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In our routine work of audit we face lots of problems but the question arise how to deal these problems nobody knows. Every article knows to conduct the audit but the question is how to start it and what should be the steps to be taken for conduct the audit.


1. Firstly when you reach at client place analyze the environment surrounding you and this will help you to ascertain the internal working of entity and helps you to make your work easier by adopting the procedures according to the Envirmont.

2. Thereafter, read previous year audit report clearly this will help you recognized last year irregularities or examine whether it is continue or not and if it is not rectified then, what were the possible steps took by management.

3. Check the opening balances of ledger and asked the management for trial balance of current year along with previous year from the management in excel format if possible.

4. Compare the current year balances with last year balances of trial balance and if there is any material changes arise then analyze the reason for such change.

5. Check the following document during audit

a. Lease/ Rent agreement

b. Sale and purchase register with supporting documents including VAT Return

c. Fixed assets register for any addition, deletion or sales of assets

d. Calculation related to Gratuity, EPF, Pension, Bonus etc. if applicable

e. Bank Reconciliation Statement along with External confirmation form bank

f. Other documents which you think to be examined

6. Check the calculation of deferred tax if applicable on the entity.

7. Examine the tax returns such as Service Tax Return, VAT Return, Excise Return etc. and compare it with the related records such as Excise Registers, Challans etc.

8. Don’t forget to take Written Representation from the management regarding the facts for which proper documents are not provided by the management along with the reason for not providing the evidence.

9. Take the necessary steps for preparing working papers for the observations while conducting the audit this will help the other person for drawing the conclusion.


Published by

CA Vishal Sharma
(Sole Practice)
Category Audit   Report

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