Checked 29 October 2026. The C-2 syllabus is CAG's revised CPD syllabus. The standards under it are revised by their issuers; for example IPSAS 47 applies to annual financial statements covering periods beginning on or after 1 January 2026. Check the issuer's current text before the exam.
The short answer: C-2, Accounting and Auditing Principles & Standards, is one of the two CPD-I papers (2 hours, 100 marks, 50% to pass, 0.25 marks off for each wrong answer). CAG's syllabus sets out C-2's content under six headings: CAG's Auditing Standards 2017, the international auditing standards issued by IFAC, Ind AS, IGAS, IPSAS and CAG's Guidelines on Data Analytics. Our study advice: because the syllabus is a list of texts, learn the texts precisely, including who issued a standard, what basis of accounting it serves, its definitions, its effective date and which older standard it replaced.
Independent study site, not affiliated with CAG. ProSyllabus is not part of the Comptroller and Auditor General of India, the IA&AD, GASAB, ICAI, IFAC or IPSASB. Our reading of how C-2 can be examined, the area mix of our mocks, the list of confusions and the revision order are our own study advice and are labelled as such.
CAG revised CPD syllabus; CAG's Auditing Standards 2017; GASAB IGAS page, read on 29 October 2026.
What C-2 covers: the six syllabus headings
The revised CPD syllabus words C-2 as "Provisions of" six headings, and for suggested reading it says only "Standards and Guidelines issued by the authorities concerned". No textbook is named. The table puts each heading beside its issuer and, in the last column, our reading of how a multiple-choice paper can test it. The saved CAG texts give no question count for C-2, and the area split of our mocks is our own.
| Syllabus heading | Issued by | Basis or scope | How MCQs can test it (our reading) |
|---|---|---|---|
| CAG's Auditing Standards 2017 | Comptroller and Auditor General of India (March 2017) | Norms applicable to all public sector audit engagements; effective from 1 April 2017 (para 1.2) | Postulates, mandate, types of audit and engagement, assurance levels, opinion types, frameworks |
| International Auditing Standards issued by the IFAC | IFAC, as the syllabus words it; the ISAs we read are in the IAASB 2026 handbook | International Standards on Auditing (ISAs) | Definitions (audit risk, detection risk, performance materiality, key audit matters) and the reporting standards |
| Ind AS notified by the Ministry of Corporate Affairs | Notified by the Ministry of Corporate Affairs | Accrual basis, except for cash flow information (Ind AS 1, para 27) | Definitions, recognition and measurement rules, classification |
| IGAS issued by GASAB | Formulated by GASAB, mandatory after notification by the Ministry of Finance | Cash system of accounting | Notification facts, effective dates, recognition and disclosure rules |
| IPSAS issued by IPSASB | International Public Sector Accounting Standards Board | IPSAS 1 defines the accrual basis; the separate Cash Basis IPSAS covers reporting under the cash basis | Definitions, the components of financial statements, which newer IPSAS superseded which older one |
| Guidelines on Data Analytics issued by CAG | Comptroller and Auditor General of India (September 2017) | The methodology of employing data analytics in the auditing function of IA&AD (para 1.2) | Origin, institutional set-up, the analytic process and the four analytic approaches |
This allocation is our own; it is not a CAG weightage. Our two full mocks follow this mix; the 4-question free sample takes one item each from four of the areas.
CAG's Auditing Standards 2017
These are the department's own standards. The preface records the history: the Auditing Standards were first brought out in 1994, revised in 2002, and the 2017 text is the third edition, released by the CAG in March 2017 and aligned with the fundamental auditing principles of the International Standards of Supreme Audit Institutions. Paragraph 1.2 makes them effective from 1 April 2017: all audit engagements under SAI India's mandate on or after that date are to be conducted in accordance with them.
| Chapter | What is in it |
|---|---|
| 1. Basic Postulates | Introduction (the DPC Act, 1971 and the Regulations on Audit and Accounts, 2007 as the overarching governance framework, para 1.1); purpose and authority (para 1.2); the audit mandate (Articles 149, 151 and 279 of the Constitution, the Sixth Schedule, sections 13 to 21 and 24 of the DPC Act, para 1.3); the prerequisites: independence, accountability and transparency, ethics, quality assurance (para 1.4) |
| 2. General Standards | Public sector auditing and its objectives; the three main types of audit (financial, compliance, performance); the three parties; subject matter, criteria and engagement types; forms and levels of assurance; principles of public sector auditing (general principles and principles related to the audit process) |
| 3. Specific Standards | Specific considerations on how the general standards apply to financial, compliance and performance audits (para 3.1) |
Points to learn precisely (our summaries of the text)
From CAG's Auditing Standards 2017, paragraph by paragraph
- The layers: in exercise of powers under the DPC Act, the CAG framed the Regulations on Audit and Accounts, 2007, the overarching governance framework for both accounting and auditing; the Auditing Standards are the next layer (para 1.1).
