"In the times where acquisitions and buyouts are trending, the field of due diligence emerges as one of the most relevant fields. Prima facie, without delving in"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/corporate-law/process-due-diligence.html
AUDITING Accounts PayableDiscussion TopicIm Done Top .docxrock73
AUDITING
Accounts Payable
Discussion Topic
I'm Done
Top of Form
Due July 30 at 11:59 PM
Starts Jul 24, 2017 1:00 AM
Bottom of Form
Do you think accounts payable confirmation can be useful to the auditor? How? What are the limitations of accounts payable confirmation? What are some alternatives to accounts payable confirmation?
Replies
1
The confirmation of accounts payable is not a generally accepted auditing procedure. The auditor is required to obtain confirmation of accounts receivable only. The evidence supporting accounts payable, such as vendors' invoices and statements, is produced by outside sources. Determining that all payables are recorded is the primary objective of the accounts payable audit. It follows that confirmations are very useful in supplying supporting evidence for receivables but that auditing procedures other than confirmation are required to verify that all payables are recorded. The selection of accounts payable for confirmation would be from the following groups: (1) large accounts including important suppliers even though the account balance is small at balance sheet date; (2) accounts for which monthly statements are unavailable; (3) accounts with unusual transactions; and (4) accounts with zero balances that had substantial activity earlier in the year.
The main limitation of accounts payable confirmation is that it does not prove the completeness of recorded accounts payable. The accounts payable confirmation procedures are not always used because reliable externally generated evidence supporting accounts payable balances are generally available for audit inspection on the premises of client. Some auditors believe that it is not required to confirm accounts payable because the search for unrecorded liabilities is the basic means of testing for completeness of accounts payable.
The alternative procedures are generally performed for non replies of accounts payable confirmations and or selected unconfirmed accounts. This includes examination of unpaid invoices, receiving reports and bills supporting the recorded balances. The examination of vendor statement dated near the balance sheet date can also be made. The statement balances shall be reconciled to the balance in client account. The subsequent payment of liability shall be vouched. The invoices from few selected vendors for the purchase of goods and services after balance sheet date shall be inspected. It shall be determined whether invoices show an amount that was owed as on balance sheet date. Generally alternative procedures on non replies are not required because the search for unrecorded liabilities compensates for such procedures. The main benefit of this alternative procedure is that it provides 100% confirmation about the existence of accounts payable. The limitation is that this process is quite time taking and wastes auditor’s precious time. It is not very result oriented because performing basic or alternative audit procedures for acco ...
What is the procedure for financial statement audit.pdfRathnakarReddy17
The purpose of a financial statement audit is to add credibility to the reported financial condition and business performance. Annual reports must be submitted by all publicly traded corporations and are subject to SEC audits.Similarly, lenders typically require audits of the financial statements of the companies they finance. Suppliers may also require audited Financial Statement Preparation in New York before granting trade credit (usually only if the amount of credit requested is substantial).
This presentation would be helpful if you are seeking information regarding Statutory Bank Branch Audit under Banking Regulations Act, India.
This presentation was delivered by me at Institute of Chartered Accountants of India's program in our town during April 2014.
AUDITING Accounts PayableDiscussion TopicIm Done Top .docxrock73
AUDITING
Accounts Payable
Discussion Topic
I'm Done
Top of Form
Due July 30 at 11:59 PM
Starts Jul 24, 2017 1:00 AM
Bottom of Form
Do you think accounts payable confirmation can be useful to the auditor? How? What are the limitations of accounts payable confirmation? What are some alternatives to accounts payable confirmation?
Replies
1
The confirmation of accounts payable is not a generally accepted auditing procedure. The auditor is required to obtain confirmation of accounts receivable only. The evidence supporting accounts payable, such as vendors' invoices and statements, is produced by outside sources. Determining that all payables are recorded is the primary objective of the accounts payable audit. It follows that confirmations are very useful in supplying supporting evidence for receivables but that auditing procedures other than confirmation are required to verify that all payables are recorded. The selection of accounts payable for confirmation would be from the following groups: (1) large accounts including important suppliers even though the account balance is small at balance sheet date; (2) accounts for which monthly statements are unavailable; (3) accounts with unusual transactions; and (4) accounts with zero balances that had substantial activity earlier in the year.
