6 asv stock audit 1112

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Stock AuditStock Audit

ByByCA. Rajkumar S AdukiaCA. Rajkumar S Adukia

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Meaning of StockMeaning of Stock

According to AS -2 Valuation of Inventories, According to AS -2 Valuation of Inventories, stock or inventory is defined as followsstock or inventory is defined as follows

““Inventories are assets:Inventories are assets: (a) held for sale in the ordinary (a) held for sale in the ordinary

course of business;course of business; (b) in the process of production for (b) in the process of production for

such sale; orsuch sale; or (c) in the form of materials or (c) in the form of materials or

supplies to be consumed insupplies to be consumed inthe production process or in the the production process or in the

rendering of services.”rendering of services.”


Meaning of StockMeaning of Stock

Inventories thus normally comprises of Inventories thus normally comprises of stores,stores, spares parts,spares parts, loose tools,loose tools, maintenance supplies,maintenance supplies, raw materials including components,raw materials including components, work in process,work in process, finished goods including by-products,finished goods including by-products, waste or by-products, etc.waste or by-products, etc.


Meaning of DebtorsMeaning of Debtors

A debtor represent the amount due to A debtor represent the amount due to an entity an entity

for goods sold or for goods sold or a service rendered or a service rendered or in respect of other similar contractual in respect of other similar contractual

obligations obligations

but amount includes such amounts but amount includes such amounts which are in the nature of loans and which are in the nature of loans and advances advances


Inventory & ReceivablesInventory & Receivables

Maintenance of inventory is a Maintenance of inventory is a major major part of working capital part of working capital requirementrequirement of any unit. of any unit.

Essential componentsEssential components, of the total , of the total assets of an entity in general and assets of an entity in general and current assets in particular are current assets in particular are Inventories and Debtors. Inventories and Debtors.

Stock and Debtors indicate the Stock and Debtors indicate the health of a companyhealth of a company


Valuation of InventoriesValuation of Inventories

Different methods of valuation are Different methods of valuation are adopted, depending upon the type of adopted, depending upon the type of Inventories, in particular and the type of Inventories, in particular and the type of the business in general. the business in general.

The Inventories should be valued at cost The Inventories should be valued at cost or market price, whichever is lower.or market price, whichever is lower.

The fundamental concept is that provision The fundamental concept is that provision for losses should be made and unrealized for losses should be made and unrealized profits should not be considered profits should not be considered


Method of ValuationMethod of Valuation

The Institute of Chartered Accountants has The Institute of Chartered Accountants has prescribed the methods that are prescribed the methods that are mandatory for the valuation of inventories, mandatory for the valuation of inventories, by means of the Accounting Standard – 2, by means of the Accounting Standard – 2, which deals with the valuation of which deals with the valuation of inventories. inventories.

These methods are Specific Identification These methods are Specific Identification method, First-in-First-out method and method, First-in-First-out method and Weighted Average Method. Weighted Average Method.


Valuation of Different Types of Valuation of Different Types of InventoriesInventories

The Institute of Chartered Accountants of The Institute of Chartered Accountants of India defines, Inventories to include, India defines, Inventories to include, stores, spare parts, loose tools, raw stores, spare parts, loose tools, raw materials, materials in process, finished materials, materials in process, finished products, waste or by products, etc products, waste or by products, etc

Each type of Inventories entails different Each type of Inventories entails different methods of valuation depending on their methods of valuation depending on their unique characteristics. unique characteristics.


Valuation of Different Types of Valuation of Different Types of InventoriesInventories

For computing accumulation of huge inventories the number of days For computing accumulation of huge inventories the number of days holding of Inventories etc, the following method may be followed:holding of Inventories etc, the following method may be followed:• For Raw Material:For Raw Material:

= = Actual Holding_ X 365 ____ Actual Holding_ X 365 ____ Annual Raw Material ConsumedAnnual Raw Material Consumed

• For Inventories in Process:For Inventories in Process: = = Actual holding X 365____ Actual holding X 365____ Annual cost of productionAnnual cost of production

