AN INTERNSHIP PROJECT REPORT

ON
AUDITING AND ITS IMPORTANCE

SUBMITTED TO
SAVITRIBAI PHULE PUNE UNIVERSITY

IN PARTIAL FULFILLMENT OF THE REQUIREMENT

OF THE PROGRAMME
BACHELOR OF BUSINESS ADMINISTRATION

SUBMITTED BY
SUDITI CHANNEY

UNDER THE GUIDANCE OF

MS. ANJALI GHOEL

DEPARTMENT OF MANAGEMENT
CHRIST COLLEGE - PUNE
2022-23
 CHRIST COLLEGE - PUNE

CERTIFICATE

This is to certify that Ms. Suditi Channey of Semester VI TYBBA Roll no. 55
having specialization in Finance has successfully completed her project titled
Auditing and its Importance as per the norms of Savitribai Phule Pune
University for the academic year 2022-23.

Project Guide
Ms. Anjali B Gohel External Examiner

HOD- Management Principal

Mrs. Deepa Sujith Dr (Fr) Arun Anthony Chully CMI
 ACKNOWLEDGEMENT

I would like to express my gratitude to my Project guide, Name of the guide,

for guiding me throughout the report presentation and inspiring me to complete
the project by focusing on the minute requirements. I am extending my sincere
thanks to the Principal of Christ College Pune, Dr (Fr) Arun Anthony Chully
CMI, for providing me with a conducive environment and an opportunity for
holistic development. I take this opportunity to express my profound gratitude
to Mrs. Deepa Sujith, Head of the Department (Management) for her
motivation and perennial support and encouragement. I also extend my sincere
thanks to all the faculty members who have given their valuable inputs during
the course. Last but not least, I take this opportunity to thank my family and
friends for their assistance and encouragement in completing this project.

Suditi Channey
 INDEX

Sr No. Topic Page No.

1 Abstract 1
2 Executive Summary 2
3 Introduction 3
4 Aims and Objectives 7
5 Company Profile 8
6 Role in Internship 14
7 Learning Outcomes 19
8 Survey and Analysis – Introduction 21
9 Relevance of the Study 24
10 Methodology 25
11 Questionnaire 26
12 Results 27
13 Interpretation 34
14 Suggestions 36
15 Conclusion 37
16 References 38
 Abstract

The following report is on the learning of 68 hours of internship programme which had to be
completed as prescribed by the Savitribai Phule Pune University. All students perusing the
bachelors of business administration must gain a work experience in their specialised field for
minimum 60 hours in their last semester. Pertaining to this, I have completed my internship in
the field of finance for above 60 hours.

This report includes the details and information on the work done and the company in which
the work was carried out. The specialized field of work was Auditing, which included
presentation of data, Financial statement analysis, Research and many other areas which were
explored and used during the internship. This report also includes data which was collected as
well as information which was taken from the Internet so as to provide a basis for the work that
was performed.

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 Executive Summary

This report is pertaining to the completion of above 60 hours of internship in the carted
accountancy firm M R Hundiwala. The company is a chartered accountants firm that offers
consultancy services to companies regarding tax payments, tax returns, auditing etc. My role
in the organisation was to provide researched material to the auditing team regarding various
areas as per their requirements. This included a well-researched report on the annual budget,
industry analysis of the automobile sector as well as some supporting industries. The internship
lasted for 68 hours, that is about 4 hours per day.

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 Introduction

Auditing is the examination or inspection of various books of accounts by an auditor followed

by physical checking of inventory to make sure that all departments are following documented
system of recording transactions. It is done to ascertain the accuracy of financial statements
provided by the organisation.

Auditing typically refers to financial statement audits or an objective examination and

evaluation of a company’s financial statements – usually performed by an external third party.

Audit can be done internally by employees or heads of a particular department and externally
by an outside firm or an independent auditor. The idea is to check and verify the accounts by
an independent authority to ensure that all books of accounts are done in a fair manner and
there is no misrepresentation or fraud that is being conducted. All the public listed firms have
to get their accounts audited by an independent auditor before they declare their results for any
quarter.

In India, chartered accountants from ICAI or The Institute of Chartered Accountants of India
can do independent audits of any organisation. CPA or Certified Public Accountant conducts
audits in USA. There are four main steps in the auditing process.

The first one is to define the auditor’s role and the terms of engagement which is usually in the
form of a letter which is duly signed by the client. The second step is to plan the audit which
would include details of deadlines and the departments the auditor would cover. The audit
could last a day or even a week depending upon the nature of the audit. The next important step
is compiling the information from the audit. When an auditor audits the accounts or inspects
key financial statements of a company, the findings are usually put out in a report or compiled
in a systematic manner. The last and most important element of an audit is reporting the result.
The results are documented in the auditor’s report.

Audit is an important term used in accounting that describes the examination and verification
of a company’s financial records. It is to ensure that financial information is represented fairly
and accurately.

