Executive Summary

This report titled "A study on audit procedure . A Case Study on KSPCB” is an outcome of BBA
internship program. Such programs facilitate us to apply our understanding of the theoretical
knowledge in the practical field. This report contains the details of the audit procedure followed by
KSPCB. KSPCB- as my first experience to professional World. In this way KSPCB has enriched its
professional base for serving the clients interest in best manner. In these four weeks internship
program, I was allocated in the accounting section an Audit staffs. I have worked in this report
followed by the knowledge that I have gained from working, trainings and my personal experiences.
The first part of the report consist a study background of the project. The second part of the report
contains of organization's profile of KSPCB. . In the third part I have tried to discuss about literature
review of the audit procedure in India and in the sub-division of third part about the audit
procedures followed by KSPCB in details. In the fourth part the client's audit procedure & I have
introduced my learning in the sixth part. Followed by this in the next sections I have tried my best to
include my recommendations from my point of view to carry out audit procedure of KSPCB and to
minimize such problems. In part eight, I have drawn an overall conclusion.
 INTRODUCTION
In today's world academic education is not adequate to enable a student to compete with
confidence and reach his/her goal without having experience with the outside world. In order to
have an idea and gain experiences, we, the students of Faculty of management, Government college
for women’s kolar .have to undertake 15 days internship program at any organization. As a part of my
BBA Program, the 15 days internship program gave me the opportunity to have a practical knowledge
on auditing procedure. The assignment was how a chartered accountancy firm performs an audit and
also to gain a knowledge and practical experience on how audit work is performed in corporations,
companies and non-profit making organizations. To face much more complex and challenging
business world in the challenging business areas, practical knowledge is essential to expand our
theoretical base. To gather this practical knowledge.This study gave me an opportunity to observe
and perform real world knowledge about the audit procedure, which is followed by the Accountancy
section of the firm. In the internship period I could relate the theoretical knowledge of auditing to
practical exposure.

Origin of the Report

The internship program is mandatory requirement for the student who are graduating from the BBA
program under the faculty of Management of government college for women’s kolar. In the
internship program I was engaged in a host firm named KSPCB. 15 days period. I have learned how an
audit is conducted. I also learned about the audit procedures and how the engagement is done in
case of an annual audit. As a result I have decided to write a report about the audit procedures of
KSPCB from practical knowledge that I have observed.
OBJECTIVES OF THE STUDY
• To have an overall idea about the audit procedures of KSPCB

• To gain practical knowledge and experience on how KSPCB performs an audit and how audit work
is

performed in corporations, companies and non-profit making organizations.

• To identify about how to accumulate and process evidences to make an audit report.

SCOPE OF STUDY
I have been assigned in KSPCB that gave me tremendous scope to familiarize with the audit
procedure of the organization. Major parts of scope are point out below:

a) Background of the host organization and also their position.

b) Audit procedure, which is followed by the organization for performing any audit.

c) Nature and importance of it has depicted in this study.

d) Audit methodology of the firm, which is followed by the organization for performing any audit.

e) Audit administration of the firm, which is followed by the organization for performing any audit.
METHODOLOGY OF COLLECTION OF INFORMATION

In order to prepare the assigned project paper I have collected necessary information from two
types of source as follows:

1) Primary sources information.

2) Secondary sources information.

Primary sources information

1.I have collected primary information by working with two audit team

2. Discussing with engagement partner, audit manager, audit staff and articled student.

Secondary sources information

1.I have also collected secondary information like annual audit report, management audit report ,
accounting system & audit working papers

2. The information was obtained from various corresponding files of the firm.
LIMITATIONS OF THE STUDY

The study is conducted with an objective to make a thorough study of external audit procedure. I
have availed many facilities and faced some obstacles during my study. These obstacles may be
termed as limitation of the study. These limitations are as follows:

a) Scheduled time span was not sufficient to cover all information.

b) As an independent audit firm the information of the case study is not adequate for this study.

c) To some extend the exact audit procedure is not followed due to time and other constrains.

d) As the internship was the first practical experience, it was not possible for me to know all and
everything of audit procedure.
COMPANY PROFILE
INTRODUCTION
BOARD PROFILE:-

