Академический Документы
Профессиональный Документы
Культура Документы
Internship
Report
Grant Thornton Anjum Rahman
Nida Khalid
2017-11-0013
Client: Pioneer Cement Limited
Duration: 22/07/15-28/08/15
Nida Khalid
17110013
3. Audit methodology
4.1 Voyager
4.2 IDEA
4.3 T-BeaM
4.4 Pentana
5. Area Assigned to me
6. Learning Experience
6.1 Time Management skills
NIDA KHALID 1
Nida Khalid
17110013
Grant Thornton Anjum Rahman (GTAR) is one of leading firms of chartered accountants in
Pakistan. It is committed to provide the highest quality of professional services in accounting,
auditing and taxation. GTAR has 6 partners, employing over 300 people and having an office
network spread over 3 major cities of the country, vis--vis: Karachi, Lahore and Islamabad.
Grant Thornton Anjum Rahman was formed in 1986. It has rapidly expanded into one of the
most progressive and professional service organizations. The combined professional and
industrial knowledge, experience and resources enable them to provide an outstanding level of
services to the clients.
Besides auditing and accounting as one of its core services, the management consulting practice
of GTAR is one of the most active practices in Pakistan, providing a wide range of services in
areas including financial management and accounting, resource mobilization, strategic services,
capital markets, information technology and human resource development / management.
NIDA KHALID 2
Nida Khalid
17110013
Grant Thornton provides business assurance services to many multinational, medium sized
companies, non-governmental organizational and donor agencies.GT conducts audits of clients
as required by the various laws in Pakistan and also conduct them as special projects where audit
requirements are not mandatory.
Management audits
Internal audit
Investigations
Compliances Services
Representation and Litigation with Tax Authorities
Expatriates and Personal Income Tax Services.
They also align the tax
Moreover, GT also provide international taxation services that include advisory, compliance and
litigation. The international network covers 110 countries in the world which provides them with
the resources to meet the international tax requirements of the business. International business
efforts to achieve higher tax efficiency and risk limitation. These services include:
Ex-patriate Tax
They also offer a wide range of expatriate tax services which includes:
NIDA KHALID 3
Nida Khalid
17110013
Dealing on behalf of clients with the various government bodies related to corporate
legislation such as the Corporate Law Authority, Monopoly Control Authority and
Ministry of Finance
Advice and assist in setting up of corporate structures
Flotation, liquidation and winding up of joint stock companies
Assistance in incorporation of companies
Providing corporate technical advice and secretarial services in completing documents
and acting as company secretary
Provision of services of obtaining relevant permissions relating to foreign investment and
operation of foreign companies in Pakistan from government agencies including Board of
Investment (BOI).
These firms operate in 113 countries in 521 offices internationally. It works as independently
owned and manage consulting and accounting firms. Each member firm is an independent legal,
financial and administrative entity. These are commonly organized under the laws of the country
where it practices locally.
IBCs are located in major commercial centers around the world as a gateway to the international
service capabilities of all Grant Thornton firms.
NIDA KHALID 4
Nida Khalid
17110013
1.5. Specialization
Grant Thornton specializes in both business assurance services and tax services. They provide
audit and Tax services to a diverse portfolio of clients in wide-ranging business segment.
The plant of Pioneer Cements is located at Chenki, District Khusshab, in the Punjab Province,
250 km away from Lahore. The head office is located at Ferozpor road Lahore. Other zonal sales
offices are located at :
OPC
OPC is used worldwide, it is used in all kind of concrete construction. Pioneer OPC, in addition
to its Exceptional strength, is specially designed for:
NIDA KHALID 5
Nida Khalid
17110013
SRC
SRC is used where sulfate salt is present in soil or in saline water. SRC is designed to overcome
the problem of sulfate attack by reducing its C3A content.
Pioneer SRC is highly effective for the purpose it is used because its C3A content is even less
than 2.0 against max. Permissible limit of 3.5 in British and Pakistan Standards.Thats why,
Pioneer SRC is demanded and used on Major Projects of National interest like Thal Greater
Canal.
NIDA KHALID 6
Nida Khalid
17110013
NIDA KHALID 7
Nida Khalid
17110013
NIDA KHALID 8
Nida Khalid
17110013
NIDA KHALID 9
Nida Khalid
17110013
NIDA KHALID 10
Nida Khalid
17110013
The Financial performance of the company can be seen in the following figure.
NIDA KHALID 11
Nida Khalid
17110013
NIDA KHALID 12
Nida Khalid
17110013
Ratio Analysis
The ratio analysis of performance of Pioneer cements is shown below. Current ratio, Interest
coverage ratio and market value per share has increased dramatically over the past few years.