• For Finished Goods:For Finished Goods: = = Actual holding X 365____ Actual holding X 365____ Annual cost salesAnnual cost sales

• For sundry debtors:For sundry debtors: = = Actual outstanding debtor’s X 365____ Actual outstanding debtor’s X 365____ Annual salesAnnual sales

• for sundry creditorsfor sundry creditors = = Actual sundry creditors’ X 365____ Actual sundry creditors’ X 365____ Annual purchasesAnnual purchases


Bank BorrowingBank Borrowing

Entities obtain loans from banks in Entities obtain loans from banks in the form of the form of cash creditcash credit against against hypothecation of hypothecation of Inventories and Inventories and DebtorsDebtors


Consortium LendingConsortium Lending

This approach to lending also called the This approach to lending also called the Single Single Window Lending Window Lending was introduced by the RBI in was introduced by the RBI in 1974. Accordingly, more than one bank finances 1974. Accordingly, more than one bank finances a single borrower requiring large credit limit. It a single borrower requiring large credit limit. It

(a)(a) enables banks to spread risk of lending, enables banks to spread risk of lending, (b)(b) broke the monopoly of big banks to have large broke the monopoly of big banks to have large

accounts, accounts, (c)(c) enables banks to share experience and enables banks to share experience and

expertise, expertise, (d)(d) introduces uniformity in approaches to lending, introduces uniformity in approaches to lending, (e)(e) enables banks to pool resources, and enables banks to pool resources, and (f)(f) checks multiple financing of the same account.checks multiple financing of the same account.


Cash Credit FacilityCash Credit Facility

Drawing is permitted against the Drawing is permitted against the Inventory of Goods in a Cash Credit Inventory of Goods in a Cash Credit FacilityFacility

Both Deposits and Withdrawals are Both Deposits and Withdrawals are permitted in this facilitypermitted in this facility

Cash credit facility is offered on a Cash credit facility is offered on a permanent basis, as long as the permanent basis, as long as the business goes on.business goes on.


Types of Cash Credit FacilityTypes of Cash Credit Facility

Cash credit facility is of two types based on the nature of Cash credit facility is of two types based on the nature of charge on goods taken as security by bank.charge on goods taken as security by bank.

(i) (i) Cash credit - PledgeCash credit - Pledge: When the possession of the goods : When the possession of the goods is with the bank. The physical control of the goods is is with the bank. The physical control of the goods is exercised by the bank.exercised by the bank.

(ii) (ii) Cash credit- HypothecationCash credit- Hypothecation: When the possession of the : When the possession of the goods remains with the borrower and a floating charge over goods remains with the borrower and a floating charge over the inventories is created in favour of the bank. The the inventories is created in favour of the bank. The borrower has complete control over the goods and the borrower has complete control over the goods and the drawings in the account are permitted on the basis of drawings in the account are permitted on the basis of Inventories statements submitted by the borrower. Inventories statements submitted by the borrower.


Inventory AuditInventory Audit

Inventories audit is about the Inventories audit is about the authentication of authentication of

quantity, quantity, quality, quality, composition and composition and valuation valuation

of the inventories and debtors. of the inventories and debtors.


Stock Audit CycleStock Audit Cycle

The five stages in any audit are:The five stages in any audit are: Pre-engagementPre-engagement Understanding the entityUnderstanding the entity Audit planningAudit planning Substantive proceduresSubstantive procedures ReportingReporting


Inventories Audit in BanksInventories Audit in Banks

The term Inventories Audit in the context of The term Inventories Audit in the context of banks refers to banks refers to

verification and valuation of the entire verification and valuation of the entire gamut of current assets, current liabilities, gamut of current assets, current liabilities, loans and advances, diversion of funds, loans and advances, diversion of funds, application of funds, application of funds,

accuracy of Inventories statements,accuracy of Inventories statements, arriving at the revised drawing power and arriving at the revised drawing power and any other matter connected with the credit any other matter connected with the credit

administration by the banks.administration by the banks.


Inventories Audit in BanksInventories Audit in Banks

The main purpose of audit in banks is The main purpose of audit in banks is to get an assurance on the quality to get an assurance on the quality and quantity of loan security.and quantity of loan security.