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Also, audits are performed to ensure that financial statements are prepared in accordance with
the relevant accounting standards. The three primary financial statements are:

1. Income statement
2. Balance sheet
3. Cash flow statement

Financial statements are prepared internally by management utilizing relevant accounting

standards, such as International Financial Reporting Standards (IFRS) or Generally Accepted
Accounting Principles (GAAP). They are developed to provide useful information to the
following users:

 Shareholders
 Creditors
 Government entities
 Customers
 Suppliers
 Partners

Financial statements capture the operating, investing, and financing activities of a company
through various recorded transactions. Because the financial statements are developed
internally, there is a high risk of fraudulent behaviour by the preparers of the statements.

Without proper regulations and standards, preparers can easily misrepresent their financial
positioning to make the company appear more profitable or successful than they actually are.
Auditing is crucial to ensure that companies represent their financial positioning fairly and
accurately and in accordance with accounting standards.

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There are three main types of audits:

1. Internal audits

Internal audits are performed by the employees of a company or organization. These audits are
not distributed outside the company. Instead, they are prepared for the use of management and
other internal stakeholders.

Internal audits are used to improve decision-making within a company by providing managers
with actionable items to improve internal controls. They also ensure compliance with laws and
regulations and maintain timely, fair, and accurate financial reporting. Management teams can
also utilize internal audits to identify flaws or inefficiencies within the company before
allowing external auditors to review the financial statements.

2. External audits

Performed by external organizations and third parties, external audits provide an unbiased
opinion that internal auditors might not be able to give. External financial audits are utilized to
determine any material misstatements or errors in a company’s financial statements.

When an auditor provides an unqualified opinion or clean opinion, it reflects that the auditor
provides confidence that the financial statements are represented with accuracy and
completeness. External audits are important for allowing various stakeholders to confidently
make decisions surrounding the company being audited.

The key difference between an external auditor and an internal auditor is that an external
auditor is independent. It means that they are able to provide a more unbiased opinion rather
than an internal auditor, whose independence may be compromised due to the employer-
employee relationship.

There are many well-established accounting firms that typically complete external audits for
various corporations. The most well-known are the Big Fthe – Deloitte, KPMG, Ernst & Young
(EY), and PricewaterhouseCoopers (PwC).

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3. Government audits

Government audits are performed to ensure that financial statements have been prepared
accurately to not misrepresent the amount of taxable income of a company. Within the U.S.,
the Internal Revenue Services (IRS) performs audits that verify the accuracy of a taxpayer’s
tax returns and transactions. The IRS’s Canadian counterpart is known as the Canada Revenue
Agency (CRA).

Audit selections are made to ensure that companies are not misrepresenting their taxable
income. Misstating taxable income, whether intentional or not, is considered tax fraud. The
IRS and CRA now use statistical formulas and machine learning to find taxpayers at high risk
of committing tax fraud.

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 Aims and Objectives

 To understand the relevance of research in the field of auditing. Research is the pursuit
of new knowledge. The relevancy in research means that study which you are
performing should be useful for others as well- and high relevancies mean research
which you are performing has great potential to fill a gap in knowledge, especially if
it’s something people currently don’t know about or understand very well
 To better analyse financial statements and financial records. Financial accounting calls
for all companies to create a balance sheet, income statement, and cash flow statement,
which form the basis for financial statement analysis.
 To present the data collected in a manner that helps decision makers in easily grasping
the information.
 To understand the valuation and financial position of a company by recording and
analysing data collected.

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 Company Profile

M R Hundiwala & Co. is a long standing and growing Indian Chartered Accountants’ firm
based in Aurangabad (Maharashtra, India) and having its office at Pune (Maharashtra, India).

The Prime objective of the firm is providing broad array of high quality services to its clients
in the most competent and professional manner. The firm carries an experience of more than
35 years in providing multifaceted services in the core areas of Audit and Assurance, Direct
Tax, International Taxation, Risk Assessment and Consulting, IFRS Consulting, Process
Strategy to Indian and Foreign Corporations.

30 personnel spread across two offices pursue the highest level of ethics, independence,
integrity, and professionalism. These Core values are put into practice at the firm by expert,
experienced and motivated professionals.

M R Hundiwala offer a series of services to cater to the diverse needs of the clients. The in
house team of experts works in tandem with the global network of associates to seamlessly
provide services, irrespective of wherever the clients are located. We provide services mainly
in the following domains:

Audit and Assurance

All the audits begin with a full assessment and understanding of the client's business and
operations.
This allows them to provide constructive suggestions for improving business strategies,
management information and controls. The examinations are based on statutory requirements
and local auditing practices and the procedures comply with the Standards on Auditing. An
independent Quality Assurance review of the Internal Audit function provides an effective
means of assessing the performance, against the management's expectations and best practices,
which facilities the transition to world-class standards.