- Public sector audits involve at least three parties: the auditor, the responsible party and intended users; the intended user is primarily the Parliament or the Legislature (para 2.3.1).
- Financial audits are always attestation engagements; performance and compliance audits are generally direct reporting engagements (para 2.3.3).
- In reasonable assurance the conclusion is expressed positively; a limited assurance conclusion is expressed in a negative manner ("nothing has come to the auditor's attention...") (para 2.4.2).
- Modified opinions: qualified ("except for") where the auditor disagrees with, or is unable to obtain sufficient and appropriate audit evidence about, certain items which are, or could be, material but not pervasive; adverse when deviations or misstatements are both material and pervasive; disclaimed where the auditor cannot obtain sufficient and appropriate audit evidence due to an uncertainty or scope limitation which is both material and pervasive (para 2.5.2.3).
- IPSASs, IFRSs and the Indian Accounting Standards are named as general purpose frameworks; for a framework on other bases, such as modified accrual or cash basis (e.g. IGAS), a complete set of statements may not include all the listed statements (para 3.2.2).
IGAS 1 to 4: four standards, all on the cash basis
GASAB's IGAS page says the Indian Government Accounting Standards it formulates "are for cash system of accounting and become mandatory from the effective date after their notification by Ministry of Finance, Govt. of India". Four are listed as notified by the Government of India. Each notification states that it is made in exercise of the powers conferred by article 150 of the Constitution, by the President, on the advice of the CAG.
| Standard | Title | Notified | Effective | One rule to remember |
|---|---|---|---|---|
| IGAS 1 | Guarantees given by Governments: Disclosure Requirements | S.O. 2979(E), 20 December 2010 | Financial Statements covering periods beginning on or after 1-4-2010 | When Guarantees are invoked and payments made, the payment is treated as a loan to the beneficiary on whose behalf the Guarantees were given |
| IGAS 2 | Accounting and Classification of Grants-in-aid | S.O. 1113(E), 19 May 2011 | Financial Statements covering periods beginning from 1.4.2011 | The grantor classifies and accounts for grants-in-aid as revenue expenditure irrespective of the purpose for which the grantee is to spend them, except in the cases referred to in paragraph 13 |
| IGAS 3 | Loans and Advances made by Governments | 13 February 2012 | Financial Statements covering periods beginning the 1 April of the year after notification | A loan is recognised as an asset from the date the money is actually disbursed and not from the date of sanction; initial measurement at historical cost |
| IGAS 4 | Prior Period Adjustments | S.O. 1033(E), 2 March 2023 | Financial statement for the periods commencing from 1 April 2023 | Material if the value is equal to or greater than rupees one thousand (₹1,000) |
Our study advice: keep the bases of accounting apart. GASAB says IGAS are for the cash system of accounting; IPSAS 1 defines the accrual basis, and the separate Cash Basis IPSAS covers reporting under the cash basis; Ind AS 1 requires the accrual basis except for cash flow information. An option describing GASAB's IGAS as accrual-basis standards, or making them mandatory on GASAB's approval rather than after notification by the Ministry of Finance, conflicts with GASAB's own page.
Ind AS, IPSAS and IGAS side by side
Our study advice is to learn the three accounting frameworks in one table. The comparison below uses only what each issuer's own text says; a dash means we do not summarise that point here.
| Point | Ind AS | IPSAS | IGAS |
|---|---|---|---|
| Issued or notified by | Notified by the Ministry of Corporate Affairs | IPSASB | Formulated by GASAB, mandatory after notification by the Ministry of Finance |
| Basis | Accrual, except cash flow information (Ind AS 1, para 27) | Accrual basis defined in IPSAS 1 (para 7); the Cash Basis IPSAS for reporting under the cash basis | Cash system of accounting |
| Materiality wording | Information that could reasonably be expected to influence decisions of the primary users of general purpose financial statements (Ind AS 1, para 7) | - | IGAS 4: a prior period adjustment is material if its value is equal to or greater than ₹1,000 |
| Complete set of statements | - | IPSAS 1, para 21: statement of financial position, of financial performance, of changes in net assets/equity, cash flow statement, budget comparison when the approved budget is made public, notes, comparative information | CAG AS 2017 para 3.2.2: under a cash-basis framework such as IGAS, a complete set may not include all the general purpose statements |
| Supersessions and dates to know | - | IPSAS 45 supersedes IPSAS 17 (periods beginning on or after 1 January 2025); IPSAS 47 supersedes IPSAS 9, 11 and 23 (periods beginning on or after 1 January 2026); IPSAS 48 applies to periods beginning on or after 1 January 2026 | IGAS 4 applies from periods commencing 1 April 2023 |
For IPSAS, note the transition wording in the standards themselves: IPSAS 47 says IPSAS 9, IPSAS 11 and IPSAS 23 "remain applicable until IPSAS 47 is applied or becomes effective, whichever is earlier", and IPSAS 45 says the same of IPSAS 17.
