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CHAPTER-I

1.1 INTRODUCTION
Auditing is a systematic examination of the books of accounts and records of a
business or other organization, in order to ascertain or verify, and to report upon the facts
regarding its financial operation and the results there of. Auditing is to express an opinion on
the quality of financial statements, which mean the balance sheet and profit & loss account.
The opinion on financial information is expressed after careful examination of books of
account, Documents, records and vouchers. Apart from review of financial data, auditing
extends to review of areas such as system and operation of any entity.

1.2 OBJECTIVES OF THE TRAINING

 Understand the essential steps in the performance auditing process including


planning, fieldwork, and reporting.
 Conduct risk assessment and planning activities through the utilization of leading
edge practices and techniques, including program mapping.
 Develop high quality audit programs that include audit objectives and sub-objectives;
understand the need to support the objectives and sub-objectives with selected
methodologies and types of evidence; and anticipate the impact of potential audit
recommendations.
 Understand approaches for assuring sufficient and appropriate audit evidence.
 Identify the guidance and requirements of professional audit standards related to the
audit process.
 Use auditor judgment guided by audit objectives and methodologies to triangulate
evidence and develop high impact findings.
 Use techniques for developing and writing high impact audit findings,
recommendations, and reports.

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1.3 SCOPE OF AUDITING

In comparison with earlier days, where the main objective of auditing was to detect
fraud, we now have enhanced ways to determine a true and fair view of financial statements.
In recent times, almost every country of the world has introduced various legislations and
framed rules and regulation of auditing. In India also legislations related to Tax Audit, Cost
Audit, Management Audit and operation Audit, etc. are coming up. The main purpose of
auditing is to certify the correctness of financial statements and to detect errors and frauds.

1.4 TECHNIQUES OF AUDITING

Following are the common techniques of auditing

 Checking of posting and casting.


 Physical verification of assets.
 Verification and examination of transactions with available evidences.
 Scrutiny of the books of accounts,
 Checking of various calculations.
 Checking of carried forward balances in next year.
 Checking of Bank reconciliation statements.
 Auditor can get information from inside and outside sources of organization.

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CHAPTER - II

2.1 PROFILE OF THE AUDITOR

Name Accountant :

Year of establish :

Owner :

Address :

Mobile :

Email :

Area of Services :

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2.2 COMPANY PROFILE
K. S. Jagannathan & Co, Chartered Accountants, (KSJ) is a leading accounting firm
rendering comprehensive professional services which include Independent Audit &
Assurance, Foreign Exchange and Regulatory Consulting, Restructuring and Valuations,
Accounting and Corporate Support, Personnel Recruitment, Legal and Secretarial Support
and Management Consulting and Tax Consultancy, Tax Audit and Advice on Indirect Taxes.
KSJ was established in Chennai in 1979. KSJ was founded by late Shri. K.S. Jagannathan, a
pioneer in auditing profession in India.
KSJ is one of the few audit firms in India to be selected for review by the “Peer
Review Board” of the Institute of Chartered Accountants of India, Delhi. The review was
done in the year 2005. The review was conducted successfully and KSJ has been issued
necessary certificate in this regard. This certification gives an assurance that the audit
procedures and processes followed by KSJ are of high standard.
The firm boasts of a very prestigious clientele, which includes corporate houses &
MNC's from across industries and continents, project offices of foreign companies, branches
of foreign enterprises, partnership firms, high net-worth individuals, public charitable trusts
& others.
Engagements for the above clients include audit & assurance services, due diligence
reviews, investigations, advisory services on Foreign Exchange related areas and Legal
Advisory Services besides undertaking certification of foreign exchange remittances, royalty
payments, commission income from foreign principals, export earnings. KSJ undertakes
restructuring and valuations for private sector companies. KSJ's professional work is spread
all over the country and abroad. Within the country, KSJ reaches out not only to the metros
and large cities but even to many remote locations etc.
KSJ clients' have global operations through their Branches / Marketing set-ups in
USA, UK, Far-East, Middle East and Australia, Korea & China. KSJ also helps with
selection and recruitment of top level finance personnel for clients including those requiring
placement abroad.
KSJ clients are diversifying their activities by entering into technical collaborations
with business giants in the world and forming Subsidiary Companies within India and abroad
through Joint Ventures.

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2.3ORGANIZATION CHART

AUDIT

FINANCING ACCOUNTING

ADMIN SENIOR ADMIN ADMIN

EMPLOYER EMPLOYER EMPLOYER

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CHAPTER-III
DEFFERENT TYPES OF DEPARTMENTS

Auditors
Auditors are specialists who review the accounts of companies and organizations to
ensure the validity and legality of their financial records. They can also act in an advisory
role to recommend possible risk aversion measures and cost savings that could be made.
Auditors work in the accounting departments of a huge range of firms and with independent
chartered and certified firms, examining the money going in and out of organizations and
making sure it is recorded and processed correctly.
 collating, checking and analyzing spreadsheet data
 examining company accounts and financial control systems
 gauging levels of financial risk within organizations
 checking that financial reports and records are accurate and reliable
 ensuring that assets are safeguarded
 identifying if and where processes are not working as they should and advising on
changes to be made
 preparing reports, commentaries and financial statements
 liaising with managerial staff and presenting findings and recommendations
 ensuring procedures, policies, legislation and regulations are correctly followed and
complied with
 Undertaking reviews of wages.

