SR.

NO

INDEX
1

GENERAL CONSIDERATION IN COMPANY AUDIT

CONSTITUTIONAL DOCUMENTS

BUY BACK OF SHARES

a)
b)
c)
d)
e)
f)
g)
h)
i)
j)
k)

Objectives of Buy Back:

Resources of Buy Back
Conditions of Buy Back
Disclosures in the explanatory statement
Sources from where the shares will be purchased
Register of Securities Bought Back
Issue of further shares after Buy back
Filing of return with the Regulator
Prohibition of Buy Back
Procedure for buy back
Penalty

TRANSMISSION OF SHARES
SA 200 Overall objectives of the independent auditor and the
conduct of an

audit in accordance with SA

4
5

a) Scope of this SA:

b) Overall Objectives of the Auditor:
c) Requirements

SA 200 A Objective and scope of Audit of Financial Statements

a) Preparation of the Financial Statements
b) Ethical Requirements Relating to an Audit of Financial
6

Statements
c) Professional Skepticism
SA 230 Audit Documentation
a) Scope of this SA
b) Nature and Purposes of Audit Documentation

c) Audit documentation serves a number of additional

d)
e)
f)
g)

purposes
Effective Date
Objective
Definitions
Requirements

STATUTORY REPORT OF MMTC LTD

REFERENCES

8
9

COMPANY AUDIT

1. GENERAL CONSIDERATION IN COMPANY AUDIT

These have to be determined on a consideration of :

(a) objectives of audit;
(b) various provisions in the Companies Act, 1956, especially those
concerning accounts and audit; and
(c) the scope of the report that the auditor of a company is required to make
in pursuance of the provisions contained in section 227 of the Act.

The objectives of an audit are :

(i) Verification of statements of account so as to express an opinion;
(ii) Detection of errors and frauds; and
(iii) Prevention of occurrence of errors and frauds.
Detection and prevention of frauds and errors were originally regarded as the
main objectives of an audit.
While conducting the audit, the auditor is expected to bear in mind the
possibility of existence of a fraud or other irregularity in accounts.
Nonetheless, he is not expected to conduct the audit with the objective of
discovering all frauds or irregularities, for if that is to be done, the audit
would take an unduly long time and the cost of it would be quite out of
proportion to its benefit.

Nevertheless, it is expected that the auditor would be vigilant and watchful

and whenever he comes across a circumstance which arouses his suspicion,
he should find out whether a fraud, or irregularity, in fact does exist and, if
so, whether it is sufficiently material to necessitate qualifications of the audit
report.
It is generally accepted that the auditor is not an insurer and does not
guarantee that the books of account truly reflect the companys affairs.
The auditor, thus, is principally responsible for carrying out his duties by
exercising due care and skill in consonance with the professional standards.
If, despite the fact, any fraud or irregularity in accounts remains undetected,
he cannot be held liable for the failure to detect it. Moreover, since the
management is primarily responsible for safeguarding the assets and
property of the company, the auditor, while framing his audit program, is
entitled to rely upon the internal controls in this regard instituted by the
management based on a proper evaluation.
It would be observed that Companies Act, 1956 also does not contemplate
that an auditor is responsible for the detection of errors and frauds, except
when they are so material as to vitiate the opinion expressed by him that
statements of account exhibit a true and fair state of affairs.
The auditor is required to verify the final statements of account; also to
check or verify all the matters affecting them so as to ensure fully that they
exhibit a true and fair state of affairs of the business of the company. For the
purpose, he may either carry out a detailed examination of the books or
relying on the internal control measures in operation, after testing their
strength, merely test the accuracy of transaction recorded therein.
It is permissible for an auditor to verify the accuracy of transactions recorded
in the books of account by the application of test checks, if he is satisfied
that the system of internal control, in operation, is adequate and satisfactory.

2. CONSTITUTIONAL DOCUMENTS
The

auditor,

before

commencing

company

audit,

shall

undertake

Verification of the constitution and powers. This he can verify from various
documents, decisions taken in board meeting, decisions in shareholders
meeting etc.
Any companys functions and powers are limited to the documents on the
basis of which it has been registered. Prospectus is the most important
document that the company requires to raise capital from public. The auditor
also needs to check various transactions taken place before commencement
of business eg, any property purchased etc. thus, prior to setting any audit,
the auditor shall examine following constitutional documents :
1. Memorandum of association
2. Articles of association
3. Contracts entered into with vendors and other persons relating to
purchase of property, payment of commission etc.
4. Certificate of commencement by business
5. Certificate of registration etc.
A company, before registration, cannot enter into contract also without
obtaining Certificate of Commencement of business from the registrar of
Companies. Therefore, the auditor is required to take into account his duty to
examine the transactions entered into by the company; the dates when
these were entered into for confirming the validity. The auditor should be
aware of the authority structure of the company so as to carry out audit
effectively. Section 291 empowers the Board of Directors to exercise all such
powers and undertake all such Acts, the company is authorized to do. But,
the auditor should see to it that the Board has not done any ultra-vires Acts

i.e. not exercised any power nor done any act which is not permitted by
Memorandum or Articles of the company.