The international auditing standards
The syllabus says "International Auditing Standards issued by the IFAC". The International Standards on Auditing (ISAs) we read are in Volume 1 of the IAASB's 2026 handbook. Our study advice is to start with the definitions, because a definition makes a clean single-best-answer question. The table gives what each ISA we used says on the point named.
| ISA | What the text says |
|---|---|
| ISA 200 | Audit risk is a function of the risks of material misstatement and detection risk; reasonable assurance is a high, but not absolute, level of assurance |
| ISA 240 (Revised) | The auditor is to proceed on the presumption that there are risks of material misstatement due to fraud in revenue recognition; the auditor treats the risks of management override of controls as risks of material misstatement due to fraud at the financial statement level and determines whether they affect the assessment at the assertion level; effective for periods beginning on or after 15 December 2026 |
| ISA 315 | A significant risk is an identified risk of material misstatement for which the assessment of inherent risk is close to the upper end of the spectrum of inherent risk, or that is to be treated as a significant risk in accordance with the requirements of other ISAs |
| ISA 320 and ISA 450 | Performance materiality is set at less than materiality for the financial statements as a whole; the auditor accumulates identified misstatements other than those that are clearly trivial |
| ISA 500, 505 and 530 | Reliability of audit evidence depends on its source, nature and circumstances; the steps when management refuses a confirmation request; negative confirmations are less persuasive than positive ones; sampling risk |
| ISA 570 (Revised 2024) | If management's going concern assessment covers less than twelve months from the date of approval of the statements, the auditor requests management to extend it; effective for periods beginning on or after 15 December 2026 |
| ISA 701, 705 and 706 | Key audit matters are those of most significance in the audit of the current period; ISA 705 (Revised) prohibits communicating key audit matters when the auditor disclaims an opinion, unless law or regulation requires it; the definition of pervasive; the Emphasis of Matter paragraph |
CAG's Guidelines on Data Analytics
The guidelines are dated September 2017. In the preface the CAG writes that the Big Data Management Policy, formulated in 2015, envisioned the broad contours of the data analytic framework for the Department.
| Point | What the guidelines say |
|---|---|
| Why they exist | Developed as a follow-up of the Big Data Management Policy issued in September 2015 and subsequent initiatives in data analytics in IA&AD, particularly in audit (para 1.3) |
| Status | Prescriptive, but not intended to supersede the professional judgment of the Accountant General, who is to document the rationale of all significant departures and obtain authorisation from the competent authority (para 1.4) |
| Nodal body | The Centre for Data Management and Analytics (CDMA) is the nodal body for steering data analytic activities in IA&AD (para 1.10) |
| Field offices | The HoD is responsible and constitutes a Data Analytic Group under the charge of a Group Officer; data analytic models are vetted and approved by CDMA |
| The process | Data acquisition, data preparation, data analysis, results and analytic models (para 2.1) |
| Four approaches | Descriptive ("what has happened"), diagnostic ("why did it happen" or "how did it happen"), predictive ("What will happen"), prescriptive (a range of possible actions as inputs so that future outputs can be altered) (para 3.1) |
Confusions to avoid in C-2
Potential confusions in our practice material (our list, each checked against the official text)
- Mixing the layers of CAG's framework: the Regulations on Audit and Accounts, 2007 are the overarching governance framework (CAG AS 2017, para 1.1). The Government Accounting Rules, 1990, General Financial Rules, 2005 and Delegation of Financial Powers Rules, 1978 appear in para 3.2.2 among the rules that govern preparation and compilation of finance and appropriation accounts and "constitute the rule based standards".
- Calling a financial audit a direct reporting engagement. CAG AS 2017 says financial audits are always attestation engagements.
- Swapping "material but not pervasive" (qualified) with "material and pervasive" (adverse or disclaimed).