Inventories Audit in Bank verifies the Inventories Audit in Bank verifies the followingfollowing• Physical Verification of the SecurityPhysical Verification of the Security• Valuation of SecurityValuation of Security• Security of the SecuritySecurity of the Security


Meaning of MortgageMeaning of Mortgage

Sec 58(a) of the Transfer of Property Act 1882 deals with Sec 58(a) of the Transfer of Property Act 1882 deals with mortgage. Accordingly, the necessary ingredients of a mortgage. Accordingly, the necessary ingredients of a mortgage are: -mortgage are: -

1. Transfer of interest in specific immovable property1. Transfer of interest in specific immovable property2. Transfer is for the purpose of securing the payment of 2. Transfer is for the purpose of securing the payment of money advanced or to be advanced by way of loan.money advanced or to be advanced by way of loan.3. It may be existing and future debt.3. It may be existing and future debt.4. It may be also for performance of an engagement, which 4. It may be also for performance of an engagement, which may lead to financial liability.may lead to financial liability.


Need for Inventory AuditNeed for Inventory Audit

An Inventories audit is essential for the An Inventories audit is essential for the following purposes:following purposes:

To give the bankers an assurance To give the bankers an assurance regarding the following:regarding the following:• That a suitable environment for preservation of That a suitable environment for preservation of

Inventories existsInventories exists• That a responsible person for safeguarding the That a responsible person for safeguarding the

Inventories is always presentInventories is always present• That degraded Inventories have been written That degraded Inventories have been written

offoff• That adequate safeguards exist against fire That adequate safeguards exist against fire

and natural calamitiesand natural calamities



• That physical inventories tally with the That physical inventories tally with the Inventories statements submitted to bankInventories statements submitted to bank

• That the pledged/hypothecated Inventories is That the pledged/hypothecated Inventories is realizablerealizable

• That Inventories is owned by the borrower That Inventories is owned by the borrower • That all sanction terms have been adhered toThat all sanction terms have been adhered to• That inventories are not stagnating and That inventories are not stagnating and

becoming obsoletebecoming obsolete To investigate, wherever the party is not To investigate, wherever the party is not

submitting periodic Inventories submitting periodic Inventories statements regularly.statements regularly.



To investigate, where the accounts To investigate, where the accounts have been marked as substandard.have been marked as substandard.

To find out reasons when there are To find out reasons when there are too many qualifying remarks about too many qualifying remarks about inventories and receivables in the inventories and receivables in the Auditor’s report on the Balance Auditor’s report on the Balance Sheet of the borrowerSheet of the borrower

To find out suspect dealing in To find out suspect dealing in lending procedurelending procedure



To make the banks aware of their To make the banks aware of their right of enforcement of the security right of enforcement of the security interest provided in the Securitization interest provided in the Securitization and Reconstruction of Financial and Reconstruction of Financial Assets and enforcement of Security Assets and enforcement of Security Interest Act, 2002.Interest Act, 2002.

To fulfill Head Office requirementTo fulfill Head Office requirement


Scope of Inventory AuditScope of Inventory Audit

The scope of the audit covers all the The scope of the audit covers all the aspects that have a direct impact on the aspects that have a direct impact on the working capital of the unit as well as the working capital of the unit as well as the aspects relating to Inventories that have a aspects relating to Inventories that have a bearing on the bank finance. bearing on the bank finance.

It encompasses the following aspects:It encompasses the following aspects:• Physical verification of inventoriesPhysical verification of inventories• Verification of condition of storageVerification of condition of storage• Valuation of inventories and pointing out Valuation of inventories and pointing out

variances variances



• Valuation of obsolete / non-moving Valuation of obsolete / non-moving InventoriesInventories

• Age-wise categorization of inventoriesAge-wise categorization of inventories• Evaluation of the Inventories management by Evaluation of the Inventories management by

the companythe company• Reconciliation of Inventories statements Reconciliation of Inventories statements

submitted with the accounting records submitted with the accounting records maintained by borrowers particularly, relating maintained by borrowers particularly, relating to quantity, rate, value of inventories, age, to quantity, rate, value of inventories, age, marketability, etcmarketability, etc

