M ODULE 3 A UDITING CA. S RIPRIYA K UMAR Practical/ Article Training

L EARNING O BJECTIVES What is Auditing Types of Audits Compulsory or Voluntary Good Auditor 2

W HAT IS A UDITING ? An Intro.

A UDITING D EFINED 4  Auditing is the independent examination of financial information of any entity, whether profit oriented or not, and irrespective of its size or legal form, when such an examination is conducted with a view to expressing an opinion thereon – ICAI - AAS-1  The term Audit as applied generally refers to Audit of Financial Statements.

A UDITING Auditing is Independent Examination Financial Information Any Entity Opinion Driven 5

T YPES OF A UDITS ? An Intro.

C OMMON T YPES OF A UDITS Generally an audit of financial information Statutory Audits performed to provide comfort on Internal Controls Internal As Mandated under Sec 44 AB of the Income tax Act Tax Audits Audits performed co-terminus with the transaction. Concurrent Forensic, IS Audits, Environmental Audits, Social Audits Other Audits 7

I S A UDIT C OMPULSORY IN I NDIA ?

I S A UDIT C OMPULSORY  Companies Act 2013 makes it compulsory for all Companies to get themselves audited by a Chartered Accountant appointed as an independent auditor  Income Tax mandates compulsory for certain categories of assesses ( eg. Tax Audit under Section 44AB )  Bankers may insist on audited financials for certain categories of borrowers or for proposed advances exceeding a certain threshold

W HAT MAKES A G OOD A UDITOR ?

What makes a Good Auditor ? Confidentiality Objectivity Integrity Independence Personal Reporting Documentation Audit Program Planning Professional The above characteristics highlight a good auditor

W HAT N EXT ? W HAT DO I D O ? Yes, I want to be a Good Auditor