Rs. 18 00 000 achieved by her during
2004-05. She pays a rent of Rs. 7 200 per month. Further she
received advance salary of Rs. 46 000 in March 2005 relating to the
period April-May 2005. Determine the taxable income under the
head 'salaries'.
c Briefly explain the provisions relating to tax rebate available in the
case of securities transactions tax under the Income-tax Act 1961.
d Explain briefly the scope of the term 'capital asset' as defined
under Section 2 14 of the Income-tax Act 1961.
e State the provisions of the Income-tax Act 1961 for claiming the
interest on the delayed refunds and also indicate the method of
calculation of interest thereon. 3 marks
Question 2
a State with reasons in brief whether the following
receipts/expenses are capital or revenue in nature:
i Ankit Ltd. received Rs. 3 lakh as compensation from Bhushan Ltd.
for premature termination of a contract of agency.
ii Sales tax collected from the buyer of goods.
iii Pretty Ltd. instead of receiving royalty year by year received it in
advance in lump sum.
iv Payment of Rs. 60 000 as compensation for cancellation of a
contract for the purchase of machinery with a view to avoid an
unnecessary expenditure.
v An employee director of a company was paid Rs. 1.5 lakh as a
lump sum consideration for not resigning from the directorship.
5 marks
b When and how tax is to be deducted at source on the income from
winnings from lotteries or crossword puzzles under Section 194B of
the Income-tax Act 1961? 5 marks
c Pritish who owns 9 acres of land near Chennai since July 1985
purchased for Rs. 12 lakh commenced real estate business from
April 1999 and introduced this land as his capital. Fair market value
 of the land on the date of commencement of the business was Rs. 65
lakh. However the value of such land has been recorded at Rs. 80
lakh in the books of business. The entire land after development and
conversion into housing plots was sold for Rs. 135 lakh between
September 2004 and February 2005. Expenses incurred for project
development were Rs. 37 lakh. Advise him as to the taxability of
income and under what heads and in which assessment years.
Note: Cost Inflation Index for year-
1985-1986 : 133
1999-2000 : 389
2004-2005 : 480 5 marks
Question 3
a A group of 10 persons intends to establish a charitable trust and
seeks your advice as to the conditions to be fulfilled for availing the
benefits contemplated under Sections 11 and 12 of the Income-tax
Act 1961. Specify such conditions. 5 marks
b What are the pre-conditions to be fulfilled for exercising revisionary
powers by the Commissioner of Income-tax under Section 263 of the
Income-tax Act 1961 ? Can he revise an order without affording an
opportunity to the assessee ? What is the time limit to exercise such
powers ? Briefly explain.
5 marks
c Discuss the mode of taxation of arrears of rent under Section 25B of
the Income-tax Act 1961. 5 marks
Question 4
a An industrial undertaking which commenced the manufacturing
activity with effect from 1st September 2004 has acquired the
following assets during the previous year 2004-05:

Assets Date of Date when Cost of

Acquisition put to use Acquisition
Rs.
Factory buildings 4.4.2004 1.9.2004 50 00 000
Plant and machinery:
Air pollution control equipment4.5.20041.9.2004 4 00 000
Machinery-A 5.5.2004 1.9.2004 2 00 000
Machinery-B 7.6.2004 1.9.2004 5 00 000
Machinery-C 30.8.2004 1.9.2004 10 00 000
Machinery-D 1.9.2004 31.10.2004 4 00 000
Machinery-E 1.1.2005 28.2.2005 3 00 000
Machinery-F
second hand 11.1.2005 13.1.2005 2 00 000
Motor car 1.2.2005 1.2.2005 5 00 000
 Air-conditioner
installed in the Office 1.2.2005 2.2.2005 1 00 000
Compute the depreciation allowable for the assessment year 2005-06
and the written down value as on 1st April 2005. 8 marks
b Explain the income-tax implications of converting self-acquired
assets into the property of a Hindu Undivided Family HUF .
Illustrate. 4 marks
c "Income of the previous year is assessable as the income of
immediate following financial year." State the exceptions to this rule.