• Verification and evaluation of sundry Verification and evaluation of sundry creditors indicating separately those relating creditors indicating separately those relating to Inventories and their relationship with to Inventories and their relationship with bank financebank finance



• commenting upon the sources of the raw commenting upon the sources of the raw materials, i.e., whether any credit is available materials, i.e., whether any credit is available for the material and which of the items are for the material and which of the items are available against cash paymentsavailable against cash payments

• Review of the Inventories valuation systemReview of the Inventories valuation system• Age-wise and value-wise qualification of Age-wise and value-wise qualification of

debtorsdebtors• Determination of the drawing powerDetermination of the drawing power• Determining adequacy of the insurance coverDetermining adequacy of the insurance cover• Verification of documents/ securitiesVerification of documents/ securities



• Commenting upon the comparative Commenting upon the comparative Profitability and Inventories ratioProfitability and Inventories ratio

• Ensuring that the compliance of the Ensuring that the compliance of the terms and conditions of limit sanctionedterms and conditions of limit sanctioned

• Verification of transactions with sister Verification of transactions with sister concerns, unsecured Loans to Directors concerns, unsecured Loans to Directors and othersand others

• Any other matters of interest to the Any other matters of interest to the bankbank


When to perform Stock AuditWhen to perform Stock Audit Where there are over dues in term loans Where there are over dues in term loans

or other accounts, where the banks’ or other accounts, where the banks’ stake is high.stake is high.

Where there is evidence of pressure on Where there is evidence of pressure on the borrower from the creditorsthe borrower from the creditors

Where the inventories are stagnating.Where the inventories are stagnating. Where party is not submitting periodic Where party is not submitting periodic

Inventories statements regularlyInventories statements regularly Where there are grounds to suspect that Where there are grounds to suspect that

the position of chargeable current assets the position of chargeable current assets indicated may not be correct.indicated may not be correct.


When to perform Stock AuditWhen to perform Stock Audit Where there are too many qualifying remarks Where there are too many qualifying remarks

about inventories and receivables in the auditors about inventories and receivables in the auditors report on the balance sheet of a borrowerreport on the balance sheet of a borrower

Where the accounts is marked as sub-standardWhere the accounts is marked as sub-standard Suspect dealings in lending procedure, Suspect dealings in lending procedure,

jeopardizing advances givenjeopardizing advances given An errant borrower, where Inventories audit is An errant borrower, where Inventories audit is

needed to supplement actions of the branches for needed to supplement actions of the branches for recovery.recovery.

Any other valid reason such as mismanagement, Any other valid reason such as mismanagement, heavy losses, lockout, strikes etcheavy losses, lockout, strikes etc

Fulfilling the criteria fixed by the head office to Fulfilling the criteria fixed by the head office to get done Inventories audit. get done Inventories audit.


Non Performing AssetsNon Performing Assets An asset, including a leased asset, An asset, including a leased asset,

becomes non-performing when it ceases becomes non-performing when it ceases to generate income for the bank. to generate income for the bank.

With effect from March 31, 2004, a non-With effect from March 31, 2004, a non-performing asset (NPA) shall be a loan or performing asset (NPA) shall be a loan or an advance where;an advance where;

• Interest and/or installment of principal Interest and/or installment of principal remain overdue for a period of more than 90 remain overdue for a period of more than 90 days in respect of a term loan,days in respect of a term loan,

• the account remains ‘out of order’ for a the account remains ‘out of order’ for a period of more than 90 days, in respect of an period of more than 90 days, in respect of an Overdraft/Cash Credit (OD/CC),Overdraft/Cash Credit (OD/CC),


Non Performing AssetsNon Performing Assets

• the bill remains overdue for a period of more the bill remains overdue for a period of more than 90 days in the case of bills purchased than 90 days in the case of bills purchased and discounted,and discounted,

• interest and/or installment of principal interest and/or installment of principal remains overdue for two harvest seasons but remains overdue for two harvest seasons but for a period not exceeding two half years in for a period not exceeding two half years in the case of an advance granted for the case of an advance granted for agricultural purposes, andagricultural purposes, and

• Any amount to be received remains overdue Any amount to be received remains overdue for a period of more than 90 days in respect for a period of more than 90 days in respect of other accounts.of other accounts.


