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Auditing - Auditor’s Duties of Provisions | 12th Auditing : Chapter 8 : Reserves and Provisions

Chapter: 12th Auditing : Chapter 8 : Reserves and Provisions

Auditor’s Duties of Provisions

Examine Articles of Association, Examine Directors Meeting Minute Books

Auditor’s Duties


1. Examine Articles of Association: The auditor should examine the provisions of the Articles of Association to confirm the appropriations created for a specific purpose.

2. Examine Directors Meeting Minute Books: Auditor should examine the Minute Book of Board of Directors to verify the provisions to be made.

3. Disclosure in Financial Statements: He should ensure that all provisions are properly disclosed in the Profit and Loss Account and Balance Sheet.

4. Adequacy of Provision in Financial Statement: He should ensure that adequate provision has been shown in the financial statement. If in case, the provision created is not adequate, the auditor should mention the fact in the report.

5. Verification of Documents: The auditor should examine all the documents and ensure that the amount to be created as provision is adequate and sufficient to meet the loss or liability.

6. Utilisation for Specific Purpose: He has to ensure that the provisions created are utilized for the specific purpose for which they are created.

 

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