International Islamic University Chittagong Dhaka Campus Group – C Md. Mehedi Hasan B081501 Md. Badrul Alam B081502 Md. Wali Ullah Rifat B081516 Md. Masum Billah B081560 Md. Tarekur Rahman B071705
Principles & Practices of Auditing Advantages of Audit Classifications of Audit Distinction between Continuous & Interim Audit Internal Audit vs External Audit
Md. Shaheb Ali MondalAsst. ProfessorBachelors of Business Administration Dept.International Islamic University ChittagongDhaka Campus
What is an Audit An audit is an accounting procedure under which the financial records of a company or individual are closely inspected to make sure that they are accurate. The Main Purpose One of the main purposes of the auditor’s report is to ensure that the finances of the company, both the Accounts Payable and the Accounts Receivable, are being conducted in a manner that is in keeping with legal requirements.
Advantages To Business Advantages To The Public Advantages To The State
1. Satisfaction of Owner2. Detection and Prevention of Errors3. Verification of Books4. Independent Opinion5. Detection and Prevention of Frauds6. Moral Check7. Protection of the Rights and Interests of Shareholders
8. Reliance by Outsiders9. Loan Facility10. Easy Valuation11. Upto Date Record12. Reliance by Partners13. Reliance by Shareholders
1. Safety from Exploitation2. Facility for Prospective Investor3. Satisfaction about Business Operations
1. Privatization of Industries2. Easy Assessment of Tax3. Quick Recovery of Taxes4. Leading to Economic Progress
Audit Legislative Relation of Periodicity Subject Matter Coverage Manner of Control Auditor Checking vis to vis Continuous Financial Audit Complete AuditStatutory Audit Management Audit Standard Audit Operational Partial Audit Interim Audit Audit Balance Sheet Government External Audit Audit Periodical Audit Cost Audit Audit Internal Audit Occasional Management Post & Vouch Private Audit Audit Audit Audit
Factors Continuous Audit Interim AuditDefinition An audit which involves a detailed examination An audit, which is, conducted between the of the books of account of regular intervals is two periodical or balance sheet auditors known as continuous audit i.e. one month or three month.Objective To know profit or loss is not necessary. To find the profit or loss is important.Audit Date The work of audit is carried on up to any date The work of audit is carried on up to a according to the convenience of the auditor and definite date according to the instructions his client. of the client.Verification Assets & Liabilities are verified after the balance Assets & Liabilities are verified when suchof Assets & sheet has been prepared an audit is conductedLiabilitiesTrail No need to prepare Has to be prepared or checkedbalancepreparationOrganizatio It is applied in big organization. It is applied in all type of organizations.n size
Internal Auditing External AuditingIt provides the information to owner of Main purpose of external audit is to giveCo. and management only. the information of internal as well as external i.e. owner, government etc.Employee under the direct control of This audit is made by the registeredmanagement does internal audit. auditorInternal auditor is fully related to External auditor is free from managementmanagementIt is continuous nature It is conducted periodicallyInternal auditor may or may not have In all case of statutory audit, auditor mustprofessional qualification have professional qualifications.