PROGRAM - MBA - SEMESTER - 3

SUBJECT CODE & NAME - MF0013 & INTERNAL

AUDIT AND CONTROL
1. Distinguish between Government audit and
Specific audit. Explain types of Government And
Specific Audit?
Distinguish between Government audit and Specific audit
GOVERNMENT AUDIT
It covers all areas of management
and is company-focussed.

SPECIFIC AUDIT
Covers one or more specific areas of
management

Examples are : Audit of government

departments , Audit of Government
Companies etc.
It is usually done on a routine,
predetermined schedule.

Examples of specific audit are cost audit

and tax audit.
Specific audits are need-based and
may occur at any time, except for
statutory audits of a specific nature, like
cost audits, secretarial audits and
tax audits.

Types Government audit

Government audit is yet another variety of general audit and can be studied under
three heads:
1. Audit of government departments: Audit of government departments and
undertakings not registered under Companies Act, 1956 are governed by Article
149 of the Constitution.

READY MADE SOLVED ASSIGNMENTS, PROJECT

REPORTS, MODEL QUESTION PAPERS, GUIDE,
SYNOPSIS ETC. OF SIKKIM MANIPAL UNIVERISTY
Call : - +91 9540358147, Whatsapp: +91 8285115522

Website: - www.smudoc.in, Email ID :

smudoc@gmail.com

2. Write the similarity and dissimilarity of Internal

and External Audit? Explain the Co-operation
between external and internal auditor.
Similarity and Dissimilarity of Internal and External Audit
1. Points of similarity
In both internal and external audit, the focus areas are:
1. Evaluation of the internal control systems of the entity.
2. Correctness of accounting documentation, bookkeeping
reporting.
3. Verification of assets.

and

financial

There is a similarity in the approach and methods also. Sampling, test

checking, application of statistical tools and administering questionnaires are
tools adopted in both systems.

READY MADE SOLVED ASSIGNMENTS, PROJECT

REPORTS, MODEL QUESTION PAPERS, GUIDE,
SYNOPSIS ETC. OF SIKKIM MANIPAL UNIVERISTY
Call : - +91 9540358147, Whatsapp: +91 8285115522
Website: - www.smudoc.in, Email ID :
smudoc@gmail.com

3. The audit firm follows certain policies and

procedures. Explain the quality control policies
adopted by an audit firm.
Audit firm
1. The audit firm should ensure that all audits comply with auditing
standards, and accordingly the firm has to design and implement quality control
policies and procedures.
2. The quality control policies to be adopted by an audit firm will usually
include the following:
(a) Professional requirements: The firms personnel have to follow the principles of
independence, objectivity, confidentiality, integrity and professional behaviour.
(b) Skills and competence: The firm is staffed only with personnel who possess and
are able to maintain the technical standards and professional competence
required to enable them to fulfil their responsibilities with due care.

READY MADE SOLVED ASSIGNMENTS, PROJECT

REPORTS, MODEL QUESTION PAPERS, GUIDE,
SYNOPSIS ETC. OF SIKKIM MANIPAL UNIVERISTY
Call : - +91 9540358147, Whatsapp: +91 8285115522
Website: - www.smudoc.in, Email ID :
smudoc@gmail.com

4. List and explain the elements of Internal

Control. Explain the basic principles of governing
internal control
Elements of Internal Control

1. Control environment: Control environment is the basis of an internal control

system. It includes and reflects the factors that influence the control

consciousness of its people. SA400: Risk Assessment and Internal Control

issued by the ICAI mentions the following aspects of the control environment:
Factors
a. Organisation structure

Examples
a. Segregation of incompatible
functions helps in fixing accountability

b. Board of Directors and their

committees

b. A board which is independent of

management or an effective audit
committee indicates strong internal
control environment

READY MADE SOLVED ASSIGNMENTS, PROJECT

REPORTS, MODEL QUESTION PAPERS, GUIDE,
SYNOPSIS ETC. OF SIKKIM MANIPAL UNIVERISTY
Call : - +91 9540358147, Whatsapp: +91 8285115522
Website: - www.smudoc.in, Email ID :
smudoc@gmail.com

5.
List and Explain the
specific problems of
Electronic Data Processing (EDP) relating to
internal control.
Specific Problems of Electronic Data Processing (EDP) relating to Internal
Control
The implementation of internal control in an EDP system, give rise to the following
problems:
(a) Separation of duties
(b) Delegation of authority and responsibility
(c) Competent and trustworthy personnel
(d) System of authorisations
(e) Adequate documents and records
(f) Physical control over assets and records

(g) Adequate management supervision

(h) Comparing recorded accountability with assets

READY MADE SOLVED ASSIGNMENTS, PROJECT

REPORTS, MODEL QUESTION PAPERS, GUIDE,
SYNOPSIS ETC. OF SIKKIM MANIPAL UNIVERISTY
Call : - +91 9540358147, Whatsapp: +91 8285115522
Website: - www.smudoc.in, Email ID :
smudoc@gmail.com

6.
Explain the factors for having the effective
internal control system for a bank.
An effective internal control system for a bank should consider the
following aspects:
1. Control environment: Control environment is the foundation of an
internal control system. It includes and reflects the factors that influence the
control consciousness of its people. As per Auditing and Assurance Standard 6
issued by ICAI (AAS6), control environment is the overall attitude, awareness
and actions of directors and management about the internal control system and its
importance in the entity.
2. Risk recognition and assessment: To be effective, an internal control system
should recognise and continually assess all material risks internal and
external, controllable and

READY MADE SOLVED ASSIGNMENTS, PROJECT

REPORTS, MODEL QUESTION PAPERS, GUIDE,
SYNOPSIS ETC. OF SIKKIM MANIPAL UNIVERISTY

Call : - +91 9540358147, Whatsapp: +91 8285115522

Website: - www.smudoc.in, Email ID :
smudoc@gmail.com