Accounting and Audit

ಲೆಕ್ಕಪರಿಶೆ ೋಧನೆ
Gayathri.R
What is Depreciation?
ಸವಕ್ಳಿ
 Depreciation is the reduction in the monetary value of a tangible asset over
time due to use, wear and tear, or obsolescence.
 It is an accounting method used to allocate a portion of the cost of the asset,
over its useful life, to the profit and loss statement for a financial year.
 Depreciation is a non-cash expense as it reduces the profits of a business
without a cash outflow involved.
Features of Depreciation
ಸವಕ್ಳಿಯ ಲಕ್ಷಣಗಳು
 Depreciation is a decrease in the book value of fixed assets.
 Depreciation involves loss of value of assets due to the passage of time and
obsolescence.
 Depreciation is an ongoing process until the end of the life of assets.
Depreciable assets are assets which

 Are Expected To Be Used During More Than One Accounting Period

 Have A Limited Useful Life
 Are Held By An Enterprise For Use In The Production Or Supply Or For
Administrative Purposes.
 Goodwill & Land Is Not Eligible For Depreciation.
 Depreciation Is Allowable Only To The Owner Of The Asset.
Methods of Providing Depreciation

 Straight Line Method ನೆೋರ ರೆೋಖೆಯ ವಿಧಾನ

 Diminishing Value Method ಮೌಲಯ ಕ್ಡಿಮೆಯಾಗುತ್ತಿದೆ
 Annuity Method
 Deprecation Fund Method
 Insurance Policy Method
 Sum Of Digits Method
 Revaluation Method
 Depletion Method
 Machine Rate Method
Audit

 The word "audit" derives from the Latin word audire which means "to hear".
 Meaning and Definition of
Auditing(ಲೆಕ್ಕಪರಿಶೆ ೋಧನೆ)

 “An Audit is an independent examination of financial information of any

entity whether profit oriented or not, and irrespective of its size or legal
form, when such an examination is conducted with a view to expressing an
opinion thereon.”
 Auditing is the procedure in which a qualified individual examines the books
of accounts and assemble the evidence to form an assessment and convey
their point of view to the responsible person or the management by
submitting the audit report at the end of the financial year.
Financial Auditing(ಹಣಕಾಸು
ಲೆಕ್ಕಪರಿಶೆ ೋಧನೆ)
 Financial Auditing is the process of examining an organization’s or Individual’s
financial records to determine if they are accurate and in accordance with
any application rules (including accounting standards),regulations and laws.
 The idea is to check and verify the accounts by an independent authority to
ensure that the books of accounts are done in fair manner that all books of
accounts are done in a fair manner and there is no misrepresentation or Fraud
that is being conducted.
Characteristics(ಗುಣಲಕ್ಷಣಗಳು) of Auditing

 It is a Systematic and scientific examination.

 It is undertaken by an independent person who is duly qualified.
 It verify the results shown by final account.
 It is done with the help of Voucher, information, documents and explanation
received from the authorities.
 The auditor has to satisfy himself with the authenticity of financial
statements and reports that they exit a true and fair view of the state of
affair of the concern.
 Objectives(ಉದೆದೋಶಗಳು)of Auditing

 The Indian Institute of Chartered Accountants (ICAI) in its Auditing and

Assurance Standard-2 (AAS-2) specifies the following objectives of auditing
Audit report (ಆಡಿಟ್ ವರದಿ)

 Audit report is the report that auditors express an opinion on financial

statements whether they faithfully present the company’s financial position,
financial performance, and cash flows in accordance with the applicable
financial reporting framework, such as US GAAP, IFRS or local GAAP.
ಧನಯವಾದಗಳು