Submitted To : Submitted By :

Dr. Shivani Bector Shivam Sood

22331
CERTIFICATE

I Certify that this Project “CHARTED ACCOUNTANT”

Submitted to Mata Gujri College, Sri Fatehgarh Sahib
affiliated to Punjabi university , Patiala in fulfillment of
the award of Bachelor of Business Administration, is a
record of independent research of and carried out by
Ms. Kaur under my supervision and guidance.

Guide :
Dr. Shivani Bector
(Department of Management
Studies)
DECLARATION

I, Shivam Sood, hereby declare that Project titled “CHARTED

ACCOUNTANT” is the outcome of my Research work. This
research has not been submitted earlier to any institution or
university for the award of any degree/diploma.
The Project report is the result of my own hard work and self
belief.
ACKNOWLEDGEMENT
No great Endeavour in any field is possible in solitude. It needs inspiration, guidance
and Help at every step. So, I must preface my report by expressing sincere and deep
gratitude to those who made it possible for me to complete any project work.
First of all, I bow my head in gratitude to God for His blessing. It is my pleasant duty to
place on record my sincere thanks to worthy and honorable principal Dr. Kashmir Singh
Sidhu for encouraging and liberal facilities during the course of my study.
I am thankful to Dr. Kamalpreet Kaur, Head of my department for giving me opportunity
to undertake this project and provide valuable suggestions. It gives me pleasure my
profound sense of gratitude and indebtedness to my Major advisor Dr. Shivani Bector
(Assistant Professor of Management Department) for her valuable guidance, support
and cooperation extended to me during the course of the study.

I am thankful to other faculty members of my department for giving their valuable

suggestions. Sincere thanks to the respondents who extended their cooperation by
providing the Information for study and for showing interest in my research.
I shall be failing in my duty if I don’t thank many others who are directly or indirectly
helped me.
 INTRODUCTION -AN OVERVIEW
OF AUDITING

Economic decisions in every society must be

based upon the information available at the time
the decision is made. For example, the decision
of a bank to make a loan to a business is based
upon previous financial relationships with that
business, the financial condition of the company
as reflected by its financial statements and other
factors.
 ORIGIN AND EVOLUTION

The term audit is derived from the Latin term

‘audire,’ which means to hear. In early days an
auditor used to listen to the accounts read over by
an accountant in order to check them Auditing is as
old as accounting. It was in use in all ancient
countries such as Mesopotamia, Greece, Egypt.
Rome, U.K. and India. The Vedas contain reference
to accounts and auditing. Arthasashthra by Kautilya
detailed rules for accounting and auditing of public
finances.
 FEATURES OF AUDITING
a. Audit is a systematic and scientific examination of the
books of accounts of a business.
b. Audit is undertaken by an independent person or body
of persons who are duly qualified for the job.
c. Audit is a verification of the results shown by the profit
and loss account and the state of affairs as shown by the
balance sheet.
d. Audit is a critical review of the system of accounting and
internal control.
e. Audit is done with the help of vouchers, documents,
information and explanations received from the
authorities.
OBJECTIVES OF AUDITING

There are two main objectives of auditing. The primary

objective and the secondary or incidental objective.

A. Primary objective – as per Section 227 of the Companies Act

1956, the primary duty (objective) of the auditor is to report
to the owners whether the balance sheet gives a true and
fair view of the Company’s state of affairs and the profit and
loss A/c gives a correct figure of profit of loss for the financial
year.
B. Secondary objective – it is also called the incidental
objective as it is incidental to the satisfaction of the main
objective. The incidental objective of auditing are: i.
Detection and prevention of Frauds, and ii. Detection and
prevention of Errors.
 Income Tax
Income tax is tax on income. Income tax is a central subject
according to the Constitution of India. Income tax is a very
important direct tax. It is an important and most significant
source of revenue of the Government. The government needs
money to maintain law and order in the country; safeguard
the security of the country from foreign powers and promote
the welfare of the people. It is the foremost duty of the
government to bring out such welfare and development
programmes which will bridge the gap between the rich and
the poor. For this purpose, mobilization of funds from various
sources is required. These sources may be direct or indirect.
Income tax is one of the most important tools to achieve
balanced socio-economic growth.
 Objectives of Income Tax

The objectives of income tax may be –

1. To reduce inequalities in the distribution of
income and wealth.
2. To bring out equity between classes of tax payers.
3. To accelerate the economic growth and
development of country.
4. To make available of funds for economic
development.
5. To encourage investment in new capital goods.
6. To channelize investment into those sectors which
contribute the most economic growth.
The Balance Sheet (Also known as a “Statement of Financial Position”)

Definition: A statement of the assets, liabilities, and capital of a business or

other organization at a particular point in time, detailing the balance of
income and expenditure over the preceding period.

Overview: The balance sheet - also called the Statement of Financial Position
- serves as a snapshot, providing the most comprehensive picture of an
organization's financial situation. It reports on an organization's assets (what
is owned) and liabilities (what is owed). The net assets (also called equity,
capital, retained earnings, or fund balance) represent the sum of all annual
surpluses or deficits. The balance sheet also indicates an organization's
liquidity by communicating how much cash an organization has at present
and what assets will soon be available in the form of cash.
Recording transaction
Recording transaction is a basic accounting process, with a few steps
involved. The first step is to determine the transaction and which accounts it
will affect. The second step is recording in the particular accounts.
Consideration must be taken when numbers are inputted into the debit and
credit sections.
Summarizing function of accounting.
The summarizing phase of accounting involves summarizing the data after each
accounting period, such as a month, quarter or year. The data must be presented
in a manner which is easy to understand and use by both external and internal
users of the accounting statements.

Financial accounting classifying

The financial statements used in financial accounting present the five main
classifications of financial data: revenues, expenses, assets, liabilities and equity.
Revenues and expenses are accounted for and reported on the income statement.

Financial analysis
Financial analysis is the process of evaluating businesses, projects, budgets, and
other finance-related transactions to determine their performance and
suitability. Typically, financial analysis is used to analyze whether an entity is
stable, solvent, liquid, or profitable enough to warrant a monetary investment.
Definitions

In order to understand the subject matter with

clarity, let us study some of the definitions which
depict the scope, content and purpose of
Accounting. The field of accounting is generally
sub-divided into:
(a) Book-keeping
(b) Financial Accounting
(c) Cost Accounting and
(d) Management Accounting
Financial Accounting

It is commonly termed as Accounting. The American Institute

of Certified Public Accountants defines Accounting as “an art
of recoding, classifying and summarizing in a significant
manner and in terms of money, transactions and events
which are in part at least of a financial character, and
interpreting the results thereof.” The first step in the cycle of
accounting is to identify transactions that will find place in
books of accounts. Transactions having financial impact only
are to be recorded. E.g. if a businessman negotiates with the
customer regarding supply of products, this will not be
recorded. The negotiation is a deal which will potentially
create a transaction and will have exchange of money or
money’s worth. But unless this transaction is finally entered
into, it will not be recorded in the books of accounts.
Thank You