Corporate Audit

Prof. GURU PRASAD

FACULTY MEMBER
INC GUNTUR
pgp4149@gmail.com
 Corporate Audit
• Auditing is systematic and independent examination of
data, statements, records,operations and performances.
• Audit is an independent examination of financial
information of an entity, whether profit oriented or not,
and irrespective of its size or legal form, when such
examination is conducted with a view to expressing an
opinion thereon.
• Objective of corporate audit is :
4. To express an opinion on the “True and Fair” view of
financial statements.
5. To exercise due care and skill in detection of material
errors and frauds, in circumstances which arouse his
suspicion.
 Audit process

• Audit process refers to sequence of activities performed in the

formulation of audit opinion on the financial statements. It
involves the following:
2. Formulating audit plan.
3. Evaluation of internal control.
4. Examination of books of accounts
5. Vouching.
6. Compliance verification,
7. Overall tests and analytical reviews.
8. Financial statements scrutiny.
 What audit can do?

• Identify opportunities for improvement.

• Reality checks
• Identify outdated strategies
• Measure performance improvements.
• Increase management’s ability to address
concerns.
• Increase team work.
• Increase people’s commitment to change.
 Audit tools and Techniques

• Surveys: It is gathering factual data from a large

population which is inexpensive and consistent.
• Questionnaire: Gathering information covering
small samples.
• Focus Groups: IT is means for gathering in-
depth data on specific topic.
• Unstructured interviews: It allows to “ Get
inside the heads” of informants.
 Other audit techniques
• Check of posting
• Check of casting
• Physical examination and count
• Confirmation
• Inquiry
• Year-end scrutiny
• Re-computation
• Tracing in subsequent period
• Bank reconciliation
• Analytical Review procedure and ratio analysis.