presented by: ca uday sathaye gokhale & sathe chartered accountants certificate course on...

Presented by:

CA Uday Sathaye

Gokhale & Sathe

Chartered Accountants

EFFECTIVE CONCURRENT AUDIT REPORTING

Certificate course on Concurrent Audit of Banks

Audit Objectives:

As per SA 700 issued by ICAI:

Audit Objectives are :

a) To form an opinion on the Financial Statements

b) To draw conclusions based on Audit Evidence obtained

c) To clearly express the opinion through a Written Report

CA Uday Sathaye Gokhale & SatheChartered Accountants

Audit Report Stages

• Planning Stage

• Draft Report preparation Collection of data Discussion Final draft

• Revising the Draft Report


Who are the readers ?

1. Branch2. Compliance Department3. Controlling Office4. RBI5. Other Govt Agencies, etc.

An effective Audit Report should focus on its readers and should contain necessary details of Discrepancies Regulatory / Internal guidelines Risk associated, etc


Consideration of SIA 4 in Reporting

Title

• Appropriate

• Expressing nature of the Report

Addressee

Appropriately addressed

Report Distribution List

Mention of the recipients of the report


Coverage

Identify the systems, processes, functional lines or other items of the entity

Opening or introductory paragraph

• The operation of systems, procedures and controls are the responsibility of the entity’s management

• The responsibility of the internal auditor is to express an opinion

Scope paragraph

• Describe the scope of the internal audit

• Describe that the internal audit was conducted in accordance with generally accepted audit procedures as applicable.

Executive Summary paragraph

Indicate the highlights of the internal audit findings, key issues and observations of concern, significant controls lapses, failures or weaknesses in the systems or processes.


Observations paragraph

Mention the process name, significant observations, findings, analysis and comments of the internal auditor.

Comments from local management

• The observations and comments from the local management of the entity provided after giving due cognizance to the internal auditor’s comments

• Local management’s action plan or resolution of the issues and compliance to the internal auditor’s recommendations and suggestions

Action taken report

• Appended after the observations and findings

• It should include status of compliance / non-compliance w.r.t to previous internal audit observations and reasons for non-compliance thereof


Date, place & signature of the internal auditor• Signed by the internal auditor in his personal name• Membership No.

Communication to the Management• Discussion Draft

• Exit Meeting

• Formal Draft

• Final Report

Limitation on scope

• Describe the limitation


Report Writing

Use of Language in Reporting: Sentence Formation

Grammatical accuracy

Avoid use of biased language

Avoid use of Ambiguous Pronoun Reference

Avoid use of words like Generally, Mostly etc.

Use of too much technical words to be avoided

Use of Bullets

Answer each question and do not put symbols like -

Audit observations should be concise yet clear


Difference of opinion or understanding with Auditee should be

spelled out clearly

Clarity about views to be presented in Report

Emphasis should be at proper places only


Report Writing (Contd…)

General Guidelines for Report Format Selection of Font and consistency throughout the Report

(Including Annexures)

Margins

Spacing

Tabs

Page size

Header and footer

Date and Time Formats


Value Addition to Audit Report

Attachments / Annexures / Appendices

Executive Summary/Flash Report

Key Audit Findings

Sample Details

Revenue Leakage Statements


Conclusion of Audit Report

Review internally before submission of Final Report :

Discussion with Auditee and necessary correction thereafter

Stamping/Initials/Timing

Keep proper Attendance Record

Cover everything and issue Certificates appropriately Disclaimer should be properly given

Acknowledgment


CA Uday SathayeGokhale & Sathe

Chartered AccountantsEmail: [email protected]

presented by: ca uday sathaye gokhale & sathe chartered accountants certificate course on...

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