3. BUY BACK OF SHARES

The provisions regulating buy back of shares are contained in Section 77A,
77AA and 77B of the Companies Act,1956. These were inserted by the
Companies (Amendment) Act,1999. The Securities and Exchange Board of
India (SEBI) framed the SEBI(Buy Back of Securities) Regulations,1999 and
the Department of Company Affairs framed the Private Limited Company and
Unlisted Public company (Buy Back of Securities) rules,1999 pursuant to
Section 77A(2)(f) and (g) respectively.
The repurchase of outstanding shares (repurchase) by a company in order to
reduce the number of shares on the market. Companies will buy back shares
either to increase the value of shares still available (reducing supply), or to
eliminate any threats by shareholders who may be looking for a controlling
stake.
A buyback allows companies to invest in themselves. By reducing the
number of shares outstanding on the market, buybacks increase the
proportion of shares a company owns. Buybacks can be carried out in two
ways:
1. Shareholders may be presented with a tender offer whereby they have the
option to submit (or tender) a portion or all of their shares within a certain
time frame and at a premium to the current market price. This premium
compensates investors for tendering their shares rather than holding on to
them.

2. Companies buy back shares on the open market over an extended period
of time.

3.1) Objectives of Buy Back:

Shares may be bought back by the company on account of one or more of
the following reasons
i.
ii.
iii.

To increase promoters holding

Increase earning per share
Rationalise the capital structure by writing off capital not represented

iv.
v.
vi.

by available assets.
Support share value
To thwart takeover bid
To pay surplus cash not required by business

Infact the best strategy to maintain the share price in a bear run is to buy
back the shares from the open market at a premium over the prevailing
market price.

3.2) Resources of Buy Back

A Company can purchase its own shares from
(i)

Free reserves; Where a company purchases its own shares out of free
reserves, then a sum equal to the nominal value of the share so
purchased shall be transferred to the capital redemption reserve and
details of such transfer shall be disclosed in the balance-sheet or

(ii)

Securities premium account; or

(iii)

Proceeds of any shares or other specified securities. A Company cannot

buyback its shares or other specified securities out of the proceeds of
an earlier issue of the same kind of shares or specified securities.

3.3) Conditions of Buy Back

(a)

The buy-back is authorised by the Articles of association of the

Company;
(b)

A special resolution has been passed in the general meeting of the

company authorising the buy-back. In the case of a listed company,
this approval is required by means of a postal ballot. Also, the shares
for buy back should be free from lock in period/non transferability. The
buyback can be made by a Board resolution If the quantity of buyback
is or less than ten percent of the paid up capital and free reserves;

(c)

The buy-back is of less than twenty-five per cent of the total paid-up
capital and fee reserves of the company and that the buy-back of
equity shares in any financial year shall not exceed twenty-five per
cent of its total paid-up equity capital in that financial year;

(d)

The ratio of the debt owed by the company is not more than twice the
capital and its free reserves after such buy-back;

(e)

There has been no default in any of the following

i.
ii.
iii.

In repayment of deposit or interest payable thereon,

Redemption of debentures, or preference shares or
Payment of dividend, if declared, to all shareholders within the
stipulated time of 30 days from the date of declaration of dividend

iv.

or
Repayment of any term loan or interest payable thereon to any
financial institution or bank;

(f)

There has been no default in complying with the provisions of filing of

Annual Return, Payment of Dividend, and form and contents of Annual
Accounts;

(g)

All the shares or other specified securities for buy-back are fully paid-

up;
(h)

The buy-back of the shares or other specified securities listed on any

recognised stock exchange shall be in accordance with the regulations
made by the Securities and Exchange Board of India in this behalf; and

(i)

The buy-back in respect of shares or other specified securities of

private and closely held companies is in accordance with the guidelines
as may be prescribed.

