This document provides an overview of various topics related to auditing including professional ethics, audit concepts, electronic data processing, group accounts, and non-financial audits. It discusses how professional ethics establishes standards of conduct for professionals. It defines an audit and covers audit independence, the audit committee, and controls in electronic data processing environments. It also addresses special considerations for auditing group accounts and types of non-financial audits.

2. CONTENTS
 Professional Ethics
 Audit & Concept
 Electronic Data Processing
 Group accounts
 Non Financial Audit

3. Ethics
Ethics is designed to educate people, to help
them to behave properly with others, to
communicate at the workplace,
etc. Professional ethics taught to follow the
measurement standards of morality, adopted
in order to regulate human behavior. These
are the standards employees must navigate.
Aligning themselves to these values, an
employee should cultivate the appropriate
personal qualities.

4. PROFESSIONAL ETHICS
Professional Ethics are a set of moral principles
and standards of conduct, supporting the moral
prestige of professional groups in society. The
tasks of professional ethics are to identify moral
standards and assessments, judgments and
concepts, characterizing people as
representatives of a particular profession.
Professional ethics develops norms, standards,
requirements, typical to certain activities.

5. The main types of professional ethics are:
Medical Ethics, Educational Ethics, Scholar
Ethics, Entrepreneur Ethics, Engineer Ethics,
etc. Each kind of professional ethics is
determined by the peculiarity of professional
activity, has its own specific requirements in the
field of morality.
For example, the ethics of a scientist involves
first such moral values as academic integrity,
personal integrity, and of course patriotism.

6. Fundamental Principles of
Professional Ethics
 Integrity
 Objectivity
 Confidentiality
 Technical standards
 Professional behavior

7. PROFESSIONAL ETHICS OF AUDITORS
Ethics means treating of morality or duty
on the fundamental principles. Integrity
or, the science of morals or the principles
of morality. Actually an ethical guide
known as the Rules of Professional
Conduct or the Rules. It is applicable to
all members of the Association, Whether
in public practice or not.

8. PROFESSIONAL ETHICS OF AUDITORS
Ethics means treating of morality or duty
on the fundamental principles. Integrity
or, the science of morals or the principles
of morality. Actually an ethical guide
known as the Rules of Professional
Conduct or the Rules. It is applicable to
all members of the Association, Whether
in public practice or not.

9. ETHICS OF AUDITORS
 The fundamental principle
 Integrity, objectivity and
independence
 Confidentiality
 Charged in professional
appointment
 Fees
 Ownership of books and papers
 Conflicts of interest

10. The fundamental principle
T.F.P cover the following matters:
1. Integrity
2. Objectivity
3. Competence
4. Skill, care, diligence
5. Courtesy and consideration
Integrity, objectivity and independence:
The basic principles of independence states that a members
objectivity must be beyond question if they are to repost as auditor.
So, Auditor independence is currently a hot topic within the professions
and will be ore of the mains priorities for the Accountancy
Foundation

11. Principles followed in the conduct of
audit
1. Integrity, objectivity, and independence:
The auditor has to reflect integrity, objectivity and
independence in his professional activities. He must be free
and neutral in nature.
2. confidentiality.
There must have an ultimate confidentiality about the
accumulated documents by the auditor.
3 skills and competence;
. The auditor must have general education and specialised
education. He must have practical knowledge regarding
auditing.
4.work performed by others
If the work of the auditor is performed by others,then he
must be sure about the accuracy of that perform work

12. 5.Prepare document:
the auditor should prepare documents to ensure that
the work done by him is followed the main principles
of the organization.
6.Planing:
For the accuracy of the work the auditor should make
a proper plan regarding his work. That means he
should make a serial of his work.
7. Accounting system and internal control:
If there is a proper internal control system on the
basis of the area and nature of the organization, it
will be helpful for the auditor to aid in his work.
8. Audit conclusion and report:
Finally the auditor will give his opinion regarding the
activities of the concerned whether it is fruitful or
not. And these will be on the basis of evidence.

13. Audit
The general definition of an audit is an evaluation of a
person, organization, system, process, enterprise,
project or product. The term most commonly refers
to audits in accounting, but similar concepts also
exist in project management, quality management,
and energy conservation.

14. An audit may be:
 The financial statements,
 Schedule of expenditures by federal award,
 Major program compliance with laws,
regulations and grant agreement &
 Internal controls over major program
compliance.

15. Concept
 The concept of auditing is seen as
something relating to verifying the
accounts or checking on workers and
making sure that assets exist and are
protected by contingency plans. So
auditing may be associated with
periodic reviews made by external
checkers – something to be suffered in
silence.

