CA Inter Audit Lec 51 & 52

CA2.5

Bright and Smart Private Limited will be required, according to the provisions of Companies Act, 2013 to appoint an internal auditor only if the turnover during the preceding financial year would be:

• a) Less than or equal to ` 200 crore.

• b) More than or equal to ` 200 crore.

• c) Less than or equal to ` 150 crore.

• d) More than or equal to ` 150 crore

CA2.6

Latest and Vibrant Limited is an unlisted public limited company. For the above mentioned company, it will be required to appoint an internal auditor according to the provisions of Companies Act, 2013 only when during the preceding financial year, the paid up share capital of the company would be:

• a) Less than or equal to ` 50 crore.

• b)  More than or equal to ` 50 crore.

• c) Less than or equal to ` 100 crore.

• d) More than or equal to ` 100 crore.

299.2

To jointly audit books of accounts of WZ Limited for the financial year 2020-21 two different firms of Chartered Accountants namely MH and Associates and NR and Associates were appointed. MH and Associates and NR and Associates can together be called as:

• a) Principal Auditors of WZ Limited

• b) Branch Auditors of WZ Limited.

• c) Individual Auditors of WZ Limited.

• d) Joint Auditors of WZ Limited.

299.1

Which of the following is not an advantage Joint Audit:

• a) Sharing of expertise.

• b) General superiority complexes of some auditors.

• c) Lower workload.

• d) Displacement of the auditor of the company taken over in a take - over often obviated.

299.03

Which of the following is correct, in case of joint audit, where there is disagreement with regard to the opinion or any matters to be covered by the audit report.

• a) The auditors shall express their opinion in separate audit report.

• b)  The audit report(s) issued by the joint auditor(s) shall make a reference to each other’s audit report(s).

• c) Both (a) and (b) are correct

• d)   The auditor who is having a separate opinion is bound by the opinion of the majority of the  auditors and needs to issue a common audit report.

300.3

Planning an audit involves establishing the overall audit strategy for the engagement and

• a) developing an audit plan.

• b) developing an audit program

• c) developing detailed strategy

• d) any of the above

300.5

Planning an audit involves

• a) establishing the overall audit strategy for the engagement and developing an audit plan.

• b) establishing the overall audit plan for the engagement and developing an audit strategy.

• c)  establishing the overall audit plan for the engagement

• d) developing an audit strategy.

300.7

The audit plan is _______detailed than the overall audit strategy

• a) Less

• b)  More

• Equal

300.9

The overall audit strategy and the audit plan remain the ______ responsibility.

• a) auditor's

• b) management's

• c) those charge with governance's

• d) All of the above

Incs.31.4

Mr Ram and Mr Sham (two partners of ARG & Associates) differ on an audit point relating to audit of Sigma Ltd. Mr Ram is of the view that it will attract qualification however Mr Sham disagreed with his opinion. 

Based on above facts, you are required to answer below questions which require special attention while preparing the Audit report of Sigma Ltd."

"Assume Mr Ram and Mr Sham from two different joint auditor’s firms. How audit report should be made in circumstances where two joint auditors have difference of opinion in relation to a specific issue -

• a) The view of Mr Ram will prevail because of prudence

• b) Joint Auditors should come at a common point and give opinion accordingly

• c) The matter should be referred to a senior joint auditor firm

• d) Mr Ram and Mr Sham would issue separate audit reports"