NIDA KHALID 13
Nida Khalid
17110013
Client acceptance
Predecessor Auditors
Independence
Engagement Profile Factor
Engagement letter
Pre audit activities are carried before acceptance of new client (or reacceptance in case of
existing client) to ensure compliance with Independence requirements. These activities includes
communicating with previous auditors and taking into consideration various factors which may
cause threat to independence of the firm in relation to the audit client on the basis of which it is
decided whether to accept an audit client or not.
Moreover, before commencement of audit, an engagement letter defining the scope of audit,
responsibilities and roles of both parties are signed by both the audit client and firm in order to
meet the requirements of ISA 210.
NIDA KHALID 14
Nida Khalid
17110013
Information about the company, its nature, its operations, applicable financial reporting
framework is obtained. Entity level controls are recognized. Risk indicators that might affect the
audit client and its financial reporting are identified, for example adverse regulatory
requirements. An understanding of company's accounting as well as IT system is also obtained
during this stage. Preliminary analytical procedures are carried to identify significant
fluctuations.
Materiality
Information is mainly obtained through management. The following discussions are made with
various levels of management.
Fraud
Reasons for significant fluctuations in operations
NIDA KHALID 15
Nida Khalid
17110013
Matters are discussed with those charged with governance regarding the awareness of any
instances of fraud, risk of fraud and audit committees response on fraud.
Discussions among audit are carried on periodically to exchange various risks identified during
the risk assessment stage. This also involve questions regarding material misstatements, override
of internal control and misappropriation of assets. This includes linking risks identified to
financial statements. Risk audit strategy is developed based on preliminary analytical procedures
and entitys accounting system.
Moreover, it is planned whether to go for Walkthrough or Test of Control (TOC's) for various
significant accounting cycles.
Responses are designed based on risk assessment procedures. If assessed risk of material
misstatement is low and intend to rely on controls of the entity then team would go for TOC's
otherwise we would go for substantive testing.
For substantive procedures IDEA software is used for sample selection using the technique of
random selection. Procedures to be performed are generated by Voyager based on the risk
NIDA KHALID 16
Nida Khalid
17110013
Also the material misstatements are concerned that either they are correct or not. Also whether
there are adjusted material misstatements.
Representation letter is obtained from management of the company in which management takes
responsibility of financials and other matters as well as makes representation that it has made
available all the information required by the auditors.
Significant matters identified during the audit are discussed with engagement partner for their
resolution. Further these are also communicated to management through Board Letter issued to
management.
NIDA KHALID 17
Nida Khalid
17110013
After obtaining assurance that sufficient and appropriate audit evidence has been obtained
initialed financials and Board letter are issued. It is ensured that there are no adjusting entries.
Internal control deficiencies identified during the audit are communicated to management
through Management letter issued within 45 days of audit report.
Audit Softwares:
GT use several Audit Tools to assist in examining and testing clients' accounting records. The
detail of which are as follows:
4.1. Voyager
Audit teams use this software to identify financial statement risks and link them to the processes
and internal controls that they established to address those risks. This enables audit team to tailor
an audit response that is appropriate to the assessed risks. So, this software is used in following
stages of audit:
4.2. IDEA
Idea is a data extraction and analysis tool. Its one of many important uses is sampling. IDEA
enables auditors to extract and analyze data in a matter of seconds, resulting in a more efficient
audit process that is less burdensome for our clients. Audit teams use IDEA software for
following tasks:
NIDA KHALID 18
Nida Khalid
17110013
These are
Tolerable error
Confidence error
Expected error.
4.3. T-Beam
T-Beam is mainly used for Trail maintenance. T-Beam is used for work paper generation
package used in following phases of audit
Audit planning
Analytical procedures
Production of work papers and financial statements.
4.4. Pentana
It is a software program used to ensure that the financial statements disclosures are in accordance
with the International Financial Reporting Standards.
5. Areas Assigned
I went to Grant thornton in the mind of final audit. Pioneer cement is one of its most important
client, I was assigned with my co-internee and 6 other audit trainees for their final audit. Mainly
I was assigned administrative expenses and then I was assigned many more tasks related to taxes
and fixed assets. All areas assigned to me include below tasks
And each category was further divided into categories, and the vouching of these were done. For
example, Salaries, Wages and Benefits were further divided into
Salaries
Salaries To Executives
Salaries To Staff
Salaries To Contractual Employees
Daily Wages
Salaries To Chief Executive
Benefits - Hospitalization
Benefits - Hospitalization Executives
Bonus / Ex-Gratia
Ex-Gratia / Bonus To Executives
Ex-Gratia / Bonus To Staff
Benefits - Leave Encashment
Leave Encashment - Executives
Leave Encashment - Staff
NIDA KHALID 20
Nida Khalid
17110013
NIDA KHALID 21
Nida Khalid
17110013
For example, For the vouching of vehicle expenses, all the related receipts, bills and approval
documents (that should sums up to total amount mention in ledgers) were examined. The receipts
from car repairing shops and petrol pumps covering small amounts were also examined. If
amount differ from that mentioned in ledgers then I inform management about this and they
made the required changes to their amounts.