The Karnataka State Pollution Control Board for Prevention and Control of Water Pollution was
constituted by the Government of Karnataka on The Twenty First of September Nineteen Seventy
Four (21/09/1974) in pursuance of the Water (Prevention & Control of Pollution) Act, 1974. The
Water Act will provide for the prevention and control of water pollution and maintaining or restoring
of wholesomeness of water. After the enactment of the Air (Prevention & Control of Pollution) Act,
1981 the enforcing responsibility was entrusted to the above Board. As such, the Board was later
renamed as the Karnataka State Pollution Control Board in 1985. The Air (Prevention & Control of
Pollution) Act, 1981 is an enactment to provide for prevention, control and abatement of air
pollution.
 CONSTITUTION
The environmental Management Policy & Research tasuune (EMPRisan autonomous insure
established by Guvament of Karuuka on 17th September 2002 under the Department of Forest,
Ecology and Environment. The Destitute undertakes applied and policy suszarch and abe endeavor's
in provide capacity building trainings on concurrent environmental issues relevant to the society.
Services provided by the institute sock to encourage and enable goverment, industry and civil society
to safeguard and manage the natural resources effectively. It is registered under the Karnataka
Societies Rugistration Act 1960

GOVERNANCE
EMPRI functions under the direction of a Governing Body chaired by the Additional Chief Secretary,
Department of Forest, Ecology & Environment, Government of Karnataka. The Governing Body
consists of representatives of various Government departments and Government authorities
including Department of Forest, Ecology & Environment, Department of Urban Development,
Department of Industries & Commerce, Department of Health & Family Welfare, Department of
Finance, Central Pollution Control Board (CPCB) and Karnataka State Pollution Control Board (KSPCB).
The Director General (DG), EMPRI is the Member Secretary of the Governing Body. The DG being the
Chief Executive of the Institute is responsible for day-to-day administration of the organization,
supported by the officers deputed from the Government of Karnataka and personnel contracted for
specific purposes. GENERAL BODY: General Body is chaired by the Additional Chief Secretary,
Department of Forest, Ecology & Environment, and Government of Karnataka. The members of
Governing Body are also the members of General Body. The General Body meeting is convened every
year to consider and approve the Annual Administration Report, Audit Report, Income and
Expenditure Statement etc. It also approves the budget for the ensuing year.
 ORGANIZATION STRUCTURE
Board has its Central Office at Bengaluru The enforcement of the above mated Acts and Rules are
being implemented through Thiny Three Regional Offices. Eleves Regional Offices are operating in
Bengaluru City namely, Bengaluru City-1, Bengaluru City 2. Bengaluru City-3, Bengaluru South-1,
Bengaluru South 2. Bengaluru Nurth-1, Benga ณใหาง North-2. Bengaluru East-1. Bengaluru East-2,
Bengaluru Went and Peenys and one nach al Mysore, Mangalore, Hassan, Dharwad, Davangere,
Belgauts, Gulbarga, Raichur, Tumkur, Kolar, Mandya, Udupi, Karwar, Shimoga, Chitradurga, Bijapur,
Bidar, Bellary, Bagalkote, Chamanujanagar, Kopyal and Chickmagalur. The Central laboratory of the
Board le located at Bengaluru. Regional laboratories have been set up along with Regional Offices of
Mysore. Mangalore. Hasasan, Dharwad. Raichur, Duvunagere, Gulbarga and Belgaum.

The Central Office of the Board is responsible for making general policies relating to enforcement of
the above said Acts and Rules and it also carries out general administration and co-ordination with
other agencies. The Central Laboratory of the Board is well equipped and can take up analysis of
water, waste water, stack emission samples, ambient air samples, bioassay tests, bacteriological
analysis, etc,

VISION:

The EMPRI's vision is to become a knowledge centre in inspiring and enabling society to create an
environment of harmony between man and nature.

MISSION:

1. To carry out research on current policy and environmental issues

2. To provide world class training and advisory services on environmental management and

3. To enable and encourage the civil society, the government and the industries to safeguard and
manage natural resources effectively.
OBJECTIVES:

1. To provide Capacity Building & Technical support to Government, NonGovernment & other
Institutions in addressing policy and environmental issues:
2. To provide Consultancy Services to Industries, Government Departments and other
organizations in the field of Environmental Management and
3. To take up studies and to develop policy documents on various environmental aspects.
 FUNCTIONS OF THE BOARD

