Table of Content
- Q 1 : State with reasons whether the following statements are...
- Q 2 (A) : M/s ABC & Associates, statutory auditors of Opaque Ltd.,..
- Q 2 (B) : Strained relationship between management and the...
- Q 2 (C) : The engagement partner shall form a conclusion on...
- Q 2 (D) : As per 11(g) of the Companies (Audit and Auditors)...
- Q 3 (A) : UVW Ltd. a biopharma company and global manufacturers....
- Q 3 (B) : Narrate the audit procedures to be performed by an auditor in...
- Q 3 (C) : Elucidate the impact on substantive audit if IT related risks...
- Q 3 (D) : The nature of related party relationships and transactions may,...
- Q 4 (A) : The auditor’s determination of materiality is a matter of...
- Q 4 (B) : How is “Short Term Borrowings” disclosed in the..
- Q 4 (C) : Discrepancies in the accounting records, including...
- Q 4 (D) : The nature of the comparative information that is...
- Q 5 (A) : You are the senior member of the engagement team of M/s BB ...
- Q 5 (B) : The auditor's report Shal include a section with a heading...
- Q 5 (C) : While conducting the audit of PDP Ltd. for the financial year...
- Q 5 (D) : The auditor shall determine, from the matters communicated...
- Q 6 (A) : CA Z is appointed as the auditor of Chanakya Open University.. OR
- Q 6 (A) : On 1st May 2022, NGO has been founded with the objective....
- Q 6 (B) : Factors that should be considered for deciding upon the..
- Q 6 (C) : An auditing firm should monitor compliance with quality...
- Q 6 (D) : Mention any three expenses which are revenue in nature,but...
Question 1 :
State with reasons whether the following statements are correct or incorrect.
(A) The relationships between individual financial statements items traditionally considered in the audit of business entities may not always be relevant in the audit of governments or other non-business public sector entities.
(B) NGOs registered under the Companies Act, 2013 are not allowed to maintain accounts on cash basis.
(C) Sales invoice is an example of external evidence.
(D) Any casual vacancy in the office of a Cost Auditor, due to resignation, shall be filled in Annual General Meeting within 60 days of occurrence of such vacancy and the company shall inform the central government in Form CRA-2 within 45 days of such appointment of cost auditor.
(E) Under ‘finance lease’ lease term generally extends to less than 75% of the projected useful life of the leased asset.
(F) Block sampling does not involve judgement, does not even use the random number tables and has no structured approach.
(G) In government expenditure audit, audit against provision of funds aims at ensuring that each item of expenditure is covered by sanction, either general or special, of the competent authority.
(H) Internal controls over financial reporting is required where auditors are required to express an opinion on the’ effectiveness of an entity’s internal controls over financial reporting.
Answer 1 :
Question 2 : (A)
M/s ABC & Associates, statutory auditors of Opaque Ltd., are in the process of finalizing the audit report of the company but in View of their inability to obtain sufficient appropriate audit evidence, they would like to disclaim their opinion on the financial statements. Explain reporting responsibilities of M/s ABC & Associates pursuant to SA 700(Revised). How they will address key audit matters section in accordance with SA 701 when they are expressing disclaimer of an opinion on the financial statements ?
Answer 2 : (A)
COMING SOON
Question 2 : (B)
Strained relationship between management and the current or predecessor auditor is one of the risk factors relating to misstatements arisingfrom Fraudulent Financial Reporting. Mention such circumstances.
Answer 2 : (B)
Question 2 : (C)
The engagement partner shall form a conclusion on compliance with independence requirements that apply to an audit engagement. State the relevant requirements as per relevant SA 220- Quality control for an audit of Financial Statements.
Answer 2 : (C)
COMING SOON
Question 2 : (D)
As per 11(g) of the Companies (Audit and Auditors) Rules,2014 auditor’s report should state whether the accounting software used for maintaining its books of account has a feature of recording audit trail (edit log) facility. what are the reporting requrirements under Rule 11(g)?
Answer 2 : (D)
COMING SOON
Question 3 : (A)
UVW Ltd. a biopharma company and global manufacturers of select critical care medical products, has been sanctioned working capital limits of ₹ 5.99 crores from a nationalized bank on the basis of security of current assets, During the year under audit, the statutory auditor of UVW Ltd. considers that inventory is material to the financial statements and performs audit procedures over the company’s final inventory records to determine whether they accurately reflect actual inventory count and without any major discrepancies for each class of inventory. What are the reporting requirements under CARO 2020 in this case ?
Answer 3 : (A)
COMING SOON
Question 3 : (B)
Narrate the audit procedures to be performed by an auditor in order to ascertain that the Raw materials and consumables are valued appropriately and as per generally accepted accounting policies and practices.
Answer 3 : (B)
Question 3 : (C)
Elucidate the impact on substantive audit if IT related risks are not mitigated in an automated environment.
Answer 3 : (C)
Question 3 : (D)
The nature of related party relationships and transactions may, in some circumstances, give rise to higher risks of material misstatement of the financial statements than transactions with unrelated parties. Explain with the help of at least three examples.
Answer 3 : (D)