For the Vehicles vouching and reasoning, I have to collect all the documents from
management, which includes Quotation, Purchase order, Registration documents, Invoices,
cheque , withholding tax and other bank statements. And after getting the proper supportings,
check them for Purchase order
I investigated carefully all the vouchers provided by the client and highlighted all the
important areas of concern. I expressed the concerns in front of the client and obtained details
of all the expenses mentioned in that voucher. As these were legal expenses so I had to
inquire about the nature of each case to understand the nature of expenses. It was necessary
to get deep insight of all the cases and to know the related parties because of the complex
nature of cases. For example, I have to acquire information from management and get
knowledge from my supervisor regarding tax provision and legal cases on company. Also I
had to be careful about big amount transactions, for example charity to IBA of 10 million, I
have to investigate all the documents and statements carefully.
For many expense I have to vouched documents from trial movements of all the offices
(Lahore, Islamabad and Karachi branches) of Pioneer and factory, and then consolidate their
amount.
NIDA KHALID 22
Nida Khalid
17110013
Executives
Employees
Bank's margin against letter of credit
Suppliers
Contractors
Service providers
For their audit, I have to examine all the relevant documents, approval, detail movement and
confirmation date. Proper documents stating requirements and limits of loans and advances
were also examined.
Problems observed
NIDA KHALID 23
Nida Khalid
17110013
Sometimes the amount was too little that it was difficult for management to provide
proper documentation for those
Sometimes it took time for management to gather documents and records which
delayed my work to a day or two.
Keeping professional behavior with management of client was also a not an easy task
for a cheerful person like me, but I have to do it in order to fulfill the requirement of
professional behavior for audit.
6. Learning Experience
The learning experience I got from GTAR was much more than I expected. It added a lot to me
knowledge and improved my management, interpersonal and presentation skills.
6.1. Time management Skills
The time management skills we read in books are easier but when it comes in practical life, then
there comes much more responsibility with it. I went to my client at the time of final audit so
there was much to do in specific period of time. There was much work at the end, and our
manager has given the deadline so we have to complete our work before that. Observing which
documents are required, listing them properly, asking supporting from management, verifying
them from ledgers and bank statements, documenting the reasoning for those amount take a lot
of time. So I have to plan my work keeping the time pressure that time. I used to give one list of
required documents on one day while verifying other sets of documents that day, so that
management can take their time to provide me each and every document required for my task
and I can work on already handed over documents without wasting time. During last few days of
audit, we have to work in even our lunch break so that we can complete it in proper time. Late
sittings were done in last two weeks of audit so that we can work on finalization of audit with
our team.
Our office timings were from 9 to 5, but we have to reach before 8.45 so that after attendance we
can start out work exactly at time. And at the off time, we have to remain in office for work till 6,
7 pm even after the management left.
One interesting thing while audit was to order food on time so that restaurants can deliver that on
time and we can enjoy our meal in lunch break, otherwise having lunch out of lunch time break
doesnt seem that good.
NIDA KHALID 24
Nida Khalid
17110013
spend 9 10 hours there (at first doing little work with much time and at the end doing much work
in less time). My team help me in understanding the right balance between seriousness and
frankness. When I have to go to managers to inquire about some information then I maintain my
professional behaviour that help me in many aspects, for example, Managers took my words
seriously and then provide me all required documents in time. I have to be independent so
frankness and friendship with them can harm my professional requirements of independence.
Also we were told that when management tries to give any favour you should avoid that. For
example, while driving to office, I had an accident and my car got damaged. Two of the
managers there asked me to get my car repair and the company will pay for that. But I have to
neglect that offer as taking benefits from client side can make me bias towards it.
Overall my experience in this internship was excellent. I got many valuable things to learn
which theoretical things can never teach. This internship has changed my perception about job,
NIDA KHALID 25
Nida Khalid
17110013
learning and skills implementation. Moreover, this internship was better than other internships
offer for volunteer teaching or job purpose as it was more of professional sort job. In short, this
internship was a very valuable experience for me which would definitely help me in the future
professional career.
NIDA KHALID 26
Nida Khalid
17110013
Work Cited
<http://www.pioneercement.com/accounts/2015/final2015.pdf>
NIDA KHALID 27