 The Board has certain mandatory Functions for control of water and air pollution. The
Important functions of the Bound under Water (Prevemon and Control of Pollution) Act,
1974, and Air (Prevention and Control of Pollution) Act, 1981, (Seution 171 are To plan a
comprehensive programme for the prevention, control or abatement of pollution of
streams and wells in the State and to secure the execution thereof.
 To advise the State Government on any matter concerning the prevention, control or
abatement of water pollution and air pollution
 To collect and disseminate information relating to water pollution, air pollution and the
prevention, control or abatement thereof.
 To encourage, conduct and participate in investigations and research relating to
problem of water pollution and prevention, control or abatement of water pollution
 To inspect sewage or trade effluents, works and plants for the treatment of sewage and
trade effluents and to review plans, specifications or other data relating to plants setup
for the treatment of water, works for the purification thereof and the system for the
disposal of sewage or trade effluents or in connection with the grant of any consent as
required by this Act. Laydown, modify or annul effluent standards for the sewage and
trade effluents and for the quality of receiving waters (not being water in an inter-State
stream) resulting from the discharge of effluents and to classify waters of the State.
 To evolve economical and reliable methods of treatment of sewage and trade effluents,
having regard to the peculiar conditions of soils, climate and water resources of
different regions and more especially the prevailing flow characteristics of water in
streams and wells which render it impossible to attain even the minimum degree of
dilution
 To avalve methods of vilization of sewage and suitable trade efflurms in agricoles
 To evolve efficient methods of disposal of sewage and trade effluents on land, as aru
necessary on accoum of the predominant conditions of scant stream flows that do not
provide for major part of the year the minimum degree of dilution
 To laydown standards of effluents of sewage and trade effluents to be discharged into
any particular stream and the tolerance limits of pollution permissible in the water of
the stream, after the discharge of such effluents.
 To make, vary or revoke any order:
 For the prevention, control or abatement of discharges of waste into streams or wells.
 Requiring any person concerned to construct new systems for the disposal of sewage
and trude effluents or to modify, alter or extend any such existing system or to adopt
such remedial measures as are necessary to prevent control or abate water pollution.
 To laydown effluent standards to be complied with by persons while causing discharge
of sewage or sullage or both and to laydown, modify or annul effluent standards for the
sewage and trade effluents.
 To advise the State Government with respect to the location of any industry the carrying
on of which is likely to pollute a stream or well.
 To plan a comprehensive programme for the prevention, control or abatement of air
pollution and to secure the execution there of
 To inspect, at all reasonable times, any control equipment, industrial plant or
manufacturing process and to give, by order, such directions to such persons as it may
consider necessary to take steps for the prevention, control or abatement of air
pollution. To aspect air pollution control areas at such intervals as it may think
 necessary, an the quality of air therein and take steps for the prevention, control or
ahatement of air pollution in such areas,
 To laydown, in consultation with the Central Board and having regard to the standards
for the quality of air laid down by the Central Board, standards for emission of air
pollutants into the atmosphere from industrial plants and automobiles or for the
discharge of any air pollutant into the atmosphere from any other source whatsoever
not being a ship or an aircraft: Provided that different standards for emission may be
laid down under this clause for different industrial plants having regard to the quality
and composition of emission of air pollutants into the atmosphere from such industrial
plants.
 To advise the State Government with respect to the suitability of any premises or
location for carrying on any industry, which is likely to cause Air Pollution.
 To perform such other functions as may be prescribed or may, from time to time, be
entrusted to it by the Central Board or the State Government.
MAJOR ACTIVITIES OF THE KSPCB

TRAINING:

Capacity Building is a thrust area in EMPRI.The institute conducts need based training programmes
on various environment related issue. The Training modules include:-

 Environmental Conservation and Managenient (ECM);

 Boi-Medical Waste Management (BMW);
 Coastal Regulation Zone (CRZ);
 Solid Waste Management (SWM);
 Hazardous Waste Management;
 Rain Water Harvesting (RWH);
 E-waste Management;
 Sustainable Environmental Management etc,
 During the year 2017-18 Total 57 Trainings Workshops were conducted and 10,531
Participants were trained.

2) Information, Education and Communication Activities:-

Information, Education and Communication activities are essential to spread the message about
existing law, environmental protection, and pollution control. EMPRI aims at mass
communication to reach thousands of people at a time regarding significant environmental
issues in which general public are major stake holders. The activity for the year 2017-18
includes:

 Dance metaphor video- "Idolle Vichara";

 Documentaries,
 Mass SMS;
 Mass email;

3.Training Programme on Climate change;- Cimate change in affected by

 Energy:
 Waste;
 Agricultural and Forest Land Uses
4.2.4 Major Personality Attributes Influencing Organisational Behaviour