3.4) Disclosures in the explanatory statement

The notice of the meeting at which special resolution is proposed to be
passed shall be accompanied by an explanatory statement stating o a full and complete disclosure of all material facts;
o the necessity for the buy-back;
o the class of security intended to be purchased under the buyback;
o the amount to be invested under the buy-back; and
o the time-limit for completion of buy-back

3.5) Sources from where the shares will be purchased

The securities can be bought back from
(a) existing security-holders on a proportionate basis;
Buyback of shares may be made by a tender offer through a letter of offer
from the holders of shares of the company or
(b) the open market through
i.
ii.

book building process;

stock exchanges or

(c) odd lots, that is to say, where the lot of securities of a public company,
whose shares are listed on a recognized stock exchange, is smaller than such
marketable lot, as may be specified by the stock exchange; or
(d) purchasing the securities issued to employees of the company pursuant
to a scheme of stock option or sweat equity.

3.6) Register of Securities Bought Back

After completion of buyback, a company shall maintain a register of the
securities/shares so bought and enter therein the following particulars
a.

The consideration paid for the securities bought-back,

b.

The date of cancellation of securities,

c.

The date of extinguishing and physically destroying of securities and

d.

Such other particulars as may be prescribed

Where a company buys-back its own securities, it shall extinguish and

physically destroy the securities so bought-back within seven days of the last
date of completion of buy-back.

3.7) Issue of further shares after Buy back

Every buy-back shall be completed within twelve months from the date of
passing the special resolution or Board resolution as the case may be.
A company which has bought back any security cannot make any issue of
the same kind of securities in any manner whether by way of public issue,
rights issue up to six months from the date of completion of buy back.

3.8) Filing of return with the Regulator

A Company shall, after the completion of the buy-back file with the Registrar
and the Securities and Exchange Board of India, a return in form 4 C
containing such particulars relating to the buy-back within thirty days of such
completion.
No return shall be filed with the Securities and Exchange Board of India by an
unlisted company.

3.9) Prohibition of Buy Back

A company shall not directly or indirectly purchase its own shares or other
specified securities (a)

Through

any

subsidiary

company

including

its

own

subsidiary

companies; or
(b)

Through any investment company or group of investment companies;

3.10) Procedure for buy back

a.

Where a company proposes to buy back its shares, it shall, after

passing of the special/Board resolution make a public announcement at
least one English National Daily, one Hindi National daily and Regional
Language Daily at the place where the registered office of the
company is situated.

b.

The public announcement shall specify a date, which shall be

specified date for the purpose of determining the names of
shareholders to whom the letter of offer has to be sent.

c.

A public notice shall be given containing disclosures as specified in

Schedule I of the SEBI regulations.

d.

A draft letter of offer shall be filed with SEBI through a merchant

Banker. The letter of offer shall then be dispatched to the members of
the company.

e.

A copy of the Board resolution authorising the buy back shall be filed
with the SEBI and stock exchanges.

f.

The date of opening of the offer shall not be earlier than seven days or
later than 30 days after the specified date

g.

The buy back offer shall remain open for a period of not less than 15
days and not more than 30 days.

h.

A company opting for buy back through the public offer or tender offer
shall open an escrow Account.

3.11) Penalty
If a company makes default in complying with the provisions the company or
any officer of the company who is in default shall be punishable with
imprisonment for a term which may extend to two years, or with fine which
may extend to fifty thousand rupees, or with both. The offences are, of
course compoundable under Section 621A of the Companies Act,1956.

4) TRANSMISSION OF SHARES
Share transmission is a mechanism by which the title to shares is devolved
other than by transfer. This is typically applicable for:

Devolution by death
Succession
Inheritance
Bankruptcy
Marriage

Ownership: On registration of the transmission of shares, the person

entitled to transmission of shares becomes the shareholder of the company
and is entitled to all rights and subject to all liabilities as such shareholder.

Method: While transfer of shares is brought about by delivery of a proper

instrument of transfer (viz, transfer deed) duly stamped and executed,
transmission of shares is done by forwarding the necessary documents (such
as a notarised copy of death certificate) to the company.

5) SA 200
Overall Objectives of the Independent Auditor and The Conduct
of an Audit in Accordance with Standards on Auditing

5.1) Scope of this SA:

This Standard on Auditing (SA) establishes the independent auditors overall
responsibilities when conducting an audit of FS in accordance with SAs.
Specifically, it sets out the overall objectives of the independent auditor, and
expains the nature and scope of an audit designed to enable the independen
t auditor to meet those.