Special Points on Stock AuditSpecial Points on Stock Audit

• If the stock statement as shown in the If the stock statement as shown in the hypothecation statement does not tally with hypothecation statement does not tally with the stocks as in the balance sheet , then the stocks as in the balance sheet , then appropriate action should be taken to find appropriate action should be taken to find reasons for the differencesreasons for the differences

• It should be seen that the stocks have been It should be seen that the stocks have been properly valued, after considering the properly valued, after considering the relevant accounting principles, Accounting relevant accounting principles, Accounting standards (AS) and Engagement Standards standards (AS) and Engagement Standards [ earlier Known as Auditing and Assurance [ earlier Known as Auditing and Assurance standards (AAS)]standards (AAS)]


Special Points on Stock AuditSpecial Points on Stock Audit

• It should be seen that Current Assets It should be seen that Current Assets are not over-stated.are not over-stated.

• It should be seen that the Turnover is It should be seen that the Turnover is not over-stated.not over-stated.

• It should be seen that the stocks that It should be seen that the stocks that are genuinely owned by the borrower are genuinely owned by the borrower are shown in the accountsare shown in the accounts


ICAI PronouncementsICAI Pronouncements

There are no guidance notes or There are no guidance notes or standards prescribed for Inventories standards prescribed for Inventories audit, the auditors should conduct audit, the auditors should conduct the audit based on the generally the audit based on the generally accepted auditing practices and to accepted auditing practices and to the best of his judgment and ability. the best of his judgment and ability.


Relevant StandardsRelevant Standards

AS 2 – Valuation of InventoriesAS 2 – Valuation of Inventories IAS 2 – Accounting for InventoriesIAS 2 – Accounting for Inventories


Relevant RBI NotificationsRelevant RBI Notifications RBI/2010-11/74 DBOD.No.BP.BC.21 /21.04.048/2010-11 – 1RBI/2010-11/74 DBOD.No.BP.BC.21 /21.04.048/2010-11 – 1stst

July 2010 – Master Circular - Prudential norms on Income July 2010 – Master Circular - Prudential norms on Income Recognition, Asset Classification and Provisioning pertaining Recognition, Asset Classification and Provisioning pertaining to Advances to Advances

According to Para 4.2.4According to Para 4.2.4• The classification of an asset as NPA should be based on the The classification of an asset as NPA should be based on the

record of recovery. Bank should not classify an advance record of recovery. Bank should not classify an advance account as NPA merely due to the existence of some account as NPA merely due to the existence of some deficiencies which are temporary in nature such as non deficiencies which are temporary in nature such as non availability of adequate drawing power based on the latest availability of adequate drawing power based on the latest available stock statement, balance outstanding exceeding the available stock statement, balance outstanding exceeding the limit temporarily, non submission of stock statements and non limit temporarily, non submission of stock statements and non renewal of the limits on the due date, etc. In the matter of renewal of the limits on the due date, etc. In the matter of classification of accounts with such classification of accounts with such deficiencies banks may follow the following guidelines: deficiencies banks may follow the following guidelines:


Relevant RBI NotificationsRelevant RBI Notifications

• i) Banks should ensure that drawings in the i) Banks should ensure that drawings in the working capital accounts are covered by the working capital accounts are covered by the adequacy of current assets, since current adequacy of current assets, since current assets are first appropriated in times of assets are first appropriated in times of distress. Drawing power is required to be distress. Drawing power is required to be arrived at based on the stock statement which arrived at based on the stock statement which is current. However, considering the is current. However, considering the difficulties of large borrowers, stock difficulties of large borrowers, stock statements relied upon by the banks for statements relied upon by the banks for determining drawing power should not be older determining drawing power should not be older than three months. The outstanding in the than three months. The outstanding in the account based on drawing power calculated account based on drawing power calculated from stock statements older than three from stock statements older than three months, would be deemed as irregular.months, would be deemed as irregular.