Following are the major personality traits (attributes) that influence behaviour at
workplace:
1) Self-Monitoring: Self-monitoring refers to the
degree to which people control the manner in which they display themselves in front of
other people. These people control their behaviour and follow the norms that are
socially acceptable and suitable. Such people are regarded as high self- monitors. They
put effort so that their behaviour is situationally appropriate. High self-monitors are
better skilled to customise their behaviours as per the situation. Hence, they can adjust
better in jobs like sales and consulting where interaction with different kind of people is
required.
2) Self-Esteem: People tend to feel proud about their competence and at times about
themselves. This kind of emotion is termed as self-esteem. The ones with high self-
esteem feel that they are competent and commendable enough to handle any kind of
situation. On the contrary, the ones with low self-esteem are always in doubt about
their abilities and knowledge. They are never sure about their true potential and are
always afraid that they would fail in life.
3) Need Patterns: There are several people who have immense desire to stand out by
performing difficult jobs and meet their own standards of perfection. They prefer taking
responsibility of challenging situations and then like to get a genuine feedback of the
entire effort. Such kinds of people are found in jobs which give them a chance to
quench their thirst for excellence.
4) Locus of Control: "Locus of control" was derived from Rotter's social learning theory.
As per this theory, locus of control is the common anticipation based оп association
between individual's character, his deeds and the result achieved. This concept is
derived from numerous specific encounters in which people identify the ped outcomes
of situations happening in their lives. Locus of control is a personality trait possessed by
people who believe that either internal or external factors are responsible for their
behaviour. Such individuals believe that the life's events are either under the person's
control (internal locus of control) or are due to reasons that are beyond the person's
control (external locus of control).
5) Authoritarianism: The main idea here is that within an organisation, there exists
difference in power and status among employees. A person who has an authoritarian
personality believes in enforcement and obedience of authority. He usually has negative
opinions about other people and is rationally inflexible. Authoritarians consider their
beliefs to be ethically supreme and give excessive importance to rules and regulations.
For such a person, a steady work environment governed by clear-cut norms is
preferred.
6) Machiavellianism: This defines the extent of practicality possessed by a person. Such
people are emotionally isolated and down to earth. People with a strong
machiavellianism personality are more influential and successful, but are less influenced
by others. Reverse happens with people having weak Machiavellianism personality.
Nevertheless, situational factors control high-mach results.
7) Introversion and Extraversion: These two expressions describe a person's socialising
abilities. Extroverts are expressive and friendly, whereas introverts are hesitant, silent
and reserved. It is also seen that both extroverts and introverts prefer different kinds of
careers and different kinds of organisational atmosphere to give their best.
8) Bureaucratic Personality: According to Merton, "Bureaucratic personality is the
outcome of bureaucratic characteristics in a person, such as impersonal attitude, etc. In
some cases such characteristic increases the extent of rudeness". For example, Aiken
and Hage stated that employees of organisations that promote bureaucratic structure
suffer from work resentment. In centralised and formalised organisation, the employees
do not get much chance to take part in decision-making process related to
organisational policies and delegation of duties. There are severe norms that are
imposed in such a hard manner that the employee becomes powerless. Therefore,
bureaucratic characteristics can be the cause of both. i.e.. a bureaucratic behaviour and
marginalisation of work.
9) Risk Taking: Certain people have the tendency to take risks while the others tend to
avoid it. This tendency determines the time managers take in making decisions and the
amount of information they need. Managers with high risk-taking tendencies take faster
decisions with less information. Managers are usually found to be risk- averse, though
these dimensions have their own individual differences.
10) Type A and Type B: Individuals with intolerant, competitive and hostile personalities
are termed as Type A whereas Type B personalities are stress- free, relaxed and casual
in nature.
10) Type A and Type B: Individuals with intolerant, competitive and hostile personalities
are termed as Type A whereas Type B personalities are stress- free, relaxed and casual
in nature.
Type A Personality
People with Type A personality appear to be in a state of hurry and eagerness. Such
people give priority to money and finances to such an extent that they believe that
even their relationships must depend on money. People with Type A personality give
more importance to their work as compared to their relationships. They are always
interested in doing something worthy: otherwise they will feel guilty of wasting their
time. The positive aspect of Type A personality is that such people are winners. Since
they give their best to every project, even if they are totally ignorant of the concept,
they accomplish the task successfully due to their competitive and adventurous nature.
They tend to set up a time-table for themselves and then stick to it. The most evident
trait of Type A personality is hostility and restlessness. Most of the times, they display
unfriendliness and impoliteness. Alternatively, they are highly motivated and are
positive thinkers.
Type B Personality
People with type B personality are totally opposite to Type A people. They are silent,
tolerant, relaxed and believe in doings things at their own pace. They tend to take up
things slowly, think before coming to any conclusion and might postpone work till the
last minute. They are the social people and like to interact with both friends and
strangers. They receive a lot of attention everywhere and are more comfort-seeking
than driven towards success while at work. They are kind, thoughtful and friendly and
114
have the talent of building strong relations and also strike a balance between work and
personal life. They usually lead a satisfied and happy life. They can also be portrayed as
bombers and human magnets who grab the attention wherever they go with minimum
effort. All these traits make Type B unique among all personality types.