The pairs CA students confuse most.

Provision vs Reserve

A provision is a charge against profit made for a known liability whose amount is uncertain. A reserve is an appropriation of profit set aside to strengthen the business. One reduces profit; the other distributes it.

Capital Expenditure vs Revenue Expenditure

Capital expenditure creates or enhances a long-term asset and is capitalised in the balance sheet. Revenue expenditure maintains earning capacity in the current period and is charged to the statement of profit and loss.

Accounting Standards (AS) vs Indian Accounting Standards (Ind AS)

AS are India's earlier, rule-oriented standards applied by entities outside the Ind AS roadmap. Ind AS are converged with IFRS, principle-based, and use fair value far more extensively.

Cash Flow Statement vs Fund Flow Statement

A cash flow statement tracks movements of cash and cash equivalents across operating, investing and financing activities. A fund flow statement tracks changes in working capital between two balance sheet dates.

CGST + SGST vs IGST

CGST and SGST apply together on intra-State supplies, splitting the tax between the Centre and the State. IGST applies as a single levy on inter-State supplies and is later apportioned.

Direct Tax vs Indirect Tax

A direct tax is borne by the person on whom it is levied and cannot be shifted. An indirect tax is collected by one person but its burden is passed on to the final consumer.

TDS vs TCS

TDS is tax deducted by the payer while making a specified payment. TCS is tax collected by the seller from the buyer at the time of sale of specified goods.

Audit vs Review

An audit provides reasonable assurance through extensive procedures and results in a positive opinion. A review provides limited assurance through inquiry and analytical procedures and results in a negative conclusion.

Internal Audit vs Statutory Audit

Internal audit is an internal control function reporting to management or the audit committee. Statutory audit is an independent external examination required by law, reporting to the shareholders.

Vouching vs Verification

Vouching examines documentary evidence supporting transactions recorded in the books. Verification confirms the existence, ownership, valuation and presentation of assets and liabilities at the reporting date.

Shares vs Debentures

A share represents ownership in a company and carries a residual claim. A debenture represents a loan to the company and carries a fixed contractual claim to interest and repayment.

Private Company vs Public Company

A private company restricts the transfer of its shares and cannot invite the public to subscribe. A public company can raise capital from the public and is subject to substantially heavier compliance.