Freinds plz giv me hints abt wat should be written in following questions of Nov 11 CA FInal audit -
Q 1a
Q 1d
Q 3c
Q 5a (i)
Q 5c
3 Replies
kirti
(article)
(43 Points)
Replied 05 November 2011
study for law dear....u have two days....in law u can get exemption if u study well...dont forget to read practice manual...
Sushant Lohani
(CHARTERED ACCOUNTANT)
(1051 Points)
Replied 05 November 2011
Q1a: The answer is centred around SA 620. U can mentioned ifs and buts because the question isn't that clear.
Q1d. I am also confused about this. As per me, ABC can be alleged with negligence. But he can produce working papers as well as proofs from management that the responsibility of that revenue was not under them. He shall produce his working papers. As well as the audit report they have prepared. Where he should have mentioned the areas which he has audited. SA299 suggests proper documentation and bifurcation of work. When bifurcation is not possible,then both are jointly liable. But here bifu. is possible and has been executed by both firms. Only, that ABC will have to face troubles convinsing the allegors and ICAI(if complaint filed of neg.) that it wasn't in his area.
Q3c. As per me,AS-9 is applied and as there is no uncertainty regarding collection of fees; and service is charged on service-provision method(rent is a service); Rental income is charged in year of audit(Correct action by Co). Also, as the share of TO is accruing to present year, the making of invoice after the year end doesn't delay rev. recognition. It also should be recognised in current year as "accrued income" assuming the payment is after year end.
Q5a(i) Form 3CD relating to Sec269SS or S(i am not ure what i wrote)
Q5c. My answer is that,
the auditor should report it in BS as related party transaction as per AS18.separate disclo.
In 227(1A), also check whether loans and adv have been shown as deposits; & whether they have been made at terms preju.............
Also check the calculation of accrued interest.
Check whether it is secured by some asset..................blah blah.
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