The main limitation of accounts payable confirmation is that it does not prove the completeness of recorded accounts payable. The accounts payable confirmation procedures are not always used because reliable externally generated evidence supporting accounts payable balances are generally available for audit inspection on the premises of client. Some auditors believe that it is not required to confirm accounts payable because the search for unrecorded liabilities is the basic means of testing for completeness of accounts payable.
The alternative procedures are generally performed for non replies of accounts payable confirmations and or selected unconfirmed accounts. This includes examination of unpaid invoices, receiving reports and bills supporting the recorded balances. The examination of vendor statement dated near the balance sheet date can also be made. The statement balances shall be reconciled to the balance in client account. The subsequent payment of liability shall be vouched. The invoices from few selected vendors for the purchase of goods and services after balance sheet date shall be inspected. It shall be determined whether invoices show an amount that was owed as on balance sheet date. Generally alternative procedures on non replies are not required because the search for unrecorded liabilities compensates for such procedures. The main benefit of this alternative procedure is that it provides 100% confirmation about the existence of accounts payable. The limitation is that this process is quite time taking and wastes auditor’s precious time. It is not very result oriented because performing basic or alternative audit procedures for acco ...
What is the procedure for financial statement audit.pdfRathnakarReddy17
The purpose of a financial statement audit is to add credibility to the reported financial condition and business performance. Annual reports must be submitted by all publicly traded corporations and are subject to SEC audits.Similarly, lenders typically require audits of the financial statements of the companies they finance. Suppliers may also require audited Financial Statement Preparation in New York before granting trade credit (usually only if the amount of credit requested is substantial).
This presentation would be helpful if you are seeking information regarding Statutory Bank Branch Audit under Banking Regulations Act, India.
This presentation was delivered by me at Institute of Chartered Accountants of India's program in our town during April 2014.
What is the Financial Statement Audit Process.pdfsarikabangimatam
A financial statement audit is a review of your financials and related documents by a third-party auditor. This review report is intended to add credibility to our reported financial health and Business Accountants performance. But what happens in this study? Does your business need an audit? We answer all your questions below.
Basics of finance and accounting written for owners of business including family business. Step by step learning by all professionals and self employed besides business owners. At the end of each chapter there are questions for revision & practice.
First, the retained earnings increased by 85.35 compared fromShainaBoling829
First, the retained earnings increased by 85.35% compared from prior year. This will affect to increase in cash and accounts receivable which have 47.15% and 43.59% respectively. Additionally, since we have increase in Accounts Receivable, there might be an increase in uncollectible accounts which the reason doubtful allowance increases by 72.41%. A proper policy and terms for the customer should be strictly monitored by the Treasurer to avoid an increase in uncollected accounts.
Second, since we have more Sales during the year, an overtime for employees or a possible additional benefit is the reason there is an increase with Salaries Payable and other Taxes Payables. Long-term Payable may also be a result of additional investment, especially for PPE.
Third, Investment for PPE increased by 35.28% which is needed to increase the production and Sales. Other Investment such as Trading securities and Available-for-sale securities also increased.
On the other hand, Inventories decrease due to high demand of Sales. A proper control monitoring should properly address to have enough stocks and avoid delay due to it. Also, the Treasurer should also handle properly the proper timing of payment of current assets such as Notes Payable which have no movement since prior year.
To:
Board of DirectorsFrom:
Rachel Suarez GuerraDate:
Feb 27, 2022Subject:
Investment Strategies
Following your request to explore the company's financial state, I have researched the requested areas and would like to share my findings with you. I hope that the information I will share with you will provide the clarity needed for the company's growth. Below, I have covered the various parts revolving around the company's financial state.
