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Wednesday, August 22, 2012

Auditing Tips Summary as discussed in the Class

1. Auditing is largely a practical and application discipline

2. For the purpose of its full coverage you may segregate the syllabus of this paper into six parts for preparation

3. In first part you may prepare Engagements and Quality Control Standards on Auditing (SA/SRS/SRE/SAE) and Guidance Notes for which list of applicable standards are published by ICAI on time to time

4. In part two, you may prepare Professional Ethics. Generally it has been observed that there is one question i.e. case studies based question of 16 marks in the examination paper

5. In part three, you may prepare audit strategy, planning and programming, risk assessment and internal control evaluation, audit under computerized information system (CIS) environment

6. In part four, you may incorporate audit of limited companies, rights, duties and liabilities of auditors, third party liability and Audit Committee and corporate governance

7. In part five, you may include miscellaneous audits like audit of banks, insurance companies, co-operative societies, NBFCs, audit under fiscal laws, cost audit and special audit assignments

8. In part six, you should prepare special features in audit of public sector companies, internal audit, management and operational audit, investigation and due diligence and concept of peer review

While answering the case studies based question, answer should be split in to Two parts, first one is Fact of the cases and second one is the relevant concept and finally give your good conclusion in this way the case study and application oriented theory questions can be handled

Thursday, August 2, 2012

Important Topics for Advanced Auditing, May 2013

Important Topics for Advanced Auditing, May 2013
1. Appointment of Auditor by Special Resolution: Material date for 25% holding of subscribed share capital
2. Audit of Branch Accounts and Exemption thereto
3. Appointment of Special Auditor u/s 233A and/ vis-à-vis communication under Clause 8 Part I of First Schedule of Chartered Accountants Act, 1949 (as amended)
4. Audit Strategy (Short Note)
5. Dividends and the related Rules on transfer of profits to reserves
6. Declaration of Dividend in the event of presence of past losses (section 205)
7. Final Dividend vs. Interim Dividend
8. Corporate Form of Practice by CA (Management Consultancy Company, i.e., MCC)
9. New Disciplinary Mechanism (Distinction b/w powers of Board of Discipline and Disciplinary Directorate)
10. Clause 2, 3, 4, 5, 6, 7, 8, 9 and 12 of Part I, First Schedule
11. Clause 7 and Clause 10 of Part I, Second Schedule
12. Part IV and Part III of Schedule First and Schedule Second respectively
13. Council General Guidelines 2008 under Code of Ethics
14. Guidelines for Website by CA
15. Calculation of Turnover u/s 44AB
16. Clause 12A, 17, 17A, 18, 21, 22, 24, 27 and 32 of Form 3CD
17. Audit of Public Trusts
18. True and Fair cost of production
19. Propriety Cost audit
20. Management Audit and its objectives
21. Financial Audit vs. Management Audit vs. Operational Audit vs. Internal Audit
22. Types of Management Audit Reports
23. Practical question on drafting Management Control Questionnaire (MCQ)
24. Audit Trail
25. Approaches to EDP Audit
26. Service Bureau/ BPO (see SA 402)
27. “The objective and scope of audit does not change in CIS environment.” Comment
28. Propriety Audit and its types (specially objective and scope of PSU audit whether different from statutory audit and Section 619 Questionnaire)
29. Propriety elements in CARO
30. Investigation on behalf of Incoming Partner
31. Investigation for Advancing Loan
32. Section 217 requirements for Board of Directors explanation about statutory auditors’ adverse remarks
33. Due Diligence and contents of DDR (Due Diligence Review) Report
34. CARO applicability on Private Limited Companies
35. Clauses of CARO dealing with: (i) End use of Funds and Company Trading in Shares , (ii) Section 301, (iii) Statutory Dues, (iv) Other Dues, (v) Term Loans, (vii) Internal Audit, (viii) Frauds, (ix) Sick Company, (x) Fixed Assets, and (xi) Inventories
36. Classification of Investments by Banks and Non-performing Assets with NPA Exemptions
37. Concurrent Audit, Corporate Debt Restructuring and Credit Card Operations in a Bank
38. AS 11, AS 17 and Banks
39. Donations made by Banks – RBI Requirements
40. NOSTRO and VOSTRO Accounts of Banks
41. Solvency Margin
42. Valuation of Investments by General Insurance Companies
43. Reinsurance, Contents of Management Report for GIC
44. NBFC vs. Banks
45. Classification of NBFC as per new guidelines of RBI
46. Appointment of Auditor in Cooperative Societies and Books of Accounts to be maintained by Society
47. Borrowings and Loans for Cooperative Societies
48. Appropriation of Profits, Overdue Principal and Interest in case of Cooperative Societies
49. Excise Audit 2000
50. Accounting Aspects for Mutual Funds (specially the treatment of Underwriting Commission and Unit Premium Reserve), Contents of Audit Report
51. Whole Chapter on Members of Stock Exchanges, specially Margins, Circuit Breakers, Contract Notes, Types of Market in NEAT system, Limit Orders, Types of books and records, Proprietary Trading (Beneficiary Account) and Pool Trading (Pool Account), Contents of Audit Report
52. SEBI Investigation for question 50 and 51 above
53. New definition of Independent Directors under Clause 49
54. CEO/ CFO certification under Clause 49
55. Whistle Blower Policy under Clause 49
56. Audit Committee
57. Energy Audit and Environmental Audit
58. Peer Review (can a peer reviewer access the clients’ premises and books of accounts, etc.)
59. SOX (Clause 49 known as Indian SOX)
60. Clause 41
61. SA 240, 315, 330, 500 & 501, 620, 580, 299, 520, 530, 570, 560, 540, 510, 710, 505, 700, 705, 720, SRS 4410, 4400, SRE 2400, SAE 3400
62. Drafting of (i) Letter of Engagement and (ii) Management Representation Letter
63. Guidance Notes: Independence of Auditors, Section 227(3)(e) and (f) reporting, Financial Information in Offer Document, Consolidation of Financial Statements (specially the concept of permanent consolidated adjustments and current consolidated adjustments), Revision of Audit Report
64. Auditor’s Right to Lien (Short Note)
65. Auditor’s Right to attend General Meeting (Section 231)
66. Xerox copies of books of accounts vis-à-vis Auditor’s obligations
67. From Company Law: Short Note on XBRL Filing, Buy Back and Deposit Acceptance Rules