DEPARTMENT OF COMMERCE(CA)
CLASS : III B.COM
SEMESTER : V
NAME OFTHEPAPER : AUDITING
PAPERCODE :
UNIVERSITY QUESTION PAPER PATTERN
Time: 3 Hours. Max. Marks: 75
PART A (15 x 1= 20 Marks)
(Answer All Questions)
1
,PART B (5 x 2 = 10 Marks)
(Answer Any 2 Questions)
PART C (3 x 10 = 30 Marks)
Answer All Questions
2
, a AUDITIN
G
A
SYLLABUS
Auditing meaning and objectives of audit difference between auditing and accountancy
kinds of audit advantages and limitations of audit audit programmes and working papers.
UNIT-II
Internal control meaning and object internal check meaning and object internal
control regarding cash, purchase, sales, payment of wages.
UNIT-III
Vouching meaning Objects Feature of good voucher Procedure and importance
vouching of cash transactions Verification of assets and liabilities.
UNIT-IV
Auditor qualification, appointment, dis-qualification, removal duties, power liabilities and
remuneration Share capital and share transfer of audit Audit Report Contents and types.
UNIT-V
Specialized audits, charitable institutions club, cinema theatre, educational institutions, hospital
hotel Electronic Data Processing Audit (EDPA).
Text books:
A text book of practical auditing B.N.Tandun
References books:
Auditing Dinker Pagare Sultan Chand and Sons New
Delhi
PracticalAuditing-
S.Vengadamani,MarghamPublication,Chennai.
3
, UNIT-I
Introduction:
In the early stages of civilization, the methods of maintaining accounts were very crude. Before
this era, individuals, on small scale, produced goods. There was not much capital. Each individual was
in a position to maintain his accounts and check for himself all his transactions. Hence, it was thought
to be a sheer waste of time and money to get the accounts checked by someone from outside.
But the expansion of banking facilities and new means of communication, have widened the
scope of investment and business in the 18th century. The investor would naturally like to see that his
investment is safe. For this purpose, the accounts must be checked and audited, especially in the case
of Joint-stock companies. As it is not possible for the shareholders to check the accounts of the
company, they appoint a person who would audit the accounts on their behalf.
Q. EXPLAIN THE MEANING & DEFINITION OF AUDIT.
Meaning of audit:
The word audit is derived from the Latin word audire which means, to hear. In olden
times, the owners of a business appointed certain persons to check the accounts whenever they
suspected fraud. Such persons sent for the accountants and heard whatever they had to say in
connection with the accounts.
Definition of auditing:
Spicer & Pegler - An audit may be said to be such an examination of the books, accounts and
vouchers of a business as will enable the auditor to satisfy that the balance sheet is properly drawn up,
so as to give a true and fair view of the profit or loss for the financial period according to the best of
the informations and the explanations given to him and as shown by the books, and if not in what
respects he is not satisfied.
Montgomery - Auditing is a systematic examination of the books and records of a business or
other organization, in order to ascertain or verify and to report upon the facts regarding its financial
operation and the result there of.
A.W.Hanson- An audit is an examination of such records to establish their reliability and the
reliability of statements drawn from them.
M.L.Shandilya- Auditing may be defined as inspecting, comparing, checking, reviewing,
vouching, ascertaining, scrutinizing, examining and verifying the books of accounts of a business
concern with a view to have a correct and true idea of its financial state of affairs .
Q. EXPLAIN THE OBJECTIVES OF AUDITING.
The main object of audit is to find out whether the accounts of particular concern show a true
and fair view of the earning and financial state of affairs.
Main objects:
The principal objects of auditing may be stated as follows;
i) Examination of books of accounts and records with a view to test the arithmetical accuracy and
correctness in recording of transactions and their reliability.
ii) Verify that the balance sheet and profit & loss account are drawn in conformity with the books of
accounts and records.
iii) Ascertain that proper accounting principles and procedures and management policies are followed.
iv) Ensure that books of accounts and records as required by law are kept.
v) Report on the balance sheet as to whether it reflects the true and fair state of affairs of the business
and that the profit and loss shows the correct profit and loss of the business.
vi) Inspect all the documents, records and books of accounts of the business and express opinion on
matters required by the statutes.
Thus the main object of auditing is to form an independent judgments and opinion about the
reliability of accounting records and true and fair view of financial state of affairs and working results.
