Auditors are a vital link in the financial reporting process because their opinion increases the trust in the minds of different stakeholders. At JKPP, we thrive to provide quality services that are industry-specific and tailor-made depending on the specific industry requirements, size and operations.
While providing our services, we adhere to high standards of independence, professionalism, integrity and ethical values. With increasing business desire and complication, our clients demand constant assistance for consulting and advisory on numerous commercial and accounting matters.
We benefit our clients to understand their organizations’ values and performance better to comfort them in achieving their true potential.
A taxpayer is required to have a tax audit carried out if the sales, turnover or gross receipts of business exceed Rs 1 crore in the financial year.Internal Audit:
Internal Audit is applicable to such class or classes of companies as prescribed under section 138 of Companies Act,2013
The purpose of a statutory audit is to determine whether an organization provides a fair and accurate representation of its financial position by examining information such as bank balances, bookkeeping records, and financial transactions. An Internal audit improves internal systems and controls. This will enable them to identify deficiencies in the accounting systems or controls for which recommendations can be made, making your business more efficient and less prone to fraud or error.
In India, statutory audits are conducted for each fiscal year (April 1 to March 31) and not the calendar year whereas an internal audit can be conducted on a daily, weekly, monthly or annual basis depending on the circumstance and schedule which fits a business’s needs best.
(1) A person shall be eligible for appointment as an auditor of a company only if he is a chartered accountant in practice.
(2) Where a firm is appointed as an auditor of a company, only the partners who are Chartered Accountants in practice shall be authorised by the firm to act and sign on behalf of the firm.
The scope of an audit is the determination of the range of the activities and the period of records that are to be subjected to an audit examination.
The basic difference can be laid out as:
An internal audit is conducted for the internal reporting to the management to improve the quality and productivity of the organization. The scope and objectives of the audit are solely decided by the management. A statutory audit is conducted by a firm appointed by the management but which is independent and reports to the concerned government body. The management’s interests are present, of course, but the purpose will be to report and adhere with the statutory laws.
Audit may be of two broad categories i.e., audit required under law (As per Companies Act, Banking Regulation Act, Income tax Act, etc.) and voluntary audits (Audit of accounts of proprietary entities, partnership firms, HUF, etc.)