Debt versus equity securities
These are the two security types that are significant factors to consider when accounting for an investment. Debt securities entail the borrower repaying the principal the initial principal, while equity entails ownership of the company's net assets. However, a very recent finding shows that managers do not reduce the risk of equity investment portfolios (Kim et al., 2022). An example of debt security is a bond, while stock is equity security. When buying a bond in a company, they are repaid both the principal and the interest accrued. However, when it comes to stocks, if an individual buys stocks in a particular company, they buy a piece of the specific company. Therefore, the investors profit in the case of profits, and the same applies to losses.
Various types of investments
Classes of debt securities are held to maturity, trading, and available for scale, while those of equity include insignificant influence, major influence, and controlling influence. Additional examples of debt securities include corporate bonds, municipal bonds, government bonds, and collateralized bonds. In contrast, more examples of equity securities would include common preference shares, warrants, convertible bonds, and ...
An organization which is diligence ready, will be adhering to all the corporate Secretarial & Corporate governance norms thereby meeting the expectations of all stakeholders.
Financial statements of a Company are the introductory and formal periodic reports through which the commercial operation communicates fiscal information to its possessors and colourful other external parties which include investors, duty authorities, government, workers, etc. These typically relate to (a) the balance distance ( position statement) at the end of the counting period, and (b) the statement of profit and loss of a. company. Nowadays, the cash inflow statement is also taken as an integral element of the financial statements of a company.
Basics of Accounting: General Purpose Financial Statements & their Qualitativ...taxguru5
"General Purpose Financial Statements Information provided in Financial Statements aims at Informed Decision Making of Existing and Potential Investors, Lenders"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/chartered-accountant/basics-accounting-general-purpose-financial-statements-qualitative-characteristics.html
Basics of Accounting: General Purpose Financial Statements & their Qualitativ...taxguru5
"General Purpose Financial Statements Information provided in Financial Statements aims at Informed Decision Making of Existing and Potential Investors, Lenders"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/chartered-accountant/basics-accounting-general-purpose-financial-statements-qualitative-characteristics.html
What is the Financial Statement Audit Process.pdfsarikabangimatam
A financial statement audit is a review of your financials and related documents by a third-party auditor. This review report is intended to add credibility to our reported financial health and Business Accountants performance. But what happens in this study? Does your business need an audit? We answer all your questions below.
Basics of finance and accounting written for owners of business including family business. Step by step learning by all professionals and self employed besides business owners. At the end of each chapter there are questions for revision & practice.
First, the retained earnings increased by 85.35 compared fromShainaBoling829
First, the retained earnings increased by 85.35% compared from prior year. This will affect to increase in cash and accounts receivable which have 47.15% and 43.59% respectively. Additionally, since we have increase in Accounts Receivable, there might be an increase in uncollectible accounts which the reason doubtful allowance increases by 72.41%. A proper policy and terms for the customer should be strictly monitored by the Treasurer to avoid an increase in uncollected accounts.
Second, since we have more Sales during the year, an overtime for employees or a possible additional benefit is the reason there is an increase with Salaries Payable and other Taxes Payables. Long-term Payable may also be a result of additional investment, especially for PPE.
Third, Investment for PPE increased by 35.28% which is needed to increase the production and Sales. Other Investment such as Trading securities and Available-for-sale securities also increased.
On the other hand, Inventories decrease due to high demand of Sales. A proper control monitoring should properly address to have enough stocks and avoid delay due to it. Also, the Treasurer should also handle properly the proper timing of payment of current assets such as Notes Payable which have no movement since prior year.
To:
Board of DirectorsFrom:
Rachel Suarez GuerraDate:
Feb 27, 2022Subject:
Investment Strategies
Following your request to explore the company's financial state, I have researched the requested areas and would like to share my findings with you. I hope that the information I will share with you will provide the clarity needed for the company's growth. Below, I have covered the various parts revolving around the company's financial state.