5.2) Overall Objectives of the Auditor:

In conducting an audit of financial statements, the overall objectives of the a
uditor are

(a) To obtain reasonable assurance about whether the FS as a whole are free
from material misstatement, and
(b) To report on the financial statements, and communicate as required by th
e SAs, in accordance with the auditors findings.

5.3) Requirements
i) Ethical Requirements Relating to an Audit of FS
The auditor shall comply with relevant ethical requirements, including those
pertaining to
independence, relating to financial statement audit engagements.
Relevant ethical requirements ordinarily comprise the Code of Ethics issued b
y the Institute of Chartered Accountants of India. The Code establishes the fo
llowing as the fundamental principles of professional
ethics relevant to the auditor
(a) Integrity;
(b) Objectivity;
(c) Independence
(d) Professional competence and due care
(e) Confidentiality; and
(f) Professional behavior.
ii) Professional Skepticism
(a)The auditor shall plan and perform an audit with professional skepticism
recognising that circumstances may exist that cause the financial statements
to be materially misstated.

(b) Professional skepticism includes being alert to, for example

Audit evidence that contradicts other audit evidence obtained.
Conditions that may indicate possible fraud.

iii) Professional Judgment

The auditor shall exercise professional judgment in planning and performing
an
audit of financial statements. Professional judgment is essential to the proper
conduct of an audit. Professional judgment is necessary in particular reg
arding

decisions about:

Materiality and audit risk.

The nature, timing, and extent of audit procedures used to meet the
requirements of the SAs and gather audit evidence.
Evaluating whether sufficient appropriate audit evidence has been obt
ained.

iv) Sufficient Appropriate Audit Evidence and Audit Risk

To obtain reasonable assurance, the auditor shall obtain sufficient appropriat
e audit evidence to reduce audit risk to an acceptably low level and thereby
enable the

auditor to draw reasonable conclusions on which to base the auditors opinio

n.
a)Audit evidence is necessary to support the auditors opinion and repo
rt. It
is cumulative in nature and is primarily obtained from audit procedure
s

performed during the course of the audit.

b)The sufficiency and appropriateness of audit evidence are interrelate

d.
Sufficiency is the measure of the quantity of audit evidence. The quanti
ty of audit evidence needed is affected by the auditors assessment of
the risks of misstatement (the higher the assessed risks, the more audi
t evidence is likely to be required) and also by the quality of such audit
evidence (the higher the quality, the less may be required). Obtaining
more audit evidence, however, may not compensate for its poor quality
.
c)Appropriateness is the measure of the quality of audit evidence;that i
s, its relevance and its reliability in providing support for the conclusion
s on which the auditors opinion is based. The reliability of evidence is i
nfluenced by it source and by its nature, and is dependent on the indivi
dual circumstances under which it is obtained.
d)Whether sufficient appropriate audit evidence has been obtained to r
educe audit risk to an acceptably low level, and thereby enable the aud
itor to draw reasonable conclusions on which to base the auditors opin
ion, is a matter of professional judgment.

v) Conduct Of an Audit in accordance with SAs

1. Complying with SAs Relevant to the Audit

a.The auditor shall comply with all SAs relevant to the audit. An SA is
relevant to the audit when the SA is in effect and the circumstances ad
dress by the SA exist.
b.The auditor shall have an understanding of the entire text of an SA,
including its application and other explanatory material, to understand
its

objectives and to apply its requirements properly.

c.The auditor shall not represent compliance with SAs in the auditors r
eport unless the auditor has complied with the requirements of this SA and al
l

other SAs relevant to the audit.

2. Objectives Stated in IndividuaI SAs

To achieve the overall objectives of the auditor, the auditor shall use the Obje
ctives stated in relevant SAs in planning and performing the audit, having re
gard to the interrelationships among the SAs,
(a)
Determine whether any audit procedures in addition to those required
by the SAs are necessary in pursuance of the objectives stated in the S
As; and
(b)Evaluate whether sufficient appropriate audit evidence has been obt
ained.

3. Complying with Relevant Requirements

The auditor shall comply with requirement of an SA unless, in the circumstan

ces of the audit:
(a) The entire SA is not relevant; or
(b)The requirement is not relevant because it is conditional and the con
dition

does not exist.