Auditors work typical office hours from 9.00 am to 5.00 pm, Monday to Friday. They may
need to work extra hours or during the weekend to meet deadlines, particularly during tax
audits. Auditors sometimes travel to meet clients and visit factory or warehouse locations in order to
make stock and equipment checks.
INTERNAL AUDITORS
 Work for professional firms outsourced by client companies
 Work in-house as part of an organization’s accounting team
 Work for large private companies, organizations and charities.

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Internal auditors work largely in the private sector to improve the efficiency of businesses
and identify where processes are not working as they should. As well as reviewing financial
accounts, they also look at aspects of the company such as ethics, environmental
sustainability, reputation and growth.
EXTERNAL AUDITORS

 Work with private firms of accountants, or in the public sector for the National Audit
Office
 Carry out obligatory audits of the public sector and governmental bodies
 May be called to examine the finances of private businesses, especially those working
in association with governmental bodies.
External auditors play a vital role in ensuring that money raised by taxes is used effectively
and efficiently.
SKILLS FOR AUDITORS
 Self-motivation, determination and confidence
 Ability to divide your time between work and study
 Meticulous attention to detail
 A strong aptitude for maths
 Excellent problem-solving skills
 A keen interest in the financial system
 Ability to work to deadlines, under pressure
 Ability to work on your own initiative and as part of a team
 Strong IT skills
 Excellent interpersonal and communication skills, including good presentation and
report writing skills

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Auditors
Auditors are specialists who review the accounts of companies and organizations to
ensure the validity and legality of their financial records. They can also act in an advisory
role to recommend possible risk aversion measures and cost savings that could be made.
Auditors work in the accounting departments of a huge range of firms and with independent
chartered and certified firms, examining the money going in and out of organizations and
making sure it is recorded and processed correctly.
 collating, checking and analyzing spreadsheet data
 examining company accounts and financial control systems
 gauging levels of financial risk within organizations
 checking that financial reports and records are accurate and reliable
 ensuring that assets are safeguarded
 identifying if and where processes are not working as they should and advising on
changes to be made
 preparing reports, commentaries and financial statements
 liaising with managerial staff and presenting findings and recommendations
 ensuring procedures, policies, legislation and regulations are correctly followed and
complied with
 Undertaking reviews of wages.

Auditors work typical office hours from 9.00 am to 5.00 pm, Monday to Friday. They may
need to work extra hours or during the weekend to meet deadlines, particularly during tax
audits. Auditors sometimes travel to meet clients and visit factory or warehouse locations in order to
make stock and equipment checks.
INTERNAL AUDITORS
 Work for professional firms outsourced by client companies
 Work in-house as part of an organization’s accounting team
 Work for large private companies, organizations and charities.

Internal auditors work largely in the private sector to improve the efficiency of businesses
and identify where processes are not working as they should. As well as reviewing financial
accounts, they also look at aspects of the company such as ethics, environmental
sustainability, reputation and growth.

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EXTERNAL AUDITORS

 Work with private firms of accountants, or in the public sector for the National Audit
Office
 Carry out obligatory audits of the public sector and governmental bodies
 May be called to examine the finances of private businesses, especially those working
in association with governmental bodies.
External auditors play a vital role in ensuring that money raised by taxes is used effectively
and efficiently.
SKILLS FOR AUDITORS
 Self-motivation, determination and confidence
 Ability to divide your time between work and study
 Meticulous attention to detail
 A strong aptitude for maths
 Excellent problem-solving skills
 A keen interest in the financial system
 Ability to work to deadlines, under pressure
 Ability to work on your own initiative and as part of a team
 Strong IT skills
 Excellent interpersonal and communication skills, including good presentation and
report writing skills

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Auditors
Auditors are specialists who review the accounts of companies and organizations to
ensure the validity and legality of their financial records. They can also act in an advisory
role to recommend possible risk aversion measures and cost savings that could be made.
Auditors work in the accounting departments of a huge range of firms and with independent
chartered and certified firms, examining the money going in and out of organizations and
making sure it is recorded and processed correctly.
 collating, checking and analyzing spreadsheet data
 examining company accounts and financial control systems
 gauging levels of financial risk within organizations
 checking that financial reports and records are accurate and reliable
 ensuring that assets are safeguarded
 identifying if and where processes are not working as they should and advising on
changes to be made
 preparing reports, commentaries and financial statements
 liaising with managerial staff and presenting findings and recommendations
 ensuring procedures, policies, legislation and regulations are correctly followed and
complied with
 Undertaking reviews of wages.

Auditors work typical office hours from 9.00 am to 5.00 pm, Monday to Friday. They may
need to work extra hours or during the weekend to meet deadlines, particularly during tax
audits. Auditors sometimes travel to meet clients and visit factory or warehouse locations in order to
make stock and equipment checks.
INTERNAL AUDITORS
 Work for professional firms outsourced by client companies
 Work in-house as part of an organization’s accounting team
 Work for large private companies, organizations and charities.