Relevant RBI NotificationsRelevant RBI Notifications

A working capital borrowal account A working capital borrowal account will become NPA if such irregular will become NPA if such irregular drawings are permitted in the drawings are permitted in the account for a continuous period of 90 account for a continuous period of 90 days even though the unit may be days even though the unit may be working or the borrower's financial working or the borrower's financial position is satisfactory. position is satisfactory.


Relevant RBI Notification Relevant RBI Notification ii) Regular and ad hoc credit limits need to be ii) Regular and ad hoc credit limits need to be

reviewed/ regularised not later than three reviewed/ regularised not later than three months from the due date/date of ad months from the due date/date of ad hoc sanction. In case of constraints such as non-hoc sanction. In case of constraints such as non-availability of financial statements and other data availability of financial statements and other data from the borrowers, the branch should furnish from the borrowers, the branch should furnish evidence to show that renewal/ review of credit evidence to show that renewal/ review of credit limits is already on and would be completed soon. limits is already on and would be completed soon. In any case, delay beyond six months is not In any case, delay beyond six months is not considered desirable as a general discipline. considered desirable as a general discipline. Hence, an account where the regular/ ad Hence, an account where the regular/ ad hoc credit limits have not been reviewed/ hoc credit limits have not been reviewed/ renewed within 180 days from the due date/ date renewed within 180 days from the due date/ date of ad hoc sanction will be treated as NPA.of ad hoc sanction will be treated as NPA.


Relevant RBI NotificationRelevant RBI Notification Para 5.3 on Doubtful Assets –Para 5.3 on Doubtful Assets –With a view to bringing down divergence arising out With a view to bringing down divergence arising out

of difference in assessment of the value of of difference in assessment of the value of security, in cases of NPAs with balance of Rs. 5 security, in cases of NPAs with balance of Rs. 5 crore and above stock audit at annual crore and above stock audit at annual intervals by external agencies appointed as per intervals by external agencies appointed as per the guidelines approved by the Board would be the guidelines approved by the Board would be mandatory in order to enhance the reliability on mandatory in order to enhance the reliability on stock valuation. Collaterals such as immovable stock valuation. Collaterals such as immovable properties charged in favour of the bank should properties charged in favour of the bank should be got valued once in three be got valued once in three years by valuers appointed as per the years by valuers appointed as per the guidelines approved by the Board of Directors guidelines approved by the Board of Directors


Relevant RBI NotificationRelevant RBI Notification

Lending under Consortium Arrangement / Lending under Consortium Arrangement / Multiple Banking ArrangementsMultiple Banking Arrangements - RBI/2008- - RBI/2008-2009/379 - DBOD.No. BP.BC.110/08.12.001/2008-2009/379 - DBOD.No. BP.BC.110/08.12.001/2008-09 - February 10, 2009 – Annexure 1 – Part II - 09 - February 10, 2009 – Annexure 1 – Part II - Certifications of borrowal companies by Certifications of borrowal companies by chartered accountants / company chartered accountants / company secretaries/cost accountantssecretaries/cost accountants - Terms of - Terms of reference for stock audit are to be spelt out reference for stock audit are to be spelt out clearly by the Banks, so that the Chartered clearly by the Banks, so that the Chartered Accountants can give focused attention to such Accountants can give focused attention to such areas.areas.


Relevant RBI NotificationRelevant RBI Notification

Lending under Consortium Lending under Consortium Arrangement / Multiple Banking Arrangement / Multiple Banking ArrangementsArrangements - RBI/2008-2009/379 - - RBI/2008-2009/379 - DBOD.No. BP.BC.110/08.12.001/2008-09 - DBOD.No. BP.BC.110/08.12.001/2008-09 - February 10, 2009 – Annexure II – Revised February 10, 2009 – Annexure II – Revised Format under Multiple Banking Format under Multiple Banking Arrangement Credit Information Exchange Arrangement Credit Information Exchange – Part IV – Credit Information Report – III. – Part IV – Credit Information Report – III. Compliance with Financial Covenants – Compliance with Financial Covenants – Stock Statement/ Financial DataStock Statement/ Financial Data