3 marks
Question 5
a Hi-Fi-Home Ltd. a company carrying on business of construction
and sale of residential flats furnishes the following data:
Market Value Rs.
i Land in rural area it is within 5 kilometers of Ajmer;
construction is permissible; land was purchased in 1988 92
78 600
ii Land in urban area construction not permitted
as per municipal laws 23 00 000
iii Land in urban area {held as stock-in-trade
Since 1995 construction will commence
during January 2006 49 50 000
iv Motor cars 11 30 000
v Jewellery 18 00 000
vi Air craft for use of directors and auditors1 58 00 000
vii Bank balance 3 10 000
viii Cash in hand as per cash book 1 70 000
ix Guest house and land appurtenant thereto
situated in rural area 8 00 000
x Residential flats of identical size provided to
6 Employees for their use near factory which
is situated in rural area salary of two
of them exceed Rs. 5 00 000 per annum 15 00 000
xi Residential house provided to the
managing director salary exceeds
Rs. 5 00 000 per annum 10 00 000 xii
Flats constructed and remaining unsold not
being held as stock-in-trade 30 00 000
The company has taken a loan of Rs. 6 00 000 for acquiring
jewellery. You are required to compute its net wealth and determine
the tax payable for the assessment year 2005-06. 10 marks
b Discuss the powers of the Settlement Commission to grant immunity
from prosecution and penalty under Section 245H of the Income-tax
 Act 1961. Under what circumstances can the immunity granted be
withdrawn? 5 marks
PART B
Answer ANY TWO questions from this part
Question 6
a "On arrival every vessel has to seek permission from customs
authorities for its entry for unloading of cargo and loading of export
goods." In the light of this statement discuss the procedure for
seeking such permission from the customs authorities. 10 marks
b Briefly explain the concept of 'transaction value' under Section 4 of
the Central Excise Act 1944. What are the requirements to be
satisfied for applicability of transaction value in a given case? 10
marks
Question 7
a Explain the concept of 'entry' with reference to the provisions of the
Customs Act 1962 and outline the significance of i bill of entry;
arid ii shipping bill.
5 marks
b When shall a sale or purchase of goods be deemed to take place in
the course of export or import? What is the position of last sale or
purchase of goods preceding the sale or purchase occasioning the
export or import ?
5 marks
c In the light of the provisions of the Central Excise Act 1944
examine the correctness or otherwise of the proposition that the
goods must be movable and need not be marketable for the purpose
of levy of excise duty. Also state the essential requirements of goods
to be excisable. 10 marks
Question 8
a What is the procedure for removal of goods on invoice under the
central excise law ? 5 marks
b Write a note on 'safeguard duty' under the Customs Act 1962. 5
marks
c "Value added tax VAT system removes the cascading effect of
taxes." Elucidate. 10 marks
OR
Discuss the following with reference to the provisions of the Central
Sales Tax Act 1956:
i Crossing the customs frontiers of India.
ii How does a dealer discharge the burden of proof that he is not liable
to tax in the course of inter-State sale? 5 marks
 MANAGEMENT INFORMATION SYSTEMS AND

CORPORATE COMMUNICATION
Time allowed : 3 hours Maximum marks : 100
PART A
Answer Question No. 1 which is COMPULSORY and
any two of the rest from this part
Question 1
a Immuno Ltd. is a multinational pharmaceutical company. It has sales
offices in most of the large cities in the world and production plants
in Europe Asia and North America. In order to maintain its
competitiveness Immuno Ltd. made a strategic decision three years
ago to develop a data warehouse to address the organisation's need
for timely and accurate information.
The data warehouse has been under development for two years.
Although users have seen small portions of the new system during
prototyping nothing substantial has been delivered. The response
from the IT department is that due to the complexity of the operation
which is further complicated by its diverse international operations
a fully developed data warehouse will not be ready for quite
sometime. Management and staff are becoming frustrated and
impatient feeling there is an urgent need for a quicker solution.
i Explain how a data warehouse differs from a typical corporate
relational database. 6 marks
ii Suresh a business analyst for the project is often caught
between anxious users and the technical staff because of the
delay. He has heard that data marts can be a solution for this kind
of dilemma. However he is not familiar with the concept of data
marts.
- Explain what a data mart is.