- Describing IGAS as accrual-basis standards, or as mandatory on GASAB's approval. GASAB says they are for the cash system and become mandatory after notification by the Ministry of Finance.
- Taking an IGAS effective date from the notification date. IGAS 1 applies to periods beginning on or after 1 April 2010 although it was notified on 20 December 2010; IGAS 4 applies from periods commencing 1 April 2023.
- Choosing "the auditor" or "the board" as the reference group for materiality in Ind AS 1. The definition refers to the primary users of general purpose financial statements.
- Quoting superseded IPSAS numbers as current: IPSAS 45 supersedes IPSAS 17, and IPSAS 47 supersedes IPSAS 9, 11 and 23.
Four free C-2 questions with answers
These are the four questions of the free sample in our C-2 mock test, word for word, with the same options in the same order, the answer and the explanation. They are our own questions, written from the official texts; they are not CAG questions. Try each one before reading its answer.
Free sample question 1 of 4 · CAG Auditing Standards 2017
Under CAG's Auditing Standards 2017, which instrument did the CAG frame under the DPC Act to provide the overarching governance framework for both accounting and auditing functions?
- A. Delegation of Financial Powers Rules, 1978
- B. Government Accounting Rules, 1990
- C. General Financial Rules, 2005
- D. Regulations on Audit and Accounts, 2007
Answer: D. Regulations on Audit and Accounts, 2007
Para 1.1: in exercise of powers under the DPC Act, the CAG framed the Regulations on Audit and Accounts, 2007, the overarching governance framework for accounting and auditing; the Auditing Standards are the next layer.
Free sample question 2 of 4 · Ind AS
Under Ind AS 1, information is material if omitting, misstating or obscuring it could reasonably be expected to influence the decisions of whom?
- A. The statutory auditor who reports on the financial statements
- B. The tax authorities who assess the entity's taxable income
- C. The primary users of general purpose financial statements
- D. The board of directors who approve the financial statements
Answer: C. The primary users of general purpose financial statements
The definition of "Material" used in Ind AS 1 refers to decisions that the primary users of general purpose financial statements make on the basis of those statements. Auditors, the board and tax authorities are not the reference group in the definition.
Free sample question 3 of 4 · IGAS
According to GASAB, the Indian Government Accounting Standards (IGAS) it formulates are meant for which system of accounting, and when do they become mandatory?
- A. Accrual system; mandatory from the date on which the GASAB Board approves and releases them
- B. Cash system; mandatory from the date the CAG circulates them to Accountants General
- C. Cash system; mandatory from the effective date after notification by the Ministry of Finance
- D. Accrual system; mandatory from the effective date after notification by the ICAI
Answer: C. Cash system; mandatory from the effective date after notification by the Ministry of Finance
The GASAB IGAS page states that IGASs formulated by GASAB are for the cash system of accounting and become mandatory from the effective date after their notification by the Ministry of Finance, Government of India.
Free sample question 4 of 4 · CAG Data Analytics Guidelines
The CAG's Guidelines on Data Analytics were developed as a follow-up to which earlier policy?
- A. The Performance Auditing Guidelines
- B. The Information Systems Security Handbook
- C. The IT Audit Policy of IA&AD
- D. The Big Data Management Policy of IA&AD
Answer: D. The Big Data Management Policy of IA&AD
Para 1.3: the guidelines have been developed as a follow up of the Big Data Management Policy issued in September 2015 and later initiatives in data analytics in IA&AD.
The two full mocks, 100 questions each in 2 hours with the 0.25 deduction, are on the C-2 mock test page, where the same 4 questions can be played free in the quiz player first. The C-2 revision kit condenses the six syllabus headings into revision notes. For the scheme itself (eligibility, chances, the advance increment and registration), see our CAG CPD exam guide.
A revision order for C-2 (our advice)
Our advice is to read the official texts themselves. The order below is our own: CAG's Auditing Standards first, then the Government standards, the corporate and international standards, and the Data Analytics guidelines last.
| Step | Read | Make a note of |
|---|---|---|
| 1 | CAG's Auditing Standards 2017, Chapters 1 and 2 | The layers of the framework, the mandate articles, the prerequisites, the three parties, engagement types, assurance levels, the opinion types |
| 2 | CAG AS 2017, Chapter 3 (Specific Standards) | Frameworks (para 3.2.2) and the specific considerations for financial, compliance and performance audit |
| 3 | IGAS 1 to 4 and the GASAB IGAS page | Title, notification number and date, effective date and one recognition or disclosure rule for each |
| 4 | Ind AS: start with Ind AS 1, Presentation of Financial Statements, and the other notified Ind AS | Definitions and the recognition test of each |
| 5 | IPSAS 1, the Cash Basis IPSAS, IPSAS 45, 47 and 48 | Which standard supersedes which, and for which periods |
| 6 | The ISAs in the table above | Definitions, word for word |
| 7 | CAG's Guidelines on Data Analytics | Origin, CDMA and Data Analytic Groups, the process, the four approaches |
| 8 | Two timed 2-hour mocks | Every wrong answer, checked against its source paragraph |
Frequently asked questions
What is the syllabus of CPD-I paper C-2?
