Audit is a investigation of some statement

of figures involving examination of

certain evidence so as to enable an auditor
to make a report on the statement.
 Examination of book
An independent person Qualification (CA)
of accounts

Comparison Verification Confirmation

Opinion Report
AN INDEPENDENT PERSON:- An auditor may be an
independent person. There are not a relation of employee
and employer between him and his client.
QUALIFICATION :-An auditor must be chartered
accountant.
EXAMINATION OF BOOK OF ACCOUNTS :- A critical
review of the system of book of accounts and internal
control and its design and operations in a concern to
ascertain its adequacy and appropriateness to the concern.
COMPARISON :- A comparison of book of accounts with
the unclerlying voucher to ensure that they are in
agreement therewith.
VERIFICATION :- Verification of a result show
by the profit and loss account and state of affairs
disclosed by the balance sheet of the organization.
CONFIRMATION :- An audit is require
confirmation with statutory provision.
OPINION :- Expression of opinion by the
auditing on the results of companies.
REPORT :- Finally, expression of comment by
the auditor by way of report to the client stating
whether in his opinion the book of account present
a time and fair view or not.
 Help in decision making
 The accounts of a company and its financial position
can be examined by an independent and
qualification auditor.
 Audit safeguard the interests of the worker, owner,
investors and creditors.
 In case a running business is proposed to be sold
purchase consideration can easily be determined on
the basis of audited accounts.
 It is more expensive.
 Not suitable for small traders.
 Faulty techniques are involved.
 It is based on inside information
 Post mortem technique.
Applied to auditing principal is the fundamental truth
necessary for the effective accomplishment of the
auditing objective:-

Principal of independence :- He must not be

influenced by any person connected with the
enterprise under audit.
Principle of objectivity :- The auditor must be free
from bias.
Principal of honesty :- An auditor should
be honest.
Principle of full disclosure :- it requires
full disclosure in report.
Principal of materiality :- It indicates that
more attention must be paid to those items
which are materially important.
The regulatory regulation system for auditing
activities, which regulates the responsibility of
auditors in the formation of audit findings and
conclusion.
Right, duties and responsibilities of economic
entities and audit firms in the formation of
audit findings .
PRINCIPLES OF AUDITING (DEI
COLLGES BOOK)
www.wikipedia.com
www.slideshow.com