AUDITING STANDARDS
RTI, Jaipur
Introduction

Audit Mandate -

CAG’s (DPC) Act 1971 prescribes functions,
duties and powers of SAI

Audit Mandate includes Audit of

Receipt and Expenditure from

Consolidated Fund
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Introduction (contd….)

Contingency Fund and Public Accounts
 Trading, Manufacturing, Profit and Loss
Account and Balance Sheet
 Accounts of Stores and Stock
 Government Companies
 Statutory Corporations
 Authorities and Bodies substantially financed
 Grants and Loans for specific purposes
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Audit Objectives

To safeguard the financial interests of the
Government
 Uphold and promote public
accountability
 Sound and economical financial practices
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Audit assists
Parliament/Legislatures in
exercising financial control
 PACs/PUCs through
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Scope of Audit
Includes:
O Performance Audit
O Regularity Audit
 Financial Audit
 Compliance Audit
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Basic Postulates

Audit must exercise his best judgement in
determining  audit procedure
 basis of forming opinion
 contents of his report
 due professional care
 independence
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Auditing standards can be
broadly grouped under
1
General Standards
2
Operational Standards
3
Reporting Standards
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General Standards
A
Professional
B
Manuals and Instructions
C
Quality Assurance
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General Standards - Professional

Qualification
 Training
 Auditor should develop proper insight
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General Standards

Quality Assurance
 Appropriate internal control system to
ensure quality of work
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Operational Audit Standards
 Audit
Planning
 Financial
Statement Audit
 Regularity and
Legal Audit
 Performance Audit
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Operational Standards Audit Planning

Audit should be properly guided
 directed and
 supervised
 sufficient understanding of the internal
control system of the auditee organisation
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Operational Standards Financial Statements Audit

Financial Statements are accurate and
complete
 True and fair view
 prepared based on generally accepted
accounting principles
 sufficient disclosure
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Operational Standards Performance Audit

Achievement of physical and financial
goals and targets
 social and economic objects
 utilisation of resources as per projected
outlay
 cases of overpayment, losses, avoidable,
excess or infructuous expenditure due to
improper planning
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Operational Standards Performance Audit (contd..)

Delays in completion
 overstaffing
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Operational Audit Standards(contd)
Audit of Receipts
Audit of Government Companies
Auditing in EDP Environment
Audit Evidence
(i) Sufficiency
(ii) Relevance
(iii) Competence
RTI, Jaipur
Reporting Standards
Field Audit Report Observations and conclusions in an
appropriate form
Contents should be easy to understand
Report should be complete
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Reporting Standards (contd…)
 Accurate
 Convincing
 Clarity
 Concise
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Reporting Standards (contd…)

Report should be free from vagueness or
ambiguity
 relevant information
 supported by audit evidence
 timeliness
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Reporting Standards (contd…)

Follow up of Audit reports
 Adequate
 Prompt
 Proper
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Session Summary
In this session we discussed :
 CAG’s DPC Act
 Auditing Standards
RTI, Jaipur