Debt versus equity securities
These are the two security types that are significant factors to consider when accounting for an investment. Debt securities entail the borrower repaying the principal the initial principal, while equity entails ownership of the company's net assets. However, a very recent finding shows that managers do not reduce the risk of equity investment portfolios (Kim et al., 2022). An example of debt security is a bond, while stock is equity security. When buying a bond in a company, they are repaid both the principal and the interest accrued. However, when it comes to stocks, if an individual buys stocks in a particular company, they buy a piece of the specific company. Therefore, the investors profit in the case of profits, and the same applies to losses.
Various types of investments
Classes of debt securities are held to maturity, trading, and available for scale, while those of equity include insignificant influence, major influence, and controlling influence. Additional examples of debt securities include corporate bonds, municipal bonds, government bonds, and collateralized bonds. In contrast, more examples of equity securities would include common preference shares, warrants, convertible bonds, and ...
An organization which is diligence ready, will be adhering to all the corporate Secretarial & Corporate governance norms thereby meeting the expectations of all stakeholders.
Financial statements of a Company are the introductory and formal periodic reports through which the commercial operation communicates fiscal information to its possessors and colourful other external parties which include investors, duty authorities, government, workers, etc. These typically relate to (a) the balance distance ( position statement) at the end of the counting period, and (b) the statement of profit and loss of a. company. Nowadays, the cash inflow statement is also taken as an integral element of the financial statements of a company.
Basics of Accounting: General Purpose Financial Statements & their Qualitativ...taxguru5
"General Purpose Financial Statements Information provided in Financial Statements aims at Informed Decision Making of Existing and Potential Investors, Lenders"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/chartered-accountant/basics-accounting-general-purpose-financial-statements-qualitative-characteristics.html
Basics of Accounting: General Purpose Financial Statements & their Qualitativ...taxguru5
"General Purpose Financial Statements Information provided in Financial Statements aims at Informed Decision Making of Existing and Potential Investors, Lenders"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/chartered-accountant/basics-accounting-general-purpose-financial-statements-qualitative-characteristics.html
Corporate Compliance Calendar for July, 2022taxguru5
"CORPORATE Compliance CALENDAR covers Compliance under Income Tax act, 1961, Compliance under Goods & Services Act, 2017, Compliance under Other Statutory Laws"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/corporate-law/corporate-compliance-calendar.html
Corporate Compliance Calendar for July, 2022taxguru5
"CORPORATE Compliance CALENDAR covers Compliance under Income Tax act, 1961, Compliance under Goods & Services Act, 2017, Compliance under Other Statutory Laws"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/corporate-law/corporate-compliance-calendar.html
"Just as Sardar Vallabh Bhai Patel unified India by helping several princely States subsume into a common entity, the GST will bring economic unification. If"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/goods-and-service-tax/five-years-gst-ebook-cbic.html
"Recently, High Court of Delhi has accepted Writ Petition in the case of Societe De Participations Financieres ET Industrielles Spafi (French Shareholder) vs. As"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/income-tax/challenging-cbdts-mfn-clause-circular-no-3-2022-dated-03-02-2022.html
"Just as Sardar Vallabh Bhai Patel unified India by helping several princely States subsume into a common entity, the GST will bring economic unification. If"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/goods-and-service-tax/five-years-gst-ebook-cbic.html
"Recently, High Court of Delhi has accepted Writ Petition in the case of Societe De Participations Financieres ET Industrielles Spafi (French Shareholder) vs. As"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/income-tax/challenging-cbdts-mfn-clause-circular-no-3-2022-dated-03-02-2022.html
Capital Gain Tax on sale of House Property & Eligible Exemptions- taxgur...taxguru5
"Calculations of Capital Gain Tax on sale of House Property and Exemption available under Income Tax Act What is Capital Gain? According to section 45 of the Inc"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/income-tax/capital-gain-tax-sale-house-property-eligible-exemptions.html
