COM-D-323B – AUDITING(DSE– B3)

Credit: 06 (5 Lectures + 1 Tutorial + 0 Practical)

Total Credit Hour: 60 hours
Course Objective: The course aims to provide knowledge of auditing principles, procedures, and techniques inaccordance
with current legal requirements in India.

Course Outcome: After completion of the course, students will be able to analyse and interpret the qualitative features
of information provided in the Financial Statements of a company; analyse and interpret the contents of corporate annual
report and auditor’s report to understand the true andfair financial position of a company; compute and analyse accounting
ratios of a company; conduct fund flow and working capital analysis; and conduct cash flow analysis using cash flow
reporting software.

Module – 01: Auditing Concepts & Audit Documentation and Audit Evidence:
Audit Concepts: Meaning and nature of auditing; Objectives,
advantages and limitations of auditing; Relationship of auditing
withother disciplines; Classification of Audit; Errors and Frauds and
Auditor’s duty. Ethical principles and concept of auditor’s
independence. Code of conduct & value system for auditors.
Development of Audit Plan and Programme, Delegation and
supervision of audit work; Automated Environment: Audit in an
automated environment; Key features of automated environment;
Audit approach; Audit Documentation and Audit Evidence- Concept of
Audit Documentation; Nature & Purpose of Audit Documentation;
Form, Content & Extent of AuditDocumentation; Audit File; Audit
evidence; Sufficiency and Appropriateness of Audit evidence; Audit
procedures for obtaining audit evidence; Types of Audit evidence;
Sources of audit evidence; Relevance and Reliability of audit evidence.

Module – 02: Internal Control, Internal Check, and Audit Sampling: Meaning
and objectives; Features of a good internal control system; internal
control questionnaire; internalcontrol checklist; tests of control;
Internal Control and IT Environment, concept of materiality and audit
risk. Concept of internal audit; Test checking, audit sampling and
sampling methods.

Module – 03: Vouching and Verification: Vouching – Meaning and objectives; procedure of
vouching; vouching of cash book and bank details; verification of assets and liabilities.

Module – 04: Audit of Companies: Audit of Limited Companies under the companies Act, 2013:
Qualification and disqualification, appointment, removal, renumeration, rights and duties of Auditor;
Auditor’s Report- Contents and types; audit attestation and certification, liabilities of statutory
auditors. Overview of Auditing standards.

Module – 5: Special Area of Audit: Cost audit, tax audi at, management audit, performance audit,
social audit, environmental audit, audit of banking companies, insurance companies and not for profit
organization like educational institution, club, charitable organization.

Practical exercises:
The students are required to:
1. Prepare Audit Programme for conducting audit of receipts of a school/charitable
institution.
2. Identify and verify any five-documentary evidences in A Hand book on
connection withsales,
purchases of goods/machineries, payment of expenses and
liabilities.
3. Prepare internal control questionnaire and internal
control checklist for audit of an organisation/business
firm.
4. Perform internal control under computerized audit
environment using Audit Expert Systems.
5. Perform vouching of cash book of college/learner functions,
small business firms,
club etc. to gain a practical knowledge.
6. Collect audit evidence for verification of property, plant, and
equipment.
7. Perform dummy audit of a club, college, and a small business
firm.
Note:
1. Where necessary Standard on Auditing and Statements on
Auditing Practice issued by the ICAI shall be referred.
2. students shall be provided with corporate annual reports
along with audit report so that they can get an idea of the
format and contents.

References:

1. Ainapure, V., & Ainapure, M. (2009). Auditing & Assurance.

Delhi: PHI Learning.
2. Aruna, J. (2016). Auditing. Delhi: Taxmann Publication.
3. Kumar, R., & Sharma, V. (2015). Auditing Principles & Practice.
PHI Learning.
4. Garg, P. (2019). Auditing & Assurance. Delhi: Taxmann
Publication.
5. Singh A. K., & Gupta, L. (2011). Auditing Theory and Practice.
Galgotia Publishing
Kamal, G. (1987). Contemporary Auditing. Delhi: Tata Mcgraw Hill

1. Tandon, B. N., Sudharsnam, S., & Sundharabahu, S. (2013).

Practical Auditing. New Delhi: S. Chand Publishing.

Note: Students are advised to use latest edition of text books.

Procedure of Vouching; Vouching of Cash Book
Verification of Assets and Liabilities.