Profit & Loss A/c

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Querist : Anonymous

Querist : Anonymous (Querist)

12 May 2011 Dear Expert,

Please tell me how u confirm (100% correct) that every expenses are done and every provision are made after preparation of P& L A/c. the above question was asked by an interviewer

Pankaj

Pankaj (Expert)

12 May 2011 Had there been so confirmation, there would not be any need for CAs.

To ensure that all expenses are booked :
1 Go through cash book
2 Check all GRN
3 Check all invoices
4 Check whether entries passed in PY are passed in current year or not.

This way you can ensure that least ommission have happened but 100% correct is... forget it.

Pankaj Gandhi Jaiswal

Pankaj Gandhi Jaiswal (Expert)

05 June 2011 It is the question of Assesement of Internal control and degree of your reliance on their system tested by you. Unless and until you will not find any mistake generally financial statement will be treated as true and fair and not true and correct. Fair means we have adopted several tools and techniques which provide us assurance to express our view. there are lot of process to check missing provisions and incomes recording just check prescribed SOP has been followed or not BY Company as well as by Auditor

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