4
CLASS : III B.COM
SEMESTER : V
NAME OFTHEPAPER : AUDITING
PAPERCODE :
UNIVERSITY QUESTION PAPER PATTERN
Time: 3 Hours. Max. Marks: 75
PART A (15 x 1= 20 Marks)
(Answer All Questions)
1
,PART B (5 x 2 = 10 Marks)
(Answer Any 2 Questions)
PART C (3 x 10 = 30 Marks)
Answer All Questions
2
, a AUDITIN
G
A
SYLLABUS
Auditing meaning and objectives of audit difference between auditing and accountancy
kinds of audit advantages and limitations of audit audit programmes and working papers.
UNIT-II
Internal control meaning and object internal check meaning and object internal
control regarding cash, purchase, sales, payment of wages.
UNIT-III
Vouching meaning Objects Feature of good voucher Procedure and importance
vouching of cash transactions Verification of assets and liabilities.
UNIT-IV
Auditor qualification, appointment, dis-qualification, removal duties, power liabilities and
remuneration Share capital and share transfer of audit Audit Report Contents and types.
UNIT-V
Specialized audits, charitable institutions club, cinema theatre, educational institutions, hospital
hotel Electronic Data Processing Audit (EDPA).
Text books:
A text book of practical auditing B.N.Tandun
References books:
Auditing Dinker Pagare Sultan Chand and Sons New
Delhi
PracticalAuditing-
S.Vengadamani,MarghamPublication,Chennai.
3
, UNIT-I
Introduction:
In the early stages of civilization, the methods of maintaining accounts were very crude. Before
this era, individuals, on small scale, produced goods. There was not much capital. Each individual was
in a position to maintain his accounts and check for himself all his transactions. Hence, it was thought
to be a sheer waste of time and money to get the accounts checked by someone from outside.
But the expansion of banking facilities and new means of communication, have widened the
scope of investment and business in the 18th century. The investor would naturally like to see that his
investment is safe. For this purpose, the accounts must be checked and audited, especially in the case
of Joint-stock companies. As it is not possible for the shareholders to check the accounts of the
company, they appoint a person who would audit the accounts on their behalf.
Q. EXPLAIN THE MEANING & DEFINITION OF AUDIT.
Meaning of audit:
The word audit is derived from the Latin word audire which means, to hear. In olden
times, the owners of a business appointed certain persons to check the accounts whenever they
suspected fraud. Such persons sent for the accountants and heard whatever they had to say in
connection with the accounts.
Definition of auditing:
Spicer & Pegler - An audit may be said to be such an examination of the books, accounts and
vouchers of a business as will enable the auditor to satisfy that the balance sheet is properly drawn up,
so as to give a true and fair view of the profit or loss for the financial period according to the best of
the informations and the explanations given to him and as shown by the books, and if not in what
respects he is not satisfied.
Montgomery - Auditing is a systematic examination of the books and records of a business or
other organization, in order to ascertain or verify and to report upon the facts regarding its financial
operation and the result there of.
A.W.Hanson- An audit is an examination of such records to establish their reliability and the
reliability of statements drawn from them.
M.L.Shandilya- Auditing may be defined as inspecting, comparing, checking, reviewing,
vouching, ascertaining, scrutinizing, examining and verifying the books of accounts of a business
concern with a view to have a correct and true idea of its financial state of affairs .
Q. EXPLAIN THE OBJECTIVES OF AUDITING.
The main object of audit is to find out whether the accounts of particular concern show a true
and fair view of the earning and financial state of affairs.
Main objects:
The principal objects of auditing may be stated as follows;
i) Examination of books of accounts and records with a view to test the arithmetical accuracy and
correctness in recording of transactions and their reliability.
ii) Verify that the balance sheet and profit & loss account are drawn in conformity with the books of
accounts and records.
iii) Ascertain that proper accounting principles and procedures and management policies are followed.
iv) Ensure that books of accounts and records as required by law are kept.
v) Report on the balance sheet as to whether it reflects the true and fair state of affairs of the business
and that the profit and loss shows the correct profit and loss of the business.
vi) Inspect all the documents, records and books of accounts of the business and express opinion on
matters required by the statutes.
Thus the main object of auditing is to form an independent judgments and opinion about the
reliability of accounting records and true and fair view of financial state of affairs and working results.
4