- Could a data mart be a solution to the frustration of waiting ?
- Should Immuno Ltd. replace its data warehouse project with
data marts ?
Give reasons for your answer. 6 marks
b Gogetter Company is interested to install an information system to
facilitate electronic data interchange EDI with its customers and
suppliers. As its Information Technologist you are required to
suggest whether to develop or purchase an EDI translator. List the
factors to trade off between developing and purchasing an EDI
translator. 8 marks
OR
In a meeting of the Board of directors of a bank held in June 2005
Ajoy a nominee of Reserve Bank India on the Board insists that
 before taking any decision about one-time settlement compromising
a bad loan portfolio he should be provided with details of the said
account from day-one. That particular account was good account
till 2003 and had become NPA only in the first quarter of 2004. The
account was operational with the bank for the last 15 years. Credit
officers find it very difficult and time consuming to collect the
desired information and collate documents of last 15 years.
What kind of MIS is desirable which would avoid any conflict
between the Board of directors and executives ? Support your
answer. 8 marks
Question 2
a Distinguish between the following :
i 'Secure HTTP' and 'secure electronic transactions'
ii 'Circuit switching* and 'packet switching'.
iii 'Multimedia PC Level-1 specifications' and 'Multimedia PC Level-2
specifications'. 3 marks
b "DSS are more targeted than MIS." Comment. 3 marks
c "Expert system is a knowledge intensive computer programme yet
it is not devoid of limitations." Do you agree ? Why ? 3 marks
Question 3
a There are various types of information systems in organisations. For
the following scenarios identify the type of information system
being used and explain why that type of information system is being
used. Attempt any three :
i Alok is using a spreadsheet to help him model the financial
implications of a new merger that his company is considering.
Alok is a financial analyst and has been using spreadsheet models
to assess potential mergers for a number of years.
ii Biren is a clerk in the accounts payable department. His task is to
ensure that all daily transactions are processed correctly. He uses
his information system to enter transactions and check that they
have been entered properly so that further accounts payable
processing can be conducted.
iii Gauri is a senior vice-president for marketing in a large consumer
products company. She must continually monitor sales in the
major product categories and make decisions about marketing
campaigns sales force allocations and other marketing activities
related to the sales figures. Her system allows her to monitor sales
up-to-the-minute and 'drill down' to see what factors are affecting
those sales.
iv Dimple is a consumer loan analyst for a large bank. Her job is to
assess consumer loan applications and approve or reject those
applications. The information system she uses asks her a number
 of questions about the loan application which Dimple answers by
typing in answers from the client's application form. The system
then makes a recommendation for approval or rejection based on
the data entered and the rules embedded in the system. The
system then provides Dimple with an explanation of its reasoning.
Dimple can either agree with the system's recommendation or
overrule it. 4 marks
b Briefly explain any three of the following concepts:
i Global village
ii WAN
iii B2C
iv JAVA. 1 mark
Question 4
a List out the misconceptions and myths about 'management
information system' MIS . 3 marks
b Write short notes on any four of the following :
i New interface technologies
ii Asynchronous Transmission Mode ATM
iii Interactive video
iv Switched multi-mega bit data services SMDS
v Modes of e-commerce. 3 marks

PART B
Answer Question No. 5 which is COMPULSORY and
any two of the rest from this part
Question 5
You own a consultancy company that specialises in providing
integrated business solutions. Recently you received a call from Nick
an old college friend of yours who is the manager of the production
department of a baking company Healthy Choice Corporation HCC .
He is asking for your advice regarding some problems that HCC is
facing after a recent business re-engineering and restructuring.
Company History:
HCC has two product lines - organic baked products and regular baked
goods. HCC was one of the first companies to identify the niche market
for organic bakery products. Now it owns the largest share of the
market for organic baked products in its province. It supplies nearly
80% of the supermarkets restaurant chains and small specialty stores.
It also has approximately 25% of the market share for regular baked
products.
Although HCC has a healthy market share in the industry Nick
indicated that the company has been operating close to the break-even-
point in recent years. Many factors have contributed to HCC's inability
to sustain its profitability. Some of the reasons are increasing
competition in the industry as more and more companies have
introduced health food products; increasing costs of energy and raw
materials; and inefficient operations at HCC.
