Nestle India Ltd.

STATUTORY
AUDIT
- Group 9
 WHAT IS AUDIT ?

Audit is the examination or inspection of various books of

accounts by an auditor followed by physical checking of
inventory to make sure that all departments are following
documented system of recording transactions. It is done
to ascertain the accuracy of financial statements provided
by the organisation.
WHO CAN PERFORM
AUDIT??
In India, chartered accountants
from ICAI or The Institute of
Chartered Accountants of India
can do independent audits of any
organisation. CPA or Certified
Public Accountant conducts
audits in USA.
WHAT IS A STATUTORY
AUDIT ???
 STATUTORY AUDIT
A statutory audit is a legally
required review of the accuracy
of a company's or government's
financial statements and
records. The purpose of a
statutory audit is to determine
whether an organization
provides a fair and accurate
representation of its financial
position by examining
information such as bank
balances, bookkeeping records,
and financial transactions.
 IMPORTANCE OF
STATUTORY AUDIT
IMPORTANCE OF STATUTORY
AUDIT
As per Companies Act 2013 and
Companies (Audit and Auditors)
Rules, 2014, all public and
private limited companies are
mandated by law (or stature) to
conduct a statutory audit of the
financial documents and filings.
In fact, the business turnover
and the nature of the business of
public and private limited
companies don’t matter in the
case of the statutory audit.
 OBJECTIVES OF
STATUTORY AUDIT
 OBJECTIVES OF
STATUTORY AUDIT
The main objectives of a statutory audit are to examine and
verify these documents of a business, which falls in the purview
of statutory audit:

GST checklist
Tax deduced at Source
Checklist
Other Verifications
HOW TO CALCULATE
STATUTORY AUDIT ?
 CALCULATION OF
STATUTORY AUDIT

At the start of the audit, the

auditing entity specifies which
records will be required as part
of the examination. The data is
obtained and provided when
demanded, allowing the auditors
to complete their analysis. If
inaccuracies are detected,
reasonable penalties may be
imposed.
 WHAT ARE THE ADVANTAGES AND
DISADVANTAGES OF STATUTORY AUDIT?
 ADVANTAGES OF STATUTORY AUDIT

Some of the advantages are:

The reporting quality of
the company.
chances of occurrence of
financial frauds
credibility of the financial
statements
Authenticity
DISADVANTAGES OF STATUTORY
AUDIT

Some of the disadvantages

are:
Inherent limitations to a
statutory audit.
No assurance .
Materiality audit basis,
DIFFERENT TYPES OF STATUTORY AUDIT
 FINANCIAL AUDIT AS PRESCRIBED UNDER
SECTION 139 OF THE COMPANIES ACT, 2013.

Sec 139 of the Companies Act

2013 provides that every
company shall appoint an
individual or firm as an auditor
of the company at the first
AGM. The person so appointed
shall hold the office from the
conclusion of the AGM in which
he was appointed till the
conclusion of the sixth AGM.
 COST AUDIT AS PRESCRIBED UNDER
SECTION 148 OF THE COMPANIES ACT, 2013.

Section 148 (2) empowers the

Central Government to direct,
based on the net worth or turnover
of the company, audit of cost
records of the specified class of
companies; ... In case the cost
auditor is in default, he shall be
punishable in the manner as
provided under section 147 (2) to
section 147 (4).
 SECRETARIAL AUDIT AS PRESCRIBED
UNDER SECTION 208 OF THE COMPANIES
ACT, 2013.
Secretarial Audit is an
independent, objective assurance
intended to add value and improve
an organization’s operations. It
helps to accomplish the
organization’s objectives by
bringing a systematic, disciplined
approach to evaluate and improve
the effectiveness of risk
management, control, and
governance processes.
 TAX AUDIT AS PRESCRIBED UNDER SECTION
44AB OF THE INCOME TAX ACT, 1961.

Section 44AB of the Income

Tax Act contains provisions
pertaining to the tax audit
under the Income Tax Audit. A
tax audit is an examination of
a taxpayer's books of accounts.
The examination is conducted
to ensure that the taxpayer
has properly maintained the
books of accounts and other
records.
GST AUDIT AS PRESCRIBED UNDER 35(5) OF
THE GST ACT, 2017.
.GST Audit scrapped section
35(5) from GST Act 2017
OMITTED /New Provisions for
Section 44 inserted Under
GST, the compliance
obligations under section 35(5)
from GST Act has been
removed to allow self-
certification. Section 35 of the
Central Goods and Services
Tax Act Sub Section (5) shall
be omitted.
 CONCLUSION

Statutory audit is one of the

main types of audits, required
legally to review the accuracy
of a company or government’s
financial accounts. It is
conducted to gather different
information so that the
auditor can give his opinion on
the true and fair view of the
company’s financial position
as on the balance sheet date.
REFERENCE :

https://www.educba.com/statutory-
audit/
https://audithow.com/statutory-audit/
https://www.msmex.in/learn/what-is-a-
statutory-audit/
BY GROUP 9

Naina Gupta 74052000328

Sejal Patil 74052000311
Palak Patel 74052000244
Samruddh Shetgoankar 74052000298
Sanyam Goyal 74052000230
Mehul Thilak 74052000297
Dhiraj Rahate 74052000071