4. Failure to Achieve an Objective

If an objective in a relevant SA cannot be achieved, the auditor shall evaluate
whether this prevents the auditor from achieving the overall objectives o
f the auditor and thereby requires the auditor, in accordance with the SAs, to
modify the
auditors opinion or withdraw frm the engagement. Failure to achieve an obje
ctive represents a significant matter requiring documentation in accordance
with SA 230

6) SA 200 AObjectives and scope of Audit of Financial Statements

The auditors opinion on the financial statements deals with whether the
financial
statements are prepared, in all material respects, in accordance with the
applicable financial reporting framework. Such an opinion is common to all
audits of financial statements. The auditors opinion therefore does not
assure, for example, the future viability of the entity nor the efficiency or
effectiveness with which management has conducted the affairs of the
entity.
In some cases, however, the applicable laws and regulations may require
auditors to provide opinions on other specific matters, such as the
effectiveness

of

internal

control,

or

the

consistency

of

separate

management report with the financial statements. While the SAs include
requirements and guidance in relation to such matters to the extent that
they are relevant to forming an opinion on the financial statements, the
auditor would be required to undertake further work if the auditor had
additional responsibilities to provide such opinions.

6.1) Preparation of the Financial Statements

An audit in accordance with SAs is conducted on the premise that
management and, where appropriate, those charged with governance have
responsibility:
(a) For the preparation and presentation of the financial statements in
accordance with the applicable financial reporting framework; this includes
the design, implementation and maintenance of internal control relevant to
the preparation and presentation of financial statements that are free from
material misstatement, whether due to fraud or error; and
(b) To provide the auditor with:
(i) All information, such as records and documentation, and other
matters that are relevant to the preparation and presentation of the
financial statements;

(ii) Any additional information that the auditor may request from
management and, where appropriate, those charged with governance;
and
(iii) Unrestricted access to those within the entity from whom the
auditor determines it necessary to obtain audit evidence.
As part of their responsibility for the preparation and presentation of the
financial
statements, management and, where appropriate, those charged with
governance are responsible for:
The identification of the applicable financial reporting framework, in
the context of any relevant laws or regulations.
The preparation and presentation of the financial statements in
accordance with that framework.
An adequate description of that framework in the financial
statements.
The preparation of the financial statements requires management to exercise
judgment in making accounting estimates that are reasonable in the
circumstances, as well as to select and apply appropriate accounting
policies. These judgments are made in the context of the applicable financial
reporting framework.

6.2)

Ethical

Requirements

Relating

to

an

Audit

of

Financial

Statements
The auditor is subject to relevant ethical requirements, including those
pertaining

to

independence,

relating

to

financial

statement

audit

engagements. Relevant ethical requirements ordinarily comprise the Code of

Ethics issued by the Institute of Chartered Accountants of India.
The Code establishes the following as the fundamental principles of
professional ethics relevant to the auditor when conducting an audit of
financial statements and provides a conceptual framework for applying those
principles;
(a) Integrity;
(b) Objectivity;
(c) Professional competence and due care;
(d) Confidentiality; and
(e) Professional behavior.
In the case of an audit engagement it is in the public interest and, therefore,
required by the Code of Ethics, that the auditor be independent of the entity
subject to the audit. The Code describes independence as comprising both
independence of mind and independence in appearance. The auditors
independence from the entity safeguards the auditors ability to form an
audit opinion without being affected by influences that might compromise
that opinion. Independence enhances the auditors ability to act with
integrity, to be objective and to maintain an attitude of professional
skepticism.
6.3) Professional Skepticism
Professional skepticism includes being alert to, for example:
Audit evidence that contradicts other audit evidence obtained.
Information that brings into question the reliability of documents and
responses to inquiries to be used as audit evidence.
Conditions that may indicate possible fraud.

 Circumstances that suggest the need for audit procedures in addition

to those required by the SAs.
Maintaining professional skepticism throughout the audit is necessary if the
auditor is, for example, to reduce the risks of:
Overlooking unusual circumstances.
Over generalising when drawing conclusions from audit observations.
Using inappropriate assumptions in determining the nature, timing,
and extent of the audit procedures and evaluating the results thereof.
Professional skepticism is necessary to the critical assessment of audit
evidence. This includes questioning contradictory audit evidence and the
reliability of documents and responses to inquiries and other information
obtained from management and those charged with governance. It also
includes consideration of the sufficiency and appropriateness of audit
evidence obtained in the light of the circumstances, for example in the case
where fraud risk factors exist and a single document, of a nature that is
susceptible to fraud, is the sole supporting evidence for a material financial
statement amount.
7. SA 230(REVISED)
AUDIT DOCUMENTATION
7.1) Scope of this SA
This Standard on Auditing (SA) deals with the auditors responsibility to
prepare audit documentation for an audit of financial statements. It is to be
adapted as necessary in the circumstances when applied to audits of other
historical financial information. The specific documentation requirements of
other SAs do not limit the application of this SA. Laws or regulations may
establish additional documentation requirements.

