What do you mean by statutory audit?

A statutory audit is a legally required review of the accuracy of a company’s or government’s financial statements and records. Firms that are subject to audits include public companies, banks, brokerage and investment firms, and insurance companies.

Is statutory audit internal or external?

Statutory audit is an audit by a practising Chartered Accountant which has its operations exterior to the organization which it is auditing. Statutory Auditors are a part of the external audit process.

Can a statutory auditor be an internal auditor explain?

3.4. 15 A statutory auditor of a company cannot also be its internal auditor, as it will not be possible for him to give independent and objective report issued under sub-Section 4A of Section 227 of the Companies Act, 1956 read with the Companies (Auditors’ Report) Order, 2003.

Is statutory audit a type of audit?

A statutory audit is a mandatory audit of a company’s financial records by an external entity. This audit is mandated by statute or law that governs an organization’s principles and ethics.

Which is an example of statutory audit?

E.g., like misappropriation of funds by ensuring continuous examination of data, which may be in the scope of other types of audits. A statutory auditor can ask for the company’s financial books, records, or information concerning that. It is his right, and the management cannot deny him for the same.

What is internal auditing?

What is an Internal Audit? Internal audits evaluate a company’s internal controls, including its corporate governance and accounting processes. These audits ensure compliance with laws and regulations and help to maintain accurate and timely financial reporting and data collection.

What is statutory audit in India?

Statutory Audit is an audit which is prescribed by the different statute like Reserve Bank of India, Income Tax, Companies Act, etc. A Chartered Accountant need to conduct many audits as per the different statute requirement. Statutory Auditors are appointed by RBI in association with the ICAI.

Is statutory audit and external audit same?

Generally statutory audit is the audit conducted by a Chartered Accountant required by the Ministry of Corporate Affairs’. An external audit is an audit authrised by any other govt law of statute and not voluntary by any business house.

Is statutory audit and independent audit same?

same. statutory audit is comulsory audit OR audit by law is called statutory audit. it is also called internal audit.

What is a statutory audit in India?

What is the difference between statutory audit and internernal audit?

Statutory audit is required by the statute i.e by the Companies Act. This is a mandatory requirement and can be conducted only by the practising Chartered accountants. While Internernal Auditor is appointed by the management to check the internal control and is optional.

What is the difference between internal audit and external audit?

So, Remuneration of the internal auditor is fixed by the management while for the statutory auditor the remuneration is fixed by the shareholders. Internal Audit is a continuous process while the External Audit is conducted on a yearly basis.

Is internal audit compulsory for a company?

Internal Audit is not compulsory. In case of a specified company whose paid up capital and reserves exceed Rs.50 lakh or whose average annual turnover in the three financial years preceding the present financial year exceeds Rs. 5 crore, internal audit it compulsory. The internal auditor is often an employee of the enterprise.

What is the status and scope of an internal auditor?

Status: An internal auditor is a staff. The scope of work: It is related to the examination of books of accounts and other activities of an organization. Removal: Internal auditor can be removed by management. Remuneration: Internal auditor is fixed by the management.