HCC started as a family owned company. To this day most of the mid-
level managers and supervisors are people who joined the company
when it was first established. The company culture has been dominated
by the belief in 'making baked goods in old-fashioned way'. Its
managerial style also reflects a belief in doing things the traditional way.
Organisational Problems:
According to Nick the outdated production processes and inefficient
management proved to be detrimental to HCC's competitiveness. For
example HCC had the opportunity to bid for a new customer with large
orders. When Nick asked the accounting department what the lowest
cost would be to produce the required products the answer was
unclear because the record keeping was incomplete and not up-to-date.
In addition to lacking up-to-date information Nick was also spending
much of his time simply verifying production orders which were
carbon copies of the sales orders sent to him from the marketing
department. He also spent a lot of time tracking down the ordering and
management of the raw materials. Sometimes he had to stop the
production lines to wait for the arrival of a particular ingredient. In order
to improve operations HCC hired a new Chief Executive Officer CEO
who contracted with a business consultant to launch a business re-
engineering process. The objective was to streamline the production
and business processes and to restructure the organisation. The CEO
asked the consultant to recommend an enterprise system to support the
new business processes.
The consultant recommended a turnkey system that would integrate the
business processes from sales to production to inventory
management and accounting. The system also had some customer
relationship management functionalities and EDI capability. Managers
of all departments were informed of the mandate for.change. However
to save time there was little mid-level management and end-user
involvement during the process.
As a result of the re-engineering several mid-level managers' positions
were eliminated. Many job descriptions were changed. For example
Nick's quality control information used to be written manually on a
worksheet by the inspector and input by data entry clerk into a
spreadsheet which was in turn analysed by a production analyst. With
the new system the quality control data are captured electronically at
 the point of inspection. Standard reports are generated automatically
while exceptions are flagged for Nick's attention. However instead of
viewing this streamlined operation as more efficient most employees
believe that the re-engineering was simply a way to downsize and
eliminate their jobs.
It has been one year since the new enterprise system went live. HCC
has not seen the promised improvement in bottom-line from more
efficient operations. Instead it is experiencing tremendous resistance
from the employees. Morale is at an all-time low and the family-like
atmosphere and culture have disappeared. The new turnkey system
does not resemble the way business was conducted at HOC. People feel
insecure about their jobs and uncertain about the new tasks assigned to
them.
Recognising your expertise in the area of business process re-
engineering and implementing enterprise systems Nick has asked you
to prepare a report outlining the current problems faced by HCC and the
possible actions to be taken to amend the situation.
Prepare a report for the HCC in the following format:
i Introduction and executive summary
ii Problem identification
iii Alternatives and analysis
iv Recommendations and conclusions. 5 marks
Question 6
a "The knowledge and practice of SWOT analysis and force field
analysis help both at individual level to emerge as a' better human
being and also at corporate level to be a winner all the time by
reducing uncertainties and risks." Discuss. 8 marks
b "Meetings cannot be effective without an agenda." In the light of this
statement you are required to give guidelines for making an agenda
for a meeting. 5 marks
c Explain why silence is considered as a method of communication.
2 marks
Question 7
State with reasons whether the following statements are true or false :
i "Employees' unresolved problems whether home or work related
cost industry crores of rupees every year in absenteeism lost
productivity and decreased efficiency."
ii "Strategic corporate advertising has a measurable positive influence
on public opinion about the company and is called general
promotion advertising.''
iii "Non-directive counselling will not contribute to the quality of inter-
personal relations and organisational effectiveness because the
 manager will not be able to help the other person in solving his or
her own problem."
iv "Though their education has emphasized verbal communication and
neglected the non-verbal aspect all people effectively use body
language."
v "Persuasion is gentler than influencing." 3 marks
Question 8
a State any three benefits of counselling. 3 marks
b Write short notes on any three of the following :
i Fishbone analysis
ii SOLAADS method of preparing press release
iii Cognitive tendency
iv Ansoff matrix. 3 marks
c Define any three of the following :
i Transactional analysis
ii Micro editing
iii Cover letter
iv Road shows. 1 mark