WELCOME TO OUR PRESENTATION

• Md. Enamul Islam Shemul
• Student of Patuakhali Science and
Technology University
• Faculty of Business Administration and
Management
• Session 2013-14

Our selected topic name is “The process of
issuing audit report by CA firm”

Introduction
Auditing is a vital issue in an organization especially in public limited
companies. Audits are most effective when performed by qualified
professionals who work together and are focused on clear objectives.
The project nature of audits, the professional characteristics of the
Audit Firm’s staff and the advanced communication technology
available to auditors make it possible for teams to function effectively.
Each audit can be viewed as a project, an activity with a start and
finish. A team is formed to accomplish the project. Everyone who will
participate in the project is part of the team. This includes staff
auditors, support staff, senior auditors, supervisors, and managers at
both the regional and headquarters levels. Team members are valued
for their knowledge. All audits are conducted in accordance with
government auditing standards; and, as applicable, in compliance with
State and local laws and regulations.

Objectives of the study
The main objective of the study is to analyze the
procedure of providing an audit report. Based on this
specific objective, the following complementary
objectives will be highlighted-
 To know how preparing audit report.
 To know how the audit procedure
 To identify about how to accumulate and process evidences to
make an audit report.
 To know how the audit engagement procedure occurred with
the audit firm
 To know how they maintain audit activities.

Methodology of the Study
The preparation of the report provides some
understandings on “Audit procedure” in
Bangladesh. The information is collected from
Secondary sources.
Information collected from audit working
papers
Information collected from various
publications, books, files and Internet

Organizational Profile
G. KIBRIA & CO. is one of the Bangladesh’s leading professional services firm,
provides audit, tax, corporate risk services, financial advisory and consulting
to a wide range of local and multinational clients. The firm was established in
the year 1983 under the Institute of Chartered Accountants of Bangladesh
(ICAB), and it has become one of the leading professional services firm in
Bangladesh. The firm is providing service to its clients including both
multinational and local companies. The firm has significant presence across
manufacturing, services, commercial, financial, non-government organization
and public sector entities in the country. The firm has been classified as “A”
category firm by the Bangladesh Bank. The firm has been selected as panel
external auditor of Bangladesh Security Exchange Commission (BSEC), panel
valuer of Bangladesh Security Exchange Commission (BSEC).

Audit Process
Each and every company maintains their own internal
accounting system. Though they have their own
accounting system but at the end of the day an
independent audit firm checks all their workings and
provides opinion about true and fairness of their
accounts.
Audit process suggested by Audit Practice Manual (APM)
may be summarized as follows
• 1. Planning.
• 2. Collection of evidence.
• 3. Controlling and recording.
• 4. Review and opinion

Planning
Before any work planning is essential which will lead to
success. However, in our profession planning is the key
measures. An audit planning is more detailed than the
strategy and sets out the nature, timing and extent of audit
procedures to be performed by the engagement team
members in order to obtain sufficient appropriate audit
evidence.
Planning document includes about the company and its
business.
 What the entity does?
 How it conducts its business?
 What are the risks and where?
 How the auditors are going to audit the company?

Collection of audit evidence
The audit program manual describes how to get an
effective collection of evidence from the clients. It is
a very crucial task for the auditor to collect
documents for the client because sometimes the
internal management does not cooperate with the
auditors.
Audit Tests:
Audit tests are referred to in practice by a variety of
names. Generally, audit tests can be divided into
two types, compliance and substantive tests.

Audit Documentation
The written record of the basis for the auditor’s conclusions
that provides the support for the auditor's representations,
whether those representations are contained in the auditor's
report or otherwise.
• Objectives of audit documentation:
– Improve audit quality
– Enhance public confidence
• Contents of audit documentation:
– Planning and performance of the work
– Procedures performed
– Evidence obtained
– Conclusions reached by the auditor

Filling working paper:
For the proper handling of the audit we divide the records
into two files-
• Permanent audit files contain information of continuing
importance to the audit.
• Current audit files contain information of relevance to the
current year’s audit.
Audit report:
The auditor's report is a formal opinion, or disclaimer thereof,
issued by either an internal auditor or an independent
external auditor as a result of an internal or external audit or
evaluation performed on a legal entity or subdivision thereof
(called an "auditee").