16.  One thing for sure is that auditing is regarded
as nothing at all to do with managing. It is
something that is ‘done’ to managers.
Meanwhile, the members of the in-house
audit team spend most of their time
explaining their role and trying to convince
everyone they meet that their work is
important

17. Audit independence
In terms of independence there are many
provisions that have entered the statute
books to try to stop past problems where
auditors had an obvious conflict of interest
that affected the veracity of their work.
There are restrictions on what other non-
audit services may be offered by an
external auditor.

18. such as those relating to:
 systems design or line functions;
 bookkeeping;
 recruiting managers;
 internal audit;
 tax planning.

19. Audit committee
• An audit committee consists
generally of non-executive directors.
The main objective is to establish an
effective link between the board of
directors and management team
which is involved with day to day
operations of the company, specially
with regard to control and auditing
matters.

20. Reviewing management letter received
from the auditor and making
recommendations on it.
Appraising the company accounting
policies.
Identifying areas of improving audit
efficiency.
Reviewing internal audit reports of a
company.
Resolving any possible conflicts between
the directors and the company.

21. Electronic Data Processing
Electronic Data Processing (EDP) refers to the use of
automated measures using simple, repetitive actions
- and computer technology - to organize and store
documents and sometimes to transfer them from
paper to a digital format. Electronic Data
Processing (EDP) can refer to the use of automated
methods to process commercial data. Typically, this
uses relatively simple, repetitive activities to process
large volumes of similar information. EDP (electronic
data processing) is the processing of Data by a
computer and its programs in an environment
involving electronic communication.

22. For example, stock updates applied to an
inventory, banking transactions applied to
account and customer master files, booking and
ticketing transactions to an airline's reservation
system, billing for utility services.
According to Business Dictionary, Electronic
Data Processing is the use
of computers in recording, classifying,
manipulating, and summarizing data.

23. Auditing in an EDP Environment
 Review of internal control:
The auditor should bring to bear upon his duties the basic
principles connected with compliance substantive tests. The
auditor should use various techniques like Flow charting,
discussion with the staff, questionnaire, test-checking etc. to
ensure that-there exists adequate and appropriate internal
control in the entity; it actually functions in the entity during
the period under the review.

24.  Examination of records produced by the system:
The auditing in an EDP environment may be carried
out by auditing around the computer or auditing
through the computer. Auditing around the computer
means the carrying out of audit in a traditional manner
by comparing the point-outs generated in the system.
The auditing through computer makes use of computer
in auditing.

25. Problems in an EDP Environment
 Absence of supporting vouchers
 Vulnerability to manipulations
 Shortage problem
 Coding problem
 Computer frauds
 Computer virus

26. Control in EDP Environment
 Division of responsibilities
 Control over operators
 Data access and programmed access
 Control over editing
 Storage control
 Control over functioning of equipment

27. Application Controls
• Control over input
• Control over processing
• Control over output

28. Design and Procedural
Aspects
 Consistency of performance
 Programmed control procedures
 Single transaction update of multiple or
data base computer files
 Systems generated transactions
 Vulnerability of data and program
storage media

29. Organizational Structure
 Concentration of functions and
knowledge
 Concentration of programs and data

30. EDP in the Modern Era
While the term EDP itself may be regarded by many as quaint in
today’s electronic world, the issues and problems involved in
electronic data processing are faced by businesses large and small
each and every day. Most businesses use computers, and the vast
majority engage in electronic data processing of some variety –
usually in processing data in order to provide goods and services
to customers in a timely and efficient manner.

31. Group Account
Most quoted companies and many
private companies are not single
companies but groups and this
subject has been exhaustively death
with in your accounting studies.
The audit of groups is much the
same as audits of single companies.

32. There are some special features as follows:
 Group accounts involve consolidating adjustment.
 International accounting standards must be complied
with.
 Subsidiaries may be audited by firms other than the
holding company auditor.
 The organization and planning of a group audit is
more complex.

33. Non-Financial Audit
A non-financial audit is the critical analysis of non-
financial records and documentations in any kind of
non-business organization.
Non-financial audit means an examination of non-
financial records to establish their reliability and the
reliability of statements drawn from them.
.

34. A non-financial audit may be:
 Audit of Educational Institution
 Audit of Charitable Institution
 Audit of Club
 Audit of Hotel
 Audit of Charitable Trust
 Audit of Hospital
 Audit of Insurance Company