Internal auditors work largely in the private sector to improve the efficiency of businesses
and identify where processes are not working as they should. As well as reviewing financial
accounts, they also look at aspects of the company such as ethics, environmental
sustainability, reputation and growth.

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EXTERNAL AUDITORS

 Work with private firms of accountants, or in the public sector for the National Audit
Office
 Carry out obligatory audits of the public sector and governmental bodies
 May be called to examine the finances of private businesses, especially those working
in association with governmental bodies.
External auditors play a vital role in ensuring that money raised by taxes is used effectively
and efficiently.
SKILLS FOR AUDITORS
 Self-motivation, determination and confidence
 Ability to divide your time between work and study
 Meticulous attention to detail
 A strong aptitude for maths
 Excellent problem-solving skills
 A keen interest in the financial system
 Ability to work to deadlines, under pressure
 Ability to work on your own initiative and as part of a team
 Strong IT skills
 Excellent interpersonal and communication skills, including good presentation and
report writing skills

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CHAPTER-IV

4.1 INTRODUCTION OF AUDITING

The audit provides an opportunity to uncover the issues, concerns and challenges
encountered in the execution of a project. It affords the project manager, project sponsor and
project team an interim view of what has gone well and what needs to be improved with the
project to successfully complete it. If done at the close of a project, a project audit can be
used to develop success criteria for future projects by providing a forensic review. This
review will provide an opportunity to learn what elements of the project were successfully
managed and which ones presented some challenges. This will help the organization identify
what it needs to do so that mistakes are not repeated on future projects.
Regardless of whether the project audit is conducted mid-term on a project or at its
conclusion, the process is similar. It is generally recommended that an outside facilitator
conduct the project audit. This ensures confidentiality but also provides the team members
and other stakeholders with the opportunity to be candid. They know that their input will be
valued and the final report will not identify individual names, rather it will only include facts.
It is common that individuals interviewed during the project audit of a particularly badly
managed project will find speaking with an outside facilitator provides them with the
opportunity to express their emotions and feelings about their involvement in the project
and/or the impact the project has had on them. This “venting” is an important part of the
overall audit.
Internal audit is the independent appraisal of activity within an organization for the
review of accounting, financial and other business practices as a protective and constructive
arm of management. It is a type of control, which functions by measuring and evaluating the
effectiveness of the other type of controls.

Auditing Procedure

An audit planning i.e. an audit plans relating to extent and scope of an audit.

Developing the audit programmer i.e. the procedure that are needed to implement the audit
plan.

 Examination of the accounting system


 Evaluation of internal controls

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 Simple checking of vouchers
 Verification of assets and liabilities
 Submission of auditor reports

4.2 TAX
INTRODUCION
 Ensure proper maintenance and correctness of books of accounts and certification of
the same by tax auditor
 Reporting of observations/discrepancies noted by tax auditor after a methodical
examination of books of account
 Reporting prescribed information such as tax depreciation, compliance of various
provisions of income tax law etc. This in turn enables and also saves time of tax
authorities in verifying the correctness of income tax return filed by the taxpayer such
as total income, claim for deductions etc.
4.3 INCOME TAX
Income tax is the major source of revenue collection by C.B.R income tax
departments is responsible in the country for the collection of income tax law provides
guideline for the proper administration of the whole system.

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4.4 SALES TAX
A Sales tax is imposed on the sales of goods and services, it is collected by the retailer
at the point of sales and is computed on a fixed percentage of the retail price. Sales tax
department, which comes under the central Board of Revenue, is responsible for the
collection of sales tax under the sales tax Act 1990.
Every person or entity ho makes a taxable supply in India in the course of any taxable
activity carried out by him and whose total turnover from taxable supplies made in any period
exceeds Rs. 2.5 million in case of manufactures and Rs. 5 million in case of retailers.

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CHAPTER-V
CONCLUSION
The purpose of a project audit is to identify “Lessons Learned” that can help improve the
performance of a project or to improve the performance of future projects by undertaking a
forensic review to uncover problems to be avoided. In this way, project audits are highly
beneficial to the organization and provide the following multitude of outcomes:

 Development of “Lessons Learned” on the project that can be applied to both the
organization and its vendors.
 Development of strategies, which if implemented within the organization, will
increase the likelihood of future projects and change initiatives being managed
successfully.
 Development of project success criteria which might include on-time, on-budget,
meeting customer and other stakeholder requirements, transition to next phase
successfully executed, etc.
 Recognition of risk management so that risk assessment and the development of
associated contingency plans becomes commonplace within the organization.
 Development of change management success criteria which might include how staff
are involved, how customers are impacted, how the organization is impacted,
transition to next level of change to be initiated, etc.
 Development of criteria that will continue the improvement of relationships between
the organization and its vendors, suppliers and contractors regarding the management
of projects.
 Identification of the Lessons Learned on the project that can be applied to future
projects within the organization.

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