Latest Expert Exchange Queries
sitemapHome | Registration | Job Portal for CA's | Expert Exchange | Currency Converter | Post Matrimonial Ads | Post Property Ads
 
 
News shortcuts: From the Courts | News Headlines | VAT (Value Added Tax) | Service Tax | Sales Tax | Placements & Empanelment | Various Acts & Rules | Latest Circulars | New Forms | Forex | Auditing | Direct Tax | Customs and Excise | ICAI | Corporate Law | Markets | Students | General | Indirect Tax | Mergers and Acquisitions | Continuing Prof. Edu. | Budget Extravaganza | Transfer Pricing
 
 
 
 
Popular Search: ARTICLES ON INPUT TAX CREDIT IN VAT :: due date for vat payment :: ACCOUNTING STANDARD :: VAT Audit :: form 3cd :: ICAI offer Get Windows 7,Office 2010 in Rs.799 Taxes :: ACCOUNTING STANDARDS :: articles on VAT and GST in India :: list of goods taxed at 4% :: TAX RATES - GOODS TAXABLE @ 4% :: empanelment :: cpt :: TDS :: VAT RATES :: Central Excise rule to resale the machines to a new company
 
 
News Headlines »
 Directions under section 119 of the Income-tax Act, 1961
 Securities excluded from GST ambit in revised Bill
 GST dilemma: Hope fades for new tax regime
 5nance.com launches tax investment platform
 Is government tapping your phone?
 Income tax department to use analytics to look for discrepancies in bank accounts
 GST Council fails to break deadlock over indirect tax regime, next meet on Dec 11 and 12 to hammer out differences
 Invoking Writ Jurisdiction For Income Tax Matters
 How to file income-tax returns online
 How Income Tax Returns Are Scrutinised
 All About New Income Disclosure Scheme to make Demonetisation successful

ICAI tightens auditing norms to prevent frauds
March, 11th 2009

To prevent recurrence of Satyam-like frauds, the ICAI on Monday tightened the auditing standards by introducing new guidelines which will enable auditors interlink information and reports of other stakeholders and evaluate them.

The two new standards on auditing, said Atul Kumar Gupta, member of the regional council of Institute of Chartered Accountants of India (ICAI), "will enable auditors to interlink the information and reports of other stakeholders, evaluate them, and substantiate the credibility of financial statement."

The Standard of Accounting (SA 720), introduced for the first time by the ICAI, deals with auditor's responsibilities in relation to information, other than audited financial statements, provided by companies in annual reports. These auditing standards, Gupta said, will also help auditors "to go beyond just receiving the evidences by evaluating them on prudence principles."

So, auditors will now play a wider role in the affairs of a company and apart from financial statements, they will also inspect 'other information' to look for possible material inconsistencies. Other information includes a report by management or those charged with governance on operations; financial summaries or highlights; planned capital expenditures; financial ratios and selected quarterly data.

The standard (SA 720) specifies an auditor's responsibility in relation to other information in documents containing audited financial statements like an annual report. The standard is a first of its kind for Indian auditors who need to study other information to identify any material inconsistencies vis-a-vis the audited financial statements to make the audit reports fool-proof.

The standard effective for audits of all financial statements for periods beginning on or after April 1, 2010 said the auditor shall make appropriate arrangements with management or those charged with governance to obtain the other information before preparing report. "If it is not possible to obtain all the other information prior to the date of the auditors report, the auditor shall read such other information as soon as practicable," the standard says.

If the auditor comes across an apparent material misstatement of fact while scrutinising other information, he should raise the matter with management. And in case the management refuses to correct the misstatement, the auditor should report the matter.

The other matter approved by the ICAI council is a revision of the standard related to audit evidence. "Audit evidence is fundamental aspect on which the final audit opinion and the audit report is based. The quality and effectiveness of an audit is, therefore, to a large extent affected by the adequacy and appropriateness of the auditors procedures in gathering and evaluating the audit evidence," ICAI said.

The revised version contains greater guidance for the auditors on critical aspects of audit evidence such as what constitutes sufficient appropriate audit evidence, information to be used as audit evidence, factors to consider in selecting items for testing, how to respond in case of inconsistency in or doubts over reliability of audit evidence.

 
 
Home | About Us | Terms and Conditions | Contact Us
Copyright 2016 CAinINDIA All Right Reserved.
Designed and Developed by Binarysoft Technologies Pvt. Ltd.
Software Work Flow Workflow Software Software Automation Workflow automation Software Design Workflow Design Business Work Flow Workflow automation tools

Transfer Pricing | International Taxation | Business Consulting | Corporate Compliance and Consulting | Assurance and Risk Advisory | Indirect Taxes | Direct Taxes | Transaction Advisory | Regular Compliance and Reporting | Tax Assessments | International Taxation Advisory | Capital Structuring | Withholding tax advisory | Expatriate Tax Reporting | Litigation | Badges | Club Badges | Seals | Military Insignias | Emblems | Family Crest | Software Development India | Software Development Company | SEO Company | Web Application Development | MLM Software | MLM Solutions