Lec 02 Audit Intro & Ch 04 SA 500

FRF is used for preparation of ?

• Annual Report

• Board of Directors Report

• Financial Statements

• Tax Return

Who has to read & understand law & regulation and determine AFRF for entity and if there is choice select FRF as AFRF ?

• Government

• SEBI

• NFRA

• Management

Company has prepared complete and accurate balance sheet, p&l & cash flow statements, they did not mention that there land & building are given as security for loan taken and there is charge over them. Auditor advised them to mention this in notes to accounts. Is it is a Misstatement ?

• No, it doesnt impact balancing of B/S

• No, as assets and liabilities are properly stated

• Yes, as it is required to be disclosed as per AS & Sch III

• Yes, as they are not following auditor's advice

Management is impressed with knowledge and skills of auditor, They want auditor to report following points in audit report, which of the following he can report ?

• Efficiency of Company in Business

• Appropriateness of Organisation Structure

• Material Misstatements in Financial Statements

• How to save taxes

Company has shown of scrap sales of 20 crores in other income ? Which of the following can be useful to authenticate it

• MOA / AOA

• Attendance Register

• Confirmation from Creditors

• Raw Material Consumption & Production Records