This subject is one of the most important subjects in CA Final due to following reasons:
1) Audit is what we always do before / after passing CA. No matter what kind of assignments you're handling, you'll always come across some or other area / procedure of audit.
2) ICAI has given extensive and most comprehensive information on the subject at advanced level, thus you're expected to deliver at that level.
3) Your articleship training shall be tested at various questions. e.g Tax audit Form 3CD clauses, short notes on possible frauds from any ledgers, Special Audits etc.
Before you start with reading module try to understand:
What ICAI is expecting from you?
What level of understanding and explanation in answer paper will be appreciated?
What precautions you should take to avoid failure?
Reading any module for that matter without understanding the objective behind introducing various chapters, may result into lack of interest.
Auditing is the subject where students tend to show less interest once they start with reading module.
This is natural with all students,including me, but at the same time it is important to avoid this mistake.
Chapters in audit may sound very monotonous, highly theoretical and lengthy.
I have always found one very useful technique while reading theory subjects - "practical case approach"
If someone tells you to write an audit plan for "Kingfisher Airlines", you may get more interested.
Try to apply each concept you read with some or the other real life scenario.
This will develop the interest in subject. In case of , Audit related to "stock exchange"; procedure sounds very technical if you don't know the concepts. In such case, before starting with How to Audit..? try to understand the concepts related to stock exchange. If you don't know What to Audit then question of How to Audit gets tougher. It was just an example to make you understand the benefit of change in approach.
Exam Paper :
Que 1 (a):
* This question is always about Case Studies and we are expected to give comments as an auditor.
* References of "Accounting Standards" and "Standards on Auditing" are must. ( I would say Compulsory)
* Apart from SA, There are "Guidelines" on audit also. Kindly read those guidelines and quote relevant extract wherever applicable.
* Co-relate the facts of the case with AS and SA. Explain the issues in case and give professional comments.
* Avoid giving neutral or diplomatic answers. Your comments should be very clear and giving exact opinion.
* Practical questions about "Professional Ethics" for CAs
* writing style is same as que 1(a)
* Give detailed reference number : schedule / part / clause
Que 2 to Que 7
* always try to see whether you can trace this case / question to any AS/SA. You will find in 80% of the cases that some or other AS/SA, Guidelines are very much applicable
* avoid pure theoretical answer. comments should preferably in the form of opinion and not in the form of typical theory answer.
* Do not use illogical / aggressive / offensive / impractical words in answers. (your opinion should be professional, practical and legitimate)
* Again, i will repeat, avoid faking / bluffing/ off-the-point answers. (This is suggestion is from my PE II exam experience.)
* Concluding the answer is of paramount importance. (do not ever leave the answer without concluding, it shows lack of clarity and marks will get deducted)
* try to write 100 marks question paper. I know covering entire paper in 3 hours may get difficult but at least 90+ attempt is essential.
* Quality of answer is more important than number of pages you write.
Manage your time while reading ICAI module.