Auditor's Report

AAS 1576 views 3 replies

   Will a   reference to a particular Note(s)  on Accounts  in the Auditor's  Report   be called Qualification?

  I  believe that every Qualification/  Adverse Remark should state  the impact of such  qualification or

  Adverse Remark on the Accounts. .   Withoout stating the impact, it becomes a mere  opinion and  does not  call for

a re ply in the  Directors' Report to Shareholders.    is  this view correct? .     

Replies (3)

exactly sir. ur view is correct. an auditor while reporting,  should be aware of the use of expressions in the report. a qualification in the report is to be substantiated in the report or its annexure. the likely impact of the qualification in the financials, if possible should also be explained. Reference to a notes to accounts is a routine practice by auditors. But the reason for such referece shuold be explained in the report.

But the statutory requirement is always statutory. The directors are expected to give explanation to the qualifications in the auditors report. The rite or wrong done by the auditor is not an issue in this regard.

In ur case, i think it is better to have a discussion with the auditor so as to analyse the impact of the opinion of the auditor in the financials and see whether it is to be qualified or not.

EVERY RESERVATION , REMARKS  NEEDS A REPLY FROM THE DIRECTORS TO THE SHAREHOLDERS ...

even  if  auditor have not quntified the impact of the same in his report , directors need to give there reply to shareholders

 

 Only Qualification, Reser vation  and Adverse rmarks  are  covered u/s217(3)of Companies  Act  1956 and not an Opi nion, leave alone Adverse Opinion   ( AdverseReamark is  not  an  Adverse Op inion,i feel)  Since the Qualification,  Reservtion and  Adverese  Remarks per se   should quantify f   the impact,    i beg  to disagree   withvthe views of   Mr. Ramsinghania


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