Procedure for conducting an audit
In the course of the audit, the correctness of the balance sheet, profit and loss account is established, the accuracy of the explanations to them.
In doing so, determine: the completeness of the reflection of assets and liabilities in the report; use of all documents in the report.
The auditor checks the financial results of the financial statements in order to establish the correctness of the calculation of total (accounting) and taxable profits.
The auditor also needs to check:
• completeness of implementation of decisions of the owners of the enterprise on changes in the volume of the authorized capital;
• the identity of the data of synthetic and analytical accounting for assets and liabilities of the balance;
• Comprehensive reporting of accounts receivable and payable.
In the process of preparing an audit report, it is checked:
• compliance with the accounting policy adopted at the enterprise to reflect business transactions and property valuation;
• Correctness of attribution of income and expenses to reporting periods;
• differentiation in accounting for current production costs and capital investments;
• Ensuring the identity of the analytical accounting data for the turnover and balances on the analytical accounting accounts on the first day of each month.
The auditor should check the reality of the company's limitations in the ownership of assets, the degree of reliability of guarantees, data on liabilities, the level of reliability of contingent assets and liabilities quantified, verify the validity of the assumed amounts of liabilities against future capital expenditures.
When checking accounting and reporting data, the presence and status are analyzed:
• property (fixed assets and investments, stocks and costs, intangible assets);• other long-term assets (long-term investments, investments in subsidiaries and affiliates, in associates);
• Cash, settlements and other assets (cash, settlement and currency accounts, securities and short-term financial investments, settlements with participants, settlements with customers, debtors);
• long-term liabilities (share capital, depreciation of property, special funds and reserves);
• loans and other borrowed funds;
• Settlements and other liabilities (settlements with creditors, with the budget, insurance bodies, company personnel).
When verifying the correctness of determining the financial performance of the enterprise provides for studying: revenue (gross income) from the sale of products (works, services); costs for the production of products sold; results from financial activities and other non-sales operations.
When auditing financial statements, the correctness of the balance sheet, financial statements and other financial documents is checked. All significant transactions and transactions, major transactions and transactions registered at the end of the quarter or fiscal year, key financial indicators, ratios and target figures that differ from those calculated on average for the last and previous year, unsatisfactory working capital, revealed facts, evidence of an unreasonable need to sharply raise revenues to keep the stock of shares, the causes and nature of lawsuits to the enterprise, especially in connection with the claims of the shareholder c, the use of different forms of financial reporting in divisions of the enterprise.
When checking the use of profit, auditors analyze payments to the budget, deductions to the reserve fund, transfer of profits to accumulation funds, to the consumption fund, formation of a reserve fund, charitable and similar purposes, fines.
Special attention is paid to the analysis of accounts receivable and payable, the dynamics of long-term and short-term financial investments (in shares and shares of other enterprises, in bonds and other securities, loans granted, etc.).
The final document is an official audit report summarizing the results of the audit. The audit can not be considered complete until the audit recommendations are implemented and the identified deviations are corrected.
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