In case of a Company that has suffered a fire accident leading to destruction of assets like interiors, computer systems, ACs etc (and not books of account, what are the reporting requirements of CARO, in terms of impact on going concern and other issues?
1 Replies
ca hardik
(CA Service cum practice)
(106 Points)
Replied 12 May 2009
As per the CARO requirement, if the management can satisfy the auditor that, eventhough the assets lost in the fire, their going concern will not affect, then no need to qualify the matter in the caro report. but if the auditor is not satisfy with the view of the managment, he has to extend his audit in depth and collect the documentory evidence which shows that the going concern will not affect. and this regard aprat from the external evidence, auditor can take management representation on the matter of the going concern applicability.
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