RTI, MUMBAI / DAY 1 / Slide 1.3.1 WELCOME TO A TALK ON… AUDITING STANDARDS.
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Transcript of RTI, MUMBAI / DAY 1 / Slide 1.3.1 WELCOME TO A TALK ON… AUDITING STANDARDS.
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
WELCOME TO A TALKON…
AUDITING AUDITING STANDARDSSTANDARDS
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
INTRODUCTION Audit Mandate -
CAG’s (DPC) Act, 1971 prescribes functions, duties and powers of SAI
Audit Mandate includes Audit of
Receipt and Expenditure from
Consolidated Fund
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Introduction (contd.)
Contingency Fund and Public Accounts Trading, Manufacturing, Profit and
Loss Account and Balance Sheet Accounts of Stores and Stock Government Companies Statutory Corporations Authorities and Bodies substantially
financed Grants and Loans for specific purposes
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Audit Objectives
To safeguard financial interests of the Government
Uphold and promote public accountability Sound and economical financial practices Audit assists Parliament/Legislatures in
exercising financial control through PACs/COPUs
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Audit objectives (contd.)
Executive Governments and not Audit is responsible for enforcing economy and efficiency in expenditure
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Scope of Audit
Term includes financial as well as
performance audit
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Basic Postulates
Audit must exercise its best judgement in determining -
audit procedure basis of forming opinion contents of his report due professional care
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Basic Postulates (contd.)
test audit and hence auditor is not responsible
independent attitude Audit independent Auditor’s right to inspect any record,
documents, call for information, clarification
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Auditing standards can be broadly grouped under
1 General Standards
2 Operational Standards
3 Reporting Standards
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
1 GENERAL STANDARDS
A Professional
B Manuals and Instructions
C Quality Assurance
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
General Standards -Professional
Qualification Training Auditor should develop proper
insight
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
General Standards
Manuals and instructions
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
General Standards
Quality Assurance Appropriate internal control system to
ensure quality of work
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
2. OPERATIONAL AUDIT STANDARDS
Audit Planning
Financial Statement Audit
Regularity and Legal Audit
Performance Audit
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Operational Standards -Audit Planning
Audit should be properly guided directed and supervised sufficient understanding of the
internal control system of the auditee organisation
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Operational Standards - Financial Statements Audit
Financial Statements are accurate and complete
True and fair view prepared based on generally accepted
accounting principles(GAAPs) sufficient disclosure
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Operational Standards -Performance Audit
Achievement of physical and financial goals and targets
social and economic objects utilisation of resources as per
projected outlay cases of overpayment, losses,
avoidable, excess or infructuous expenditure due to improper planning
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Operational Standards -Performance Audit(contd..)
Delays in completion overstaffing
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
2 OPERATIONAL AUDIT STANDARDS(contd)
Audit of Receipts Audit of Government Companies Auditing in EDP Environment Audit Evidence (i) Sufficiency (ii) Relevance (iii)Competence
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Reporting Standards
Field Audit Report -
Observations and conclusions in an appropriate form
Contents should be easy to understand
Report should be complete
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Reporting Standards (contd.)
Accurate
Convincing
Clarity
Concise
Follow up of Audit Reports
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Reporting Standards (contd.)
Report should be free from vagueness or ambiguity
relevant information supported by audit evidence timeliness
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RTI, MUMBAI / DAY 1 / Slide 1.3.1
Reporting Standards (contd.)
Follow up of Audit reports Adequate Prompt Proper