7.2) Nature and Purposes of Audit Documentation

Audit documentation that meets the requirements of this SA and the specific
documentation requirements of other relevant SAs provides:
(a) Evidence of the auditors basis for a conclusion about the achievement of
the overall objective of the auditor; and
(b) Evidence that the audit was planned and performed in accordance with
SAs and
applicable legal and regulatory requirements.
7.3) Audit documentation serves a number of additional purposes,
including the following:
Assisting the engagement team to plan and perform the audit.
Assisting members of the engagement team responsible for
supervision to direct and supervise the audit work, and to discharge
their review responsibilities in accordance with Proposed SA 220
(Revised)1.
Enabling the engagement team to be accountable for its work.
Retaining a record of matters of continuing significance to future
audits.
Enabling the conduct of quality control reviews and inspections in
accordance with SQC 1.
Enabling the conduct of external inspections in accordance with
applicable legal, regulatory or other requirements.
7.4) Effective Date
This SA is effective for audits of financial statements for periods beginning on
or after April 1, 2009.
7.5) Objective
The objective of the auditor is to prepare documentation that provides:

(a) A sufficient and appropriate record of the basis for the auditors report;
and
(b) Evidence that the audit was planned and performed in accordance with
SAs and
applicable legal and regulatory requirements.
7.6) Definitions
For purposes of the SAs, the following terms have the meanings attributed
below:
(a) Audit documentation The record of audit procedures performed,
relevant audit evidence obtained, and conclusions the auditor reached
(terms such as working papers or workpapers are also sometimes used).
(b) Audit file One or more folders or other storage media, in physical or
electronic

form,

containing

the

records

that

comprise

the

audit

documentation for a specific engagement.

(c) Experienced auditor An individual (whether internal or external to the
firm) who has practical audit experience, and a reasonable understanding of:
(i) Audit processes;
(ii) SAs and applicable legal and regulatory requirements;
(iii) The business environment in which the entity operates; and
(iv) Auditing and financial reporting issues relevant to the entitys
industry.
7.7) Requirements
1) Timely Preparation of Audit Documentation
The auditor shall prepare audit documentation on a timely basis.
2) Form, Content and Extent of Audit Documentation

The auditor shall prepare audit documentation that is sufficient to enable an

experienced auditor, having no previous connection with the audit, to
understand:
(a) The nature, timing, and extent of the audit procedures performed to
comply with the SAs and applicable legal and regulatory requirements;
(b) The results of the audit procedures performed, and the audit evidence
obtained; and
(c) Significant matters arising during the audit, the conclusions reached
thereon, and significant professional judgments made in reaching those
conclusions.
3) Departure from a Relevant Requirement
If, in exceptional circumstances, the auditor judges it necessary to depart
from a relevant requirement in a SA, the auditor shall document how the
alternative audit procedures performed achieve the aim of that requirement,
and the reasons for the departure.
4) Matters Arising after the Date of the Auditors Report
If, in exceptional circumstances, the auditor performs new or additional audit
procedures or draws new conclusions after the date of the auditors report,
the auditor shall document:
(a) The circumstances encountered;
(b) The new or additional audit procedures performed, audit evidence
obtained, and conclusions reached, and their effect on the auditors
report; and
(c) When and by whom the resulting changes to audit documentation
were made and reviewed.
5) Assembly of the Final Audit File
The auditor shall assemble the audit documentation in an audit file and
complete the administrative process of assembling the final audit file on a
timely basis after the date of the auditors report.

After the assembly of the final audit file has been completed, the auditor
shall not delete or discard audit documentation of any nature before the end
of its retention period.
In circumstances other than those envisaged in paragraph 13 where the
auditor finds it necessary to modify existing audit documentation or add new
audit documentation after the assembly of the final audit file has been
completed, the auditor shall, regardless of the nature of the modifications or
additions, document:
(a) The specific reasons for making them; and
(b) When and by whom they were made and reviewed.

STATUTORY REPORT OF MMTC LIMITED

REFERENCES

www.icai.org
www.caclubindia.com
www.mca.gov.in
www.knowledgebible.com
www.icaiknowledgegateway.org
www.investopedia.com
www.managementparadise.com