Audit Quality Review Report of Statutory Audit done by SRBC & Co LLP of IL&FStaxguru5
"Audit Quality Review (AQR) Report in respect of Statutory Audit done by SRBC & Co LLP, Chartered Accountants Firm Registration Number (FRN324982E/E300003) o"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/chartered-accountant/audit-quality-review-report-statutory-audit-srbc-co-llp-ilfs.html
Audit Quality Review Report of Statutory Audit done by SRBC & Co LLP of IL&FStaxguru5
"Audit Quality Review (AQR) Report in respect of Statutory Audit done by SRBC & Co LLP, Chartered Accountants Firm Registration Number (FRN324982E/E300003) o"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/chartered-accountant/audit-quality-review-report-statutory-audit-srbc-co-llp-ilfs.html
Taxability of Capital Gain on Transfer of Agricultural Landtaxguru5
"As you are aware that Capital Gain Tax is charged on transfer of Capital Assets under provisions of Section 45 to 55A of the Income Tax Act, 1961. The main ingr"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/income-tax/taxability-capital-gain-transfer-agricultural-land.html
Taxability of Capital Gain on Transfer of Agricultural Landtaxguru5
"As you are aware that Capital Gain Tax is charged on transfer of Capital Assets under provisions of Section 45 to 55A of the Income Tax Act, 1961. The main ingr"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/income-tax/taxability-capital-gain-transfer-agricultural-land.html
A Bare Knuckle Truth About The Aviation Industry!taxguru5
"A bare knuckle truth about the aviation industry is that globally, the airports and airlines struggle between balancing the impact of aviation on environment an"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/corporate-law/bare-knuckle-truth-aviation-industry.html
A Bare Knuckle Truth About The Aviation Industry!taxguru5
"A bare knuckle truth about the aviation industry is that globally, the airports and airlines struggle between balancing the impact of aviation on environment an"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/corporate-law/bare-knuckle-truth-aviation-industry.html
"In the times where acquisitions and buyouts are trending, the field of due diligence emerges as one of the most relevant fields. Prima facie, without delving in"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/corporate-law/process-due-diligence.html
Income Tax on Short Term Capital Gain with examplestaxguru5
"Gain arising on transfer of capital asset is charged to tax under the head Capital Gains. Income from capital gains is classified as Short Term Capital Gains an"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/income-tax/provisions-short-term-capital-gain-examples.html
Income Tax on Short Term Capital Gain with examplestaxguru5
"Gain arising on transfer of capital asset is charged to tax under the head Capital Gains. Income from capital gains is classified as Short Term Capital Gains an"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/income-tax/provisions-short-term-capital-gain-examples.html
Clubbing of Income under Income Tax Act, 1961 with FAQstaxguru5
"Clubbing of income means Income of other person included in assessees total income, for example Income of husband which is shown to be the income of his wife is"
TaxGuru is a platform that provides Updates On Amendments in Income Tax, Wealth Tax, Company Law, Service Tax, RBI, Custom Duty, Corporate Law , Goods and Service Tax etc.
To know more visit https://taxguru.in/income-tax/clubbing-of-income-under-the-income-tax-act-1961.html
"Valuation Profession in India Valuation is the process of determining 'the Economic Worth' of an Asset or Liability under certain 'Assumptions"
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To know more visit https://taxguru.in/corporate-law/valuation-profession-india.html
हम आग्रह करते हैं कि जो भी सत्ता में आए, वह संविधान का पालन करे, उसकी रक्षा करे और उसे बनाए रखे।" प्रस्ताव में कुल तीन प्रमुख हस्तक्षेप और उनके तंत्र भी प्रस्तुत किए गए। पहला हस्तक्षेप स्वतंत्र मीडिया को प्रोत्साहित करके, वास्तविकता पर आधारित काउंटर नैरेटिव का निर्माण करके और सत्तारूढ़ सरकार द्वारा नियोजित मनोवैज्ञानिक हेरफेर की रणनीति का मुकाबला करके लोगों द्वारा निर्धारित कथा को बनाए रखना और उस पर कार्यकरना था।
‘वोटर्स विल मस्ट प्रीवेल’ (मतदाताओं को जीतना होगा) अभियान द्वारा जारी हेल्पलाइन नंबर, 4 जून को सुबह 7 बजे से दोपहर 12 बजे तक मतगणना प्रक्रिया में कहीं भी किसी भी तरह के उल्लंघन की रिपोर्ट करने के लिए खुला रहेगा।
role of women and girls in various terror groupssadiakorobi2
Women have three distinct types of involvement: direct involvement in terrorist acts; enabling of others to commit such acts; and facilitating the disengagement of others from violent or extremist groups.
