A company audit is generally a statutory audit conducted under company law. The company auditor is appointed to give an independent opinion on the financial statements and to protect stakeholders like shareholders, creditors and regulators.
In exam answers, structure as:
Typical points to mention (overview level):
Exam tip: write “appointed by shareholders” and “statutory requirement” if you are not writing section numbers.
Keep answers general unless your syllabus requires exact legal sections.
Common rights:
These rights help auditor perform duties effectively.
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Appointment of company auditor is generally a statutory requirement. The auditor is appointed by the company through prescribed procedure (commonly by shareholders in general meeting), and must be eligible and independent.
Auditor holds office for the prescribed term and can be re-appointed as per applicable rules.
(Exact section numbers are written only if required by syllabus.)
Rights of company auditor (any five):
These rights enable proper evidence collection and reporting.
Financial auditing is the process of examining an organization's (or individual's) financial records to determine if they are accurate and in accordance with any applicable rules (including accepted accounting standards), regulations, and laws.
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A company audit is generally a statutory audit conducted under company law. The company auditor is appointed to give an independent opinion on the financial statements and to protect stakeholders like shareholders, creditors and regulators.
In exam answers, structure as:
Typical points to mention (overview level):
Exam tip: write “appointed by shareholders” and “statutory requirement” if you are not writing section numbers.
Keep answers general unless your syllabus requires exact legal sections.
Common rights:
These rights help auditor perform duties effectively.
Key duties:
Auditor must exercise due care and professional skepticism.
A basic auditor’s report includes:
It is important because it communicates auditor’s opinion to users.
Liabilities can be:
Auditor can reduce liability by:
Auditor responsibilities flow:
Appointment → Plan audit → Collect evidence → Evaluate → Report opinion → Maintain documentation
Liability comparison:
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A company auditor is an independent auditor appointed under law to audit a company and give an opinion on whether financial statements show a true and fair view.
Rights → enable auditor to collect evidence → form opinion → report
These rights ensure the auditor can perform duties effectively.