Presentation is loading. Please wait.

Presentation is loading. Please wait.

Www.safeecollege.com1 CHAPTER 1B Branch Audit. www.safeecollege.com2 Qualification of Branch Auditor Branch Office In India Outside India If branch is.

Similar presentations


Presentation on theme: "Www.safeecollege.com1 CHAPTER 1B Branch Audit. www.safeecollege.com2 Qualification of Branch Auditor Branch Office In India Outside India If branch is."— Presentation transcript:

1 www.safeecollege.com1 CHAPTER 1B Branch Audit

2 www.safeecollege.com2 Qualification of Branch Auditor Branch Office In India Outside India If branch is situated in India If branch is situated outside following persons are eligible India following persons are to be appointed as branch eligible to be appointed as auditor:- branch auditor:- 1. The company auditor appointed under section 224. 2. Any person qualified to be Appointed as auditor under appointed as auditor under Section 226. 3. Any auditor duly qualified to be appointed as auditor in the country in which branch is situated i.e. foreign auditor.

3 www.safeecollege.com3 Appointment of Branch Auditor Branch auditor is appointed by company in GM. Alternatively shareholders may authorize BOD to appoint branch auditor in consultation with company auditor. Remuneration of Branch Auditor The remuneration of branch auditor is determined by shareholders alternatively they may authorize BOD to fix the remuneration. Powers & Duties of Branch Auditor The branch auditor has same powers and duties in respect of branch accounts as the company auditor has in respect of accounts of company. Powers of Company Auditor Where branch auditor is other than company auditor, company auditor has following rights in respect of branch.  Right to visit branch if he considers it necessary for the performance of his duties.  Right to access books, documents & vouchers at all time i.e. during business hours.

4 www.safeecollege.com4 Report by Branch Auditor The branch auditor should prepare his report according to section 227 including CARO & send his report to the company auditor. (CARO – Companies Audit Report Order) [section 227(4A)] Exemption from Branch Audit [section 228(4)] The CG is empowered to make rules so as to exempt branch offices from audit in certain cases. The CG has framed companies (branch audit exemptions) in following 2 cases:- 1.Exemption based on Quantum of Activity 2.Exemption in Other Cases 1.Exemption based on Quantum of Activity  The branch should be engaged in carrying out PMT activities PMT Processing Manufacturing Trading

5 www.safeecollege.com5  The average quantum of activity of the branch during the relevant financial year does not exceed higher of following two limits:-  Rs. 2 lacks or  2% of total turnover of company including all its branches earnings from service rendered, earnings from other sources.  The company alters should have following rights:-  Right to visit the branch if he considers it necessary for the performance of his duty  Right to access books, accounts & vouchers at all time. Quantum of Activity:- Quantum of activity is defined as higher of the following:-  The aggregate value of goods produced, manufactured or processes.  The aggregate value of goods sold & service rendered.  The amount of expenditure whether capital or revenue incurred by the branches during relevant previous year.

6 www.safeecollege.com6 2.Exemption in other cases Branches may be exempted from audit on any of the following grounds:-  Where branch is not engaged in PMT activities & it has made sufficient arrangements for scrutiny & check of account by a responsible person who is competent to scrutinize &check.  Where branch has made arrangements for audit of branch accounts by a person who is otherwise qualified to be appointed as auditor.  Having regard to nature & quantum of activity carried at the branch, it is not likely that branch auditor would be available at reasonable cost.  CG may grant exemption on any other grounds if it is satisfied that exemption should be granted.


Download ppt "Www.safeecollege.com1 CHAPTER 1B Branch Audit. www.safeecollege.com2 Qualification of Branch Auditor Branch Office In India Outside India If branch is."

Similar presentations


Ads by Google