Provisions of six headings: CAG's Auditing Standards 2017; International Auditing Standards issued by IFAC; Ind AS notified by the Ministry of Corporate Affairs; IGAS issued by GASAB; IPSAS issued by IPSASB; and the Guidelines on Data Analytics issued by CAG. The suggested reading is the standards and guidelines themselves.
How long is the C-2 paper and how many marks does it carry?
Two hours and 100 marks, per CAG's revised CPD syllabus. You need 50% in the paper to pass it, and CAG's exam FAQ says 0.25 marks are deducted for each wrong answer.
How many questions are in the C-2 paper?
CAG does not publish the number. Our mocks use 100 questions of 1 mark each in 2 hours; that is our format.
How many IGAS are notified?
Four, according to GASAB's IGAS page: IGAS 1 (guarantees, notified 20 December 2010), IGAS 2 (grants-in-aid, 19 May 2011), IGAS 3 (loans and advances, 13 February 2012) and IGAS 4 (prior period adjustments, 2 March 2023).
Are IGAS on the cash basis or the accrual basis?
Cash. GASAB says the IGASs it formulates are for the cash system of accounting and become mandatory from the effective date after notification by the Ministry of Finance.
Which edition of CAG's Auditing Standards is in the syllabus?
The 2017 standards, the third edition after 1994 and 2002, effective from 1 April 2017.
Do I need the latest IPSAS changes?
Read the current texts. IPSAS 45 supersedes IPSAS 17 and applies to periods beginning on or after 1 January 2025; IPSAS 47 supersedes IPSAS 9, 11 and 23 and applies to periods beginning on or after 1 January 2026.
Are the four sample questions from a CAG paper?
No. They are our own questions, written from the official texts, and they are the free sample of our C-2 mock test.
More in this series
Sources
- official — CAG: Revised Syllabus of Continuous Professional Development Examinations (C-2 at Stage I) (PDF)
- official — CAG: Continuous Professional Development Examination page
- official — CAG: Exam FAQs (0.25 marks deducted for each wrong answer in departmental CBT exams)
- official — CAG: CAG's Auditing Standards 2017 (third edition, March 2017, effective 1 April 2017)
- official — GASAB: Indian Government Accounting Standards (IGAS) page, with the four standards notified by the Government of India
- official — IGAS 1, Guarantees given by Governments: Disclosure Requirements, Ministry of Finance notification S.O. 2979(E) of 20 December 2010 (PDF)
- official — IGAS 2, Accounting and Classification of Grants-in-aid, notification S.O. 1113(E) of 19 May 2011 (PDF)
- official — IGAS 3, Loans and Advances made by Governments, notification of 13 February 2012 (PDF)
- official — IGAS 4, Prior Period Adjustments, notification S.O. 1033(E) of 2 March 2023 (PDF)
- official — ICAI: Ind AS access, Compendium of Indian Accounting Standards 2025-26 as notified by MCA (Ind AS 1 text)
- official — IPSASB: IPSAS 1, Presentation of Financial Statements (2026 Handbook) (PDF)
- official — IPSASB: Cash Basis IPSAS, Financial Reporting Under the Cash Basis of Accounting (2026 Handbook) (PDF)
- official — IPSASB: IPSAS 45, Property, Plant, and Equipment (2026 Handbook) (PDF)
- official — IPSASB: IPSAS 47, Revenue (2026 Handbook): effective date and the standards it supersedes (PDF)
- official — IPSASB: IPSAS 48, Transfer Expenses (2026 Handbook): effective date (PDF)
- official — IAASB: 2026 Handbook of International Quality Management, Auditing, Review, Sustainability and Other Assurance, and Related Services Pronouncements, Volume 1 (ISAs) (PDF)
- official — CAG: Guidelines on Data Analytics (September 2017) (PDF)
official = a document published by the conducting body. reported = a news or coaching site we could not check against an original. Where sources disagree this page says so rather than picking one.
