Contents:
1. Information Systems Concepts
General Systems Concepts – Nature and types of systems, nature and types of
information, attributes of information.
Management Information System – Role of information within business
Business informationPaper 3: Advanced Auditing and Professional Ethics
(One Paper- Three hours - 100 marks)
Level of Knowledge: Advanced knowledge
Objectives:
(a) To gain expert knowledge of current auditing practices and procedures and apply them
in auditing engagements,
(b) To develop ability to solve cases relating to audit engagements.
Contents:
1. Auditing Standards, Statements and Guidance Notes
Auditing and Assurance Standards (AASs); Statements and Guidance Notes on Auditing
issued by the ICAI; Significant differences between Auditing and Assurance Standards and
International Standards on Auditing.
2. Audit strategy, planning and programming
Planning the flow of audit work; audit strategy, planning programme and importance of
supervision: review of audit notes and working papers; drafting of reports; principal’s
ultimate responsibility; extent of delegation; control over quality of audit work; reliance on
the work of other auditor, internal auditor or an expert.
3. Risk Assessment and Internal Control
Evaluation of internal control procedures; techniques including questionnaire, flowchart;
internal audit and external audit, coordination between the two.
4. Audit under computerized information system (CIS) environment
Special aspects of CIS Audit Environment, need for review of internal control especially
procedure controls and facility controls. Approach to audit in CIS Environment, use of
computers for internal and management audit purposes: audit tools, test packs,
computerized audit programmes; Special Aspects in Audit of E-Commerce Transaction.
5. Special audit techniques
(a) Selective verification; statistical sampling: Special audit procedures; physical
verification of assets, direct confirmation of debtors and creditors
(b) Analytical review procedures
(c) Risk-based auditing.
6. Audit of limited companies
Statutory requirements under the Companies Act 1956; Audit of branches: joint audits;
Dividends and divisible profits % financial, legal, and policy considerations.
7. Rights, duties, and liabilities of auditors; third party liability.
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8. Audit reports; qualifications, notes on accounts, distinction between notes and
qualifications,
detailed observations by the statutory auditor to the management vis-a-vis obligations of
reporting to the members.
9. Audit Committee and Corporate Governance
10. Audit of Consolidated Financial Statements, Audit Reports and Certificates for Special
Purpose engagements; Certificates under the Payment of Bonus Act, import/export control
authorities, etc.; Specific services to non-audit clients; Certificate on Corporate
Governance.
11. Special features of audit of banks, insurance companies, co-operative societies and
non-banking financial companies.
12. Audit under Fiscal Laws, viz, Direct and Indirect Tax Laws.
13. Cost audit
14. Special audit assignments like audit of bank borrowers, audit of stock and commodity
exchange intermediaries and depositories; inspection of special entities like banks,
financial institutions, mutual funds, stock brokers.
15. Special features in audit of public sector companies. Directions of Comptroller and
Auditor General of India under Section 619; Concepts of propriety and efficiency audit.
16. Internal audit, management and operational audit Nature and purpose,
organisation, audit programme, behavioural problems; Internal Audit Standards issued by
the ICAI; Specific areas of management and operational audit involving review of internal
control, purchasing operations, manufacturing operations, selling and distribution,
personnel policies, systems and procedures. Aspects relating to concurrent audit.
17. Investigation and Due Diligence.
18. Concept of peer review
19. Salient features of Sarbanes – Oxley Act, 2002 with special reference to reporting on
internal control.
20. Professional Ethics
Code of Ethics with special reference to the relevant provisions of The Chartered
Accountants Act, 1949 and the Regulations thereunder.
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Paper 4: Corporate and Allied Laws
(One paper – Three hours – 100 marks)
Section A: Company Law (70 Marks)
Level of Knowledge: Advanced knowledge
Objective:
To be able to analyze and apply various provisions of the Companies Act in practical
situations
Contents:
1. The Companies Act, 1956, Rules and Regulations thereunder in its entirety with
specific reference to
(a) Accounts and audit
(b) Dividend
(c) Directors - powers, managerial remuneration
(d) Meetings, powers of the Board and related party transactions
(e) Inspection and Investigation
(f) Compromises, Arrangements and Reconstructions
(g) Prevention of Oppression and Mismanagement
(h) Revival and Rehabilitation of Sick Industrial Companies
(i) Corporate Winding up and Dissolution
(j) Producer Companies
(k) Companies incorporated outside India
(l) Offences and Penalties
(m) E-governance
2. Corporate Secretarial Practice – Drafting of Resolution, Minutes, Notices and Reports
Section B: Allied Laws (30 Marks)
Objective:
To develop ability to analyse the requirements of laws stated in the Section.
Contents:
3. An overview of the following laws –
(a) The Securities and Exchange Board of India Act,1992, Rules, Regulations and
Guidelines issued thereunder.
(b) The Securities Contracts (Regulation) Act, 1956
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(c) The Foreign Exchange Management Act, 1999
(d) The Competition Act, 2002
(e) The Banking Regulation Act, 1949, The Insurance Act, 1938. The Insurance
Regulatory and Development Authority Act, 1999. The Securitisation and Reconstruction of
Financial Assets and Enforcement of Security Interest Act, 2002
(f) The Prevention of Money Laundering Act, 2002
4. Interpretation of Statutes, Deeds and Documents.