Stock Audit ReportStock Audit Report Format for stock audit report may vary from bank Format for stock audit report may vary from bank

to bank. to bank. A stock audit report should cover the following A stock audit report should cover the following

aspectsaspects• Compliance with terms and conditions of sanction.Compliance with terms and conditions of sanction.• Timely & adequate submission of stock statements & Timely & adequate submission of stock statements &

other important financial information.other important financial information.• Account operations – overdrawing, credit summation Account operations – overdrawing, credit summation

and cash withdrawals.and cash withdrawals.• Drawing power calculations by banks and by the Drawing power calculations by banks and by the

auditors & discrepancies, if any along with the reasons.auditors & discrepancies, if any along with the reasons.


Stock Audit ReportStock Audit Report

• Physical maintenance and storage of stock and Physical maintenance and storage of stock and adequacy of facilities at the borrowers place.adequacy of facilities at the borrowers place.

• Systems / procedures implemented by Systems / procedures implemented by borrower to identify the slow and non-moving borrower to identify the slow and non-moving stock items.stock items.

• Borrower’s Management information system, Borrower’s Management information system, its adequacy & Internal controls to safeguard its adequacy & Internal controls to safeguard stock.stock.

• Method of valuation of stock, time interval for Method of valuation of stock, time interval for valuation and adequacy & sufficiency of valuation and adequacy & sufficiency of procedures thereof.procedures thereof.

• Insurance of stock.Insurance of stock.• Verification of Debtors. Verification of Debtors.


About the AuthorAbout the Author CA. Rajkumar S Adukia is an eminent business CA. Rajkumar S Adukia is an eminent business

consultant, academician, writer, and speaker. He is consultant, academician, writer, and speaker. He is the senior partner of Adukia & Associates.the senior partner of Adukia & Associates.

In addition to being a Chartered Accountant, Company In addition to being a Chartered Accountant, Company Secretary, Cost Accountant, MBA, Dip IFR (UK), Mr. Secretary, Cost Accountant, MBA, Dip IFR (UK), Mr. Adukia also holds a Degree in Law and Diploma in Adukia also holds a Degree in Law and Diploma in Labor Laws and IPR. Labor Laws and IPR.

Mr. Adukia, a rank holder from Bombay University Mr. Adukia, a rank holder from Bombay University completed the Chartered Accountancy examination with 1st completed the Chartered Accountancy examination with 1st Rank in Inter CA & 6th Rank in Final CA, and 3rd Rank in Rank in Inter CA & 6th Rank in Final CA, and 3rd Rank in Final Cost Accountancy Course in 1983.Final Cost Accountancy Course in 1983.

He started his practice as a Chartered Accountant on 1st He started his practice as a Chartered Accountant on 1st July 1983, in the three decades following which he left no July 1983, in the three decades following which he left no stone unturned, be it academic expertise or professional stone unturned, be it academic expertise or professional development.development.


About the AuthorAbout the Author

He has been coordinating with various Professional He has been coordinating with various Professional

Institutions, Associations, Universities, University Grants Institutions, Associations, Universities, University Grants Commission and other Educational Institutions.Commission and other Educational Institutions.

Authored more than 50 books on a vast range of Authored more than 50 books on a vast range of topics including Internal Audit, Bank Audit, SEZ, CARO, topics including Internal Audit, Bank Audit, SEZ, CARO, PMLA, Anti-dumping, Income Tax Search, Survey and PMLA, Anti-dumping, Income Tax Search, Survey and Seizure, IFRS, LLP, Labour Laws, Real estate, ERM, Seizure, IFRS, LLP, Labour Laws, Real estate, ERM, Inbound and Outbound Investments, Green Audit etc.Inbound and Outbound Investments, Green Audit etc.

The author can be reached at The author can be reached at [email protected]@gmail.com. For . For more details log on to more details log on to www.caaa.inwww.caaa.in

6 asv stock audit 1112

Economy & Finance

Transcript of 6 asv stock audit 1112