Presented by Group 4 #Advanced audit
For downloading this contact- bikashkumar.bk100@gmail.com
Prepared by Students of University of Rajshahi
Md. Aminul Islam Milon
Md. Maznur Rahman
Md. Tarikul Islam Tarif
Md. Mamunur Rahman
Subho Placid Besra
Rahid Hasan
Bikash Kumar
Md. Ali Haidar
Md. Alomgir Hosen
Khairul Basar
Risul Islam Tonu
Md. Asik Mahamud
Ahsan Ullah
Tanveer Shaharear
Md. Imran Hossain
Arif Hossain (leader)
Md. Aslam Hossain
Md. Faysal Alam
Md. Junayed
Md. Nazrul Islam
Md. Rasel Mollah
2. Definition of Auditor’s Report
An audit report may be defined as an organized statement of facts relating to
audit of books of account of the company prepared after an inquiry and
presented to the shareholders.
According to Lancaster “A report is a statement of collected and
considered facts, so drawn up to give clear and concise information to
persons who are not already in possession of the full facts of the
subject matter of the report.”
5. The importance of audit report can be described
from the two points of views:
2.From extarnal point of view1.From internal point of view
6. Importance of internal users
4
Proper
management
Implementation
of
future plan
3
Declaration of
dividends
2
Knowing true
and fear
information
Government
donation
1
5
7. Importance of external users
Tax Authority01
Help to future
investors
02
03
Help to invest04
Help to take loan05
Purchase of share06
Investigation07
Critical valuation08
Accurate data expression09
Professional advancement10
Tax Authority
8. 01
Title
02
Address
03
Identification of the financial statement
04
A reference to the auditing standards.
05
An expression or disclaimer of
opinion on the financial
statements.
Basic elements of Audit
Report
9. 06
An expression or disclaimer of opinion
on the financial statements.
07
Signature
08
The auditors address &
09
The date of the report.
10
An expression or disclaimer of
opinion on the financial
statements.
Con…...
10. Features of Audit Report
Systematic &
Scientific
Examinations
Configuration
ReferenceLogical
suggestion
Point out
mistake
Forceful
11. Features of Audit Report
01
Simplicity
02 03
Clarity
04
Brief
06
Unbiased opinion
05
Factual information
Unambiguous opinion
12. Auditors’ Responsibility
• Comply with applicable audit requirements
• Communicate and Clarity audit requirements
• Plan the audit and carry out assigned responsibilities effectively
and efficiently
• Document the observations
• Report the audit result
• Verify the effectiveness of corrective actions taken as a result of
the audit
• Retain and safeguard documents pertaining the audit
13. Management’s Responsibility for
the Financial Statements
Management is responsible for the preparation and fair
presentation of these consolidated financial statements of the
group and also the financial statements of the Bank in accordance
with Bangladesh Financial Reporting Standards (BFRS), Bank
Companies Act 1991, the rules and regulations issued by the
Bangladesh Bank, the Companies Act 1994, the Securities and
Exchanges Rules 1987 and other applicable laws and regulations.
This responsibility includes; designing, implementing and
maintaining internal control relevant to the preparation and fair
presentation of financial statements that are free from material
misstatement, whether due to fraud or error; selecting and
applying appropriate accounting policies, and making accounting
estimates that are reasonable in the circumstances.
14. Qualified Opinion
In our opinion, except for the effects of the matters described in
the Basis for Qualified Opinion Paragraphs 1 to 2, the financial
statements prepared in accordance with Bangladesh Financial
Reporting Standards (BFRS), give a true and fair view of the
financial position of the Group as well as the Bank as at 31
December 2012 and of the results of its financial performance
and its cash flows for the year then ended and comply with the
Bank Companies Act 1991, the rules and regulations issued by
the Bangladesh Bank, the Companies Act 1994, the Securities
and Exchanges Rules 1987 and other applicable laws and
regulations.
15. Emphasis of Matter for qualified
opinion
• In addition to our above qualified opinion, we draw attention to the
following facts:
• 1. Note 7.9 to the financial statements stated that some loans are not
classified and no provision has been provided due to High-Court
Injunction.
• 2. Note 14 to the financial statements stated that there is a shortfall of
capital in compliance
• with the requirements of BASEL II.
• 3. Note 7.10 to the financial statements stated that Hotel Sheraton
Corporate Branch and Gulshan Corporate Branch distributed loans and
advances fraudulently to some parties contravening banking rules and
regulations.
16. We also report that:
• (i) We have obtained all the information and explanations which to the best of our
knowledge and belief were necessary for the purpose of our audit and made due
verification thereof;
• (ii) in our opinion, proper books of account as required by law have been kept by SBL so
far as it appeared from our examination of those books and proper returns adequate for
the purpose of our audit have been received from (1140) branches not visited by us;
• (iii) the consolidated balance sheet and consolidated profit and loss account of the Group
and those of the Bank together with the annexed notes 1 to 48 dealt with by the report are
in agreement with the books of account and returns;
• (iv) the expenditures incurred was for the purpose of the Group’s and the Bank’s
business;
• (v) subject to matters described in basis for qualified opinion paragraphs and emphasis of
matter paragraph, the financial position as of 31 December 2012 and the loss for the year
then ended have been properly reflected in the financial statements and the financial
statements have been prepared in accordance with the Bangladesh Accounting Standards.
21. Adverse Report
When an auditor gives his opinion in a report describing
that the accuracy and the appropriate ness of the accounts
are not properly shown is called adverse report.
22. Disclaimer Report
Where there exits differences between the opinion of the auditor and
authority then the auditor reports that he is unable to take the
responsibility of audit, then it is called report with disclaimer.
23. Audit Report of Company
• According to section 213 (2), (3), & (4) the auditor’s report should contain
the following clause.
• 1st clause: Whether or not they have obtained all the information & explanations
which is the best of their knowledge & belief were necessary for the purpose of
the audit (sec 213).
2nd clause :Whether or not in their opinion proper books of accounts as recquired
by the act have been kept by the company sec 213(1).
3rd clause: Whether or not in their opinion the balancesheet & profit &loss account
have been drawn up in conformity with the act & are in agreement with the books
of account.
24. 4th clause: whether or not in their opinion and to the best of their information
and according to the explanation given to them, the said accounts give the
information a recquired by the ordinance in the manner so required and give a
true and fair view.
5th clause: whether or not in their opinion:-
1. The expenditure incurred during the year was for the purpose of a company business.
2. The business conducted, investments made & expenditure incurred during the year were in
accordance with the objects of company.
25. When to qualify an audit report:
In adequate provision for depreciation
In adequate provision made for bad and doubtful debts.
Valuation of investment at cost when the market price is far below it.
Contingent liability is not disclosed
Violation of provisions of company law- payment of remuneration to
managerial personnel in excess of limit without approval.
26. Features of qualified audit report
Clear & unambiguous
Conciseness.
Specific & to the point
Effect of matter
Misinterpretation.
