In the case of a Sinagapore based subsidiary of an Indian Parent company, during the course of statutory audit of subsidiary by Singapore based auditors, it was observed:

1.It’s the first year of operation of the company;
2.there are no multiple bank accounts rather there is a single bank account;
3.books of accounts of the company are properly maintained;
4.bank balances are properly reconciled on a monthly basis,in fact there are no pending entries even as per a single monthly reco,i.e.bank balance as per books & state are duly tallied;
5.all such recos are duly provided to statutory auditors;
6.full bank statements are also provided for audit;
7.not satisfied with above, auditors even themselves verify the transactions appearing in bank statements through online mode (with clients user id & pass);

Even after above, finally auditors decided to qualify the audit report merely due to non-production of bank balance confirmation certificate from bank with following remark:

The company has cash at bank of US$52,483 as disclosed in Note 4 to the financial statements
as at 31 March 2012. During the course of our audit and up to date of this report, we were
unable to obtain the bank confirmation. In this regard, we were unable to obtain sufficient
appropriate audit evidence and carry out alternative procedures to satisfy ourselves on the
existence, accuracy and valuation of the balance and possible effects on the financial
statements had we obtained the bank confirmation.


In my personal opinion:

1.obtaining the bank balance confirmation certificate from bank is one of the audit procedures & merely non-receipt of such certificate can not make the balance in doubt when all other evidences are available regarding its existance;

2.Even in case of sundry Debtors, Creditors & other balances with third parties, it’s a standard point to put in audit report that-“balances of sundry debtors & creditors are subject to confirmation from parties.”
Above point is much lesser impactful than specific qualification written in present case.

3.such qualification not only places the question over the client, but also with the Bank & even the auditors themselves as despite of so many evidences, they are unable to form an opinion whether such balance is existing with bank or not.

4.such uncalled qualification may be taken very seriously by the investors, financers of the company under audit.

Thus, based on above, such qualification should be avoided.
PL COMMENT ON ABOVE.

A ca practicing in individual name can use word" & co." or " & associate " after his name.

Dear Sir/Madam,
I have to confirm that if the closing stock of a person is destroyed & the claim is received.
So whether as per AS 2, this receivable is to be shown as closing stock value under Financial Statements???

And also guide me that if this person has taken a loan against stock, then can he show this receivable amount as stock to his banker???

Dear Sir,

I Have Flexible Laminated Pouch Roll printing Business,Company Annual Turn Over 83 Crores,so tell me a requirement in company cost audit,and also tell me cost audit limit,

If a private limited company has statutory audit period from 1st May 2011 to 30th April 2012, should the auditor also sign the Balance Sheet as on 31st March, 2012 for reporting in form 3CA ?
Please guide me...

is there any limit on turnover as to when statutory audit is applicable?

Dear Sir,
During the audit of Bank, we found that there are many old sundry deposits with the bank taken as EMD during the bidding process. These deposits are not demanded by the bidder even they did not succeed in the bidding process.

My question is can bank take these deposits to P&L A/c and w/back or there is some guidelines of RBI for the treatment of un-reconcilable sundry deposits.

Respected Experts,
Very urgent please clarify me ASAP.
The seller sells goods to a buyer which is attracting Central Sales Tax. The buyer buys the goods to resell the same unit in the same condition (i.e. he is just a trader). In such a case can the seller charge the buyer at CST rate of 2% or should he charge at the Local VAT rate.
With regards,
Rajesh.

If a company makes an sales which is attracting Central Sales Tax, it can enjoy sales tax at a concessional rate of 2% even if the local VAT is more than 2%. But to enjoy this concession seller has to obtain Form C from the buyer. Suppose if the company makes a 10 different invoices to a buyer in a month, should the seller get 10 Form C from the buyer or is it sufficient to get one Form C that provides the details of 10 invoices. please clarify me this is very urgent issue.

With regards,
Rajesh.

Dear Experts,

A private company whose gross turnover is above 40 lakhs, but its expenses is more than the income i.e. loss. Is sec-44AB is aplicabel for this company.

Waiting for your kind reply.

Thanking you,