Elements of an Audit Report:
The audit report should include the following basic
elements, usually in the following layout:
• Title
• Address
• Introductory paragraph
• Scope paragraph
• Opinion paragraph
• Date of the report
• Auditor's address
• Auditor's signature

Controlling and recording
Audit Evidence:
Audit evidence includes all the information contained within the accounting
records underlying the financial statements, and other information gathered
by the auditors, such as confirmations from third parties.
Quality of evidence:
• External Audit evidence from external sources is more reliable than that
obtained from the entity's records
• Auditor Evidence obtained directly by auditors is more reliable than that
obtained indirectly or by inference
• Entity Evidence obtained from the entity's records is more reliable when
related control systems operate effectively
• Written Evidence in the form of documents (paper or electronic) or
written representations are more reliable than oral representations
• Originals Original documents are more reliable than photocopies, or
facsimiles

Assessment of Risk
Audit risk is present in the giving of any audit
opinion on financial statements. Elements of audit
risk include those arising:
• from the business environment in which the
entity operates;
• from the operation of the entity's control
systems; or
• From the failure of audit procedures, including
'sampling risk'.

Review and opinion
This section deals with how partner can review
the overall audit and form an opinion. Auditing
Program Manual provides some checklists which
can be used to review the overall performance
of the client.

How Does A CA Firm Accept Audit Engagements?
Consider Reputational Risks
When deciding whether to accept a new
engagement, audit firms carefully consider the
reputation and integrity of company management.
Consider Requisite Auditor Expertise
During the engagement acceptance process, the
audit firm also evaluates whether it has the
necessary industry-specific expertise (e.g., energy,
biotechnology, or financial services) and resources
to perform the engagement with competence and
due professional care.

Consider Auditor Independence
Public company auditors are subject to strict independence rules as
promulgated by the BSEC. As such, a firm will review the investment holdings,
business and personal relationships of its partners and professionals, and
other matters of the firm and its personnel to make sure it is independent
and free from relationships that would prevent its auditors from, in fact or
appearance, objectively performing the audit.
Continuance of Engagement
Each year prior to the commencement of a recurring audit, the audit firm
updates its understanding of the engagement, the company’s management,
and its own capabilities to determine whether the firm should continue
serving as independent auditors. Companies are constantly evolving and, as a
result, it is important to reassess the prudence of continuing to be associated
with a particular company on an ongoing basis.

Types of Audit report
Standard unqualified: Auditors frequently issue the standard unqualified
audit report opinion.
Unqualified report with explanatory paragraph Auditors may issue the
unqualified audit report with explanatory paragraph or modified wording
report.
Qualified Audit report or Opinion: Qualified opinion report can result from a
limitation on the scope of the audit or failure to follow generally accepted
accounting principles.
Adverse Audit Report or Opinion: It is used only when the auditor believes
that the overall financial statements are so materially misstated or misleading
that they do not present fairly the financial position or results of operations
and cash flows in conformity of generally accepted accounting principles.
Disclaimer of Audit Report or Opinion: It is issued when the auditor is unable
to be satisfied that the overall financial statements are fairly presented.

True and Fair View
True: Information is factual and conforms to
reality, not false. In addition the information
conforms to required standards and law. The
accounts have been correctly extracted from the
books and records.
Fair: Information is free from discrimination and
bias in compliance with expected standards and
rules. The accounts should reflect the
commercial substance of the company’s
underlying transactions.

Findings
• Auditing is an organized and systematic process.
• From Pre-Engagement to Reporting, all auditing
process steps need to be maintained step by step.
• In Pre-Engagement meeting a total framework of audit
process needs to be drawn.
• Good communication must exist between the audit
team members and audit committee, the organization
being audited.
• Audit Risk must be assessed properly - important to
meet the audit standards concerning errors,
irregularities and illegal acts.
• The auditor gives his opinion true and fair view.

Conclusion
Both science and art, the independent audit is a wide-ranging,
complex undertaking that calls upon not just technical expertise
but also a skeptical mindset and the willingness to exercise
professional judgment. High-quality financial reporting plays an
important role in promoting the integrity and reliability of the
financial information that is the lifeblood of our capital markets.
A comprehensive, quality financial reporting framework,
overseen by an independent audit committee of the board,
helps promote continuous improvement to the audit process
that will enable audits to remain effective even in the face of a
rapidly changing business environment.

THANKS TO ALL