Auditing and Ethics - September 2025

CA Student Kalyan was going through a topic on “Audit programme” and learnt that an audit programme is designed to provide most appropriate audit evidence by prescribing procedures and techniques to verify an assertion. Guide the student in answering the following: (i) What type of audit evidence shall an auditor look into as the most appropriate evidence in verification of an assertion? (3 Marks) (ii) Specify the most appropriate audit evidence in respect of: verification of Cash in hand verification…

(a) What do you mean by ‘Deficiency in internal control’ and ‘Significant deficiency in internal control’? (5 Marks) (b) CA Student Ravi is learning the concept of “Key Audit Matters”. However, he is confused between modification of audit report and reporting of key audit matters. You are required to guide him in explaining the following: (i) Purpose of communicating Key Audit Matters (2 Marks) (ii) Communicating Key Audit Matters is not a substitute for disclosure in financial statements. (3 Marks)…

CA Student Manoj is studying on the exemptions available to a private limited company in respect of certain reporting requirements. You are required to guide Manoj on the following: (i) Applicability of Reporting requirements on adequacy of Internal Financial Controls (IFCs) with reference to financial statements to a private limited company. (2 Marks) (ii) Applicability of Companies (Auditor's Report) Order, 2020 to a private limited company. (3 Marks) 17 INTERMEDIATE EXAMINATION: SEPTEMBER 2025 (b) Enumerate the factors that may make…

Co; Chartered Accountants were conducting an audit of an LLP. They have verified the Receivables and concluded that all the Receivables are genuine and recoverable. However, before the final completion of the audit, the auditors came to know of severe financial crisis of one of the Receivables, M/s. Raj Enterprises, whose outstanding account balance was material to the overall Receivables figure as on the date of financial statements. CA Takur had discussions with the appropriate level of management to address…

(a) CA Taman is the auditor of a company dealing in trading of mobile accessories. This year the company has also started assembling of mobile phones. The audit manager instructed the team to develop the audit programme based on the previous year's audit plan and proceed with the audit. However, CA Taman disagreed, explaining to the audit manager that before commencing the audit and throughout its course, she would plan the nature, timing and extent of direction and supervision for…

(a) State the required disclosures for inventories Schedule III (Part I) to the Companies Act, 2013. required under (5 Marks) (b) A government department conducted an inventory audit and discovered that several items in inventory were found to be either damaged or obsolete, but they had not been removed from the records. There were no periodic physical verification reports of inventory, and the valuation of the materials in stock was outdated. Explain, how the audit of stores and inventories, as…