01062024_First India Newspaper Jaipur.pdfFIRST INDIA
Find Latest India News and Breaking News these days from India on Politics, Business, Entertainment, Technology, Sports, Lifestyle and Coronavirus News in India and the world over that you can't miss. For real time update Visit our social media handle. Read First India NewsPaper in your morning replace. Visit First India.
CLICK:- https://firstindia.co.in/
#First_India_NewsPaper
31052024_First India Newspaper Jaipur.pdfFIRST INDIA
Find Latest India News and Breaking News these days from India on Politics, Business, Entertainment, Technology, Sports, Lifestyle and Coronavirus News in India and the world over that you can't miss. For real time update Visit our social media handle. Read First India NewsPaper in your morning replace. Visit First India.
CLICK:- https://firstindia.co.in/
#First_India_NewsPaper
In a May 9, 2024 paper, Juri Opitz from the University of Zurich, along with Shira Wein and Nathan Schneider form Georgetown University, discussed the importance of linguistic expertise in natural language processing (NLP) in an era dominated by large language models (LLMs).
The authors explained that while machine translation (MT) previously relied heavily on linguists, the landscape has shifted. “Linguistics is no longer front and center in the way we build NLP systems,” they said. With the emergence of LLMs, which can generate fluent text without the need for specialized modules to handle grammar or semantic coherence, the need for linguistic expertise in NLP is being questioned.
03062024_First India Newspaper Jaipur.pdfFIRST INDIA
Find Latest India News and Breaking News these days from India on Politics, Business, Entertainment, Technology, Sports, Lifestyle and Coronavirus News in India and the world over that you can't miss. For real time update Visit our social media handle. Read First India NewsPaper in your morning replace. Visit First India.
CLICK:- https://firstindia.co.in/
#First_India_NewsPaper
1. PROCESS OF DUE DILIGENCE
https://taxguru.in/corporate-law/process-due-diligence.html
In the times where acquisitions and buyouts are trending, the field of due diligence emerges as one of the most
relevant fields. Prima facie, without delving into the technicalities of the term due diligence, the term due
diligence means a process of verification, audit, and investigation of the potential investment by looking at the
facts and the financial information. The process of due diligence is a continuous procedure to be carried out
which is initiated right since the inception of the proposal of acquisition and goes on till the finalization of
proposal into actual buyout. . The need for carrying out the due diligence has its roots from the legal concept of
“Caveat Emptor” meaning “let the buyer beware”. Due diligence provides more comfort to the buyer with
regards to their expectations of potential benefits and synergies enjoyed out of the investments. However, the
purchase of investment without the proper due diligence gives rise to considerable risk since there may be grey
areas which may not be evident per se and may significantly impact the decision of acquisition. Due diligence
might further provide an affirmation to the buyer that the proposed investment confirms to the capital and
operational targets and the rationale for such investment.
Broadly speaking, due diligence is divided into the following categories:
Financial Due Diligence;
Tax Due Diligence;
Operational Due Diligence.
The detailed process and checklist highlighting each of the above is as under:
A. Financial Due Diligence (FDD)
Financial due diligence is done for the review period, which is decided on a case-to-case basis. Generally,
review period ranges from a time of 3 to 5 years. Before starting the FDD following are the documents
that should be ready for the review period:
Audited Financial statements;
Unaudited Financial statements;
Cash Flow statements;
Income-tax returns.
Generally, the process starts with a comprehensive analysis of the financial statements of the target. A
review of the target firm’s financing and capital structure is the foremost required. Further, analysis should
include details of short-term and long-term borrowings, the debt-equity ratios , interest and fixed charges
coverage ratios of the Company, the nature and extent of assets kept as collateral against borrowings and
the extent of dependability of the Company’s operations on those collaterals.
