Master of Business Administration - MBA Semester 3
Internal Audit and Control4 Credits
(Book ID: B1211)
Assignment Set- 1Q.1 Critically evaluate the qualities of an Auditor in the wake of recent scamsAnswer:
An auditor renders a professional service to his client. He should not only possess theprescribed statutory qualifications but also certain personal qualities. Some of thosepersonal qualities are mentioned below:
According to Spicer and
Pegler, ”the auditor should have a full
share of that most valuable commodity-
commonsense.” This is necessary to
distinguish betweenimportant and not so important information.
Expression of opinion is a prime duty of an auditor. An influenced andbiased person cannot form an independent opinion. Hence, independence in true sense isan utmost quality of an auditor.
3.Honesty and Integrity:
Like any other professional viz. Doctors, Lawyers etc. auditor should possess a high moral character. In a way, he is a public servant. He must notknowingly, misinterpret any fact or sign any document under undue pressure.
Independence of an auditor depends on his ability to act with objectivity. For example, the auditor of XYZ Company believes that closing stock has not been properlyvalued but accepts a certificate from the management as to its valuation. In this case, theauditors
He should be able to communicate effectively, both orally and in writing.Particularly in the matter of report writing, he should be able to convey his message clearlyand unambiguously.
He should be firm, yet diplomatic with his client and staff. He should betactful enough to obtain necessary written as well as oral evidence from his client, so that hecan form a reasonable opinion.
7.Awareness of latest developments:
An auditor should keep his knowledge up to daterelated to his audit work likes changes in laws, changes in professional standards, latestdevelopment in technical guidelines etc.
Q.2 What is social audit? Is social audit taken seriously by the corporate world? Giveexamples of corporates undertaking social audit.Answer:Social audit