Advanced Auditing, Assurance and Professional Ethics - November 2023

(a) SS Ltd. is a company listed in India. The Company has appointed M/s Z & Co. as auditors. Mr. Q, a CA has recently joined the firm and has been appointed as the engagement partner for the first time. He understands that it is necessary to ensure the compliance of independence for the audit team as per standard audit practices. But he could not find as such, any policies and procedures available with the firm in documented form. Why…

(a) PQR Ltd. supplies uniforms across the country. The company has 4 warehouses at different locations throughout India and 5 warehouses at the borders. The major stocks are generally supplied from the borders. PQR Ltd. appointed M/s STU & Co. to conduct its audit for the financial year 2022-23. Mr. U, partner of M/s STU & Co., attended all the physical inventory counting conducted throughout India, but could not attend the same at borders due to some unavoidable reasons. You…

While doing Tax Audit, under section 44AB of the Income-tax Act, 1961, of the accounts of Gum Private Limited for the Assessment Year 2023-24, it was found that during the Financial Year 2022-23, Gum Private Limited had received 8,000 shares, the market value of which was # 80,000 on the date of transfer, at a price of ¢ 45,000 from Paste Private Limited. The Management of Gum Private Limited maintained that the transaction was as per the terms of negotiations…

(a) CA. Honest is the statutory auditor of Wax Ltd., which is a company listed in India with a turnover of % 2500 Crore as per latest financial statements. CA. Honest is the auditor of the company since last 3 years. During the year 2021-22, Company has changed its CFO. The newly appointed CFO is not much happy with CA. Honest due to his strict audit procedures as well as his harsh comments in the review reports. He always tries…

(a) Sonar Limited is a public sector undertaking engaged in production of electricity from solar power. It had commissioned a new project near Mumbai with new technology for a cost of ® 4,750 Crore. The project had seen delays in commencement and cost overruns. State ANY FIVE matters that a Comprehensive Audit by C & AG may cover in reporting on the performance and efficiency of this project. (5 Marks) (b) CA. T was appointed as a Technical Reviewer of…

(a) Explain the provisions and requirements of the Companies Act, 2013 for preparation and Consolidation of Financial Statements of a company which is mandatory. Also, state in which cases the requirement related to preparation of consolidated financial statements shall not apply to a company. (5 Marks) @ The Institute of Chartered Accountants of India (b) P Ltd has more than one subsidiary where Mr. K and Mr. X are interested. K and X are also directors in P Ltd. These…