Financial due diligence also involves analysis of the cash flow statement. Examination of the quality of
company’s relationships with its lenders and an ultimate opinion concerning the reliability and credibility
of its financial statements.
Another important point is to verify whether the receivables are outstanding beyond a normal turnaround
time and the extent of fruitful efforts made by the Company to realise its long dues;
2. Analyze the past sales trend of the Target and compare the credibility of the assumptions in the
projections;
Analyze the loan agreements of the Target to evaluate whether any prior approval is required before such
transaction;
Whether the Budget meets the actual data or there are variances.
Whether any of the past acts of the Company was done ultra-vires the powers granted to it vide the AoA
and MoA and possible implications of such acts after the acquisition is materialised.
B. Tax Due Diligence
I. Direct Tax
A typical direct tax due diligence entails review of relevant documents from which the tax information can be
sourced. The source to obtain the relevant tax information are as follows:
a) The financial statements of Target
b) Tax records of Target
The scope of the tax information is as under:
Review of the contingent liability;
Provision for outstanding demands recognised as present obligations
Review of tax provisions and tax paid against regular self-assessment in the balance sheet;
Analysis of the effective tax rate;
Review of MAT paid and MAT credit;
Analysis of accumulated deferred tax assets and liabilities;
The scope of the tax records is as under:
Review of Income tax returns;
Review of Tax audit reports;
Withholding tax compliance;
Tax depreciation claims;
Analysis of international transactions with the associated enterprise;
Review of the tax holiday exemptions;
Analysis of the accumulated losses and impact of deal on such losses;
Review of the expenses, keeping section 43B and section 40 in mind;
Analysis of the past assessment records.
II. Indirect tax
The scope of Due diligence for indirect tax is as under:
Relevant indirect tax information is normally available in the profit and loss account related schedules,
notes attached to the financial statements, Auditors Report and Directors Report. The Notes to accounts
disclose the contingent liability in respect of disputes against the company. The Auditor’s report discloses
the details of outstanding indirect tax as well as disputed dues. Sometimes, the Director’s report includes
foreign exchange earnings and outgo position and also discusses the status of ongoing tax litigation.
3. Examining the contingent liability schedule and indirect tax provision created in books of accounts
enables a reviewer to get an insight into indirect tax disputes between the company and the tax
authorities. As the next step, ewer may ask the necessary questions/review relevant records to examine
details of disputes between the target and the tax authorities and would then highlight the risk exposure
Generally, an entity liable to pay any tax has to obtain appropriate registration, pay appropriate taxes and
file periodic returns under specific indirect tax legislation. The detailed tax records maintained by the
company provide information regarding the indirect tax implications on the business carried out/services
provided by the target.
The returns furnished to tax authorities contain information such as the rate of tax applicable and the
details of exemption claimed. Typically, under indirect tax laws, goods/services are taxed based on their
classification. One finds that the tax authorities often raise disputes with regard to the classification of the
goods/services. Hence, the reviewer must analyse the positions adopted by the target in this regard and
comment on their tenability.
The government has announced number of exemptions under GST. Often these exemptions are subject to
many conditions and prescribed procedures. A reviewer has to analyses the appropriateness of the
eligibility of exemption or the procedure followed or the records maintained with respect to exemption
availed in respect of GST.
Normally, tax paid at the time of the procurement of goods or services is eligible for set off against the
output tax liability However, various Legislations prescribe detailed criteria for the eligibility of input tax
credit. During the review, tax credit availed is reviewed, and test checks are carried out to identify and
report exposure if any
Records and returns are reviewed to ensure that appropriate input credit has been availed and utilized
while discharging output tax liability and that the said liability has been paid (through credit or cash or
both) on time. This also includes a review of the appropriateness of reversal of input tax credit on
exempted services effected by the Target.
Authors- CA Chintan Rachh & CA Priyanka Hotchandani.