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Request to articles to share their experience

Ritasha (chartered accountant) (356 Points)

11 September 2010

I need articles to share their practical experiences regarding tax audit (from a to z)

vouching

ledger scrutiny points checked

finalisation

formalities like management representation letter,appoinment letter,communication to previous auditor.

plz have healthy discussion

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Joey Tribbiani (fdg) (2010 Points)
Replied 11 September 2010

I had the privilege to check the capitalisation of many plants of a public ltd listed co. The exprnc was amazing and enriching one. And one thing I noticed,in practical things are easier than theory.We use a a lot of "jugad"(as we call it in our office) entries in real life.

One such entry was:

Interest on FD account dr 800000

To depreciation 800000

This entry was passed by their well qualified staff,my immediate senior,my principal and ultimately the balance sheet was filed with SEBI. And all people knew it was wrong. the facts were:

I found that there is a difference between Head office depreciation and Plant books depreciation on certain assets. I informed my immediate senior and he informed VP finance of the company. Plant was intimated about the error.he cudnt reconcile even after 1 May. Due to pressure frm upper mgt to finalise accounts asap(due to listing of its wholly owned subs) this entry was passed

This was an example they had lot more entries like these.Mind it,the company i m talking is a blue chip company

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