The approach to Statutory Audit of the financial statements is to provide reasonable assurance

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that the accounts have been prepared in accordance with the Generally Accepted Accounting
Principles (GAAP) and are free of any misstatements, errors and discrepancies. In addition to
the traditional statutory audit, we also help the clients by monitoring organizational ethics,
conducting effective reviews of operational and financial performance, assessing the quality,
economy and efficiency of their operations and suggesting continuous improvement strategies.

 Sound advice on operations, performance and internal controls

 An assessment of whether the procedures adopted comply with the established policies
and procedures
 An assessment of whether best practices are being consistently implemented throughout
the organization

The Firm provides following Assurance Services

 Statutory audit under Companies Act

 Reporting on Internal Financial Control Over Financial Reporting
 Tax Audits
 Internal audit
 Management and operational audit
 Certifications
 Systems and Controls benchmark audit
 Preparation and Testing of Internal financial control over financial reporting

Direct tax advisory

Compliance: Filing of corporate and non-corporate tax returns, deposit and filing of
withholding tax returns, obtaining certificates for lower deduction for resident and non-
residents taxpayers and appearance before the authorities in cases of assessment, withholding
tax and other proceedings. Domestic Advisory: Advice on Search and Seizure operations, Tax
planning strategies, payroll structuring and opinions on various issues under the tax laws.

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Tax Audits : Audit under section 44AB of Income Tax Act, 1961

International Tax

Scope of International Taxation services include:

 Interpretation and utilization of Double Taxation Avoidance Agreements.

 Ensuring compliance of International withholding tax matters.
 Contract review.
 Tax efficient Holding Company locations.
 Inbound and outbound structuring.
 Profit Repatriation.

Advisory and Consultancy

These future-oriented services aim to bring specialized diagnostic skills to handling a variety
of special projects ranging from specific problem solving to long term strategic planning to
business process designing to setting up of a control framework. The collaborative approach
adopted in these consultancy projects makes for easy implementation of the proposed
organizational and process models. Timely strategic financial advice is the need in today's
rapidly evolving competitive landscape. They understand this and assist in identifying
opportunities for, or risks to, the clients' interests, which accompany most Financial advisory
(FA) engagements. For those adopting IFRS and or Ind AS for the first time, we help with
training staff as well as the project management team to ensure as smooth an implementation
as possible.

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Transfer Pricing

Scope of Transfer pricing services include:

Transfer pricing is one of the most challenging tax issues and a key influence on a company’s
worldwide tax burden. It impacts every aspect of supply chain–R&D, procurement,
manufacturing, marketing, distribution and customer support.

As more and more economies imbibe the concept of Transfer Pricing regulations, new rules,
documentation standards and penalties are being legislated to enforce and administer the
regulations. This impacts tax planning, compliance and reporting obligations of multinationals.
Moreover, the way Transfer Price is imbibed in a transaction can be critical in determining the
success of a business venture.

Periodic Review

 Review documentation maintained from assessment perspective.

 Assistance in building up the documentation to justify transfer prices.

Accountants Report

 Issue of certificate under Income Tax Act in respect of Transactions with Associated
Enterprises.

Transfer Pricing Study

 Studies involving functional, assets and risk analysis and dovetailing the results with
other legislations.
 Performing Best Method analysis.
 Comparability Analysis.

Litigation Support

 Developing a positioning strategy

 Representation during assessments

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Accounting and business support

Scope of Business Start Up Support includes:

It is difficult to make sound business decisions in today's global economy without having
timely, reliable and meaningful financial data. The Firm can boost business success by making
accounting systems work harder for management on a daily basis. The Firm provides services
that are meant to fulfil the extensive and wide-ranging need for accountancy specialists, with
up to date and sound fundamental knowledge of the subject. Apart from a superior technical
understanding of all facets of accountancy, the vast experience of the firm in handling
secretarial, taxation and consultancy engagements for various industry groups is an added
advantage.

Regulatory compliances

Other than taxation there are various services offered by the firm to ensure all kinds of
regulatory compliances are compiled by the business entities, they are as follows:

compliance services are offered by the firm:

 Real Estate Regulatory Act compliances

 Foreign Exchange Management Act compliances
 SEBI compliances
 RBI compliances

Indirect Tax Advisory

 The services offering for GST include following:

 Providing the client with a road map to effective implementation of GST
 Analysing the impact of GST implementation on business and structuring a target
operating model which minimises tax cost and maximise benefits

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 Development of accounting and procedural manuals keeping in mind the GST
framework and clients’ work ethos
 Training the client’s personnel on the various aspects of the tax regime and equipping
them with the skill sets to comply with GST law
 Implementation of procedures and practices required for effective compliance with
Goods and service tax requirements
 Litigation support in front of various regulatory authorities

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 Role in Internship

During the 68 hours of the internship, the work assigned was to carry out research and analysis
of financial data relevant to the audits being carried out by the organization for their clients.

Budget analysis

The first task was to analyse the recently released budget for any new updates and changes in
the new tax regime. The budget for the financial year was released on the first of February
2023. The analysis was done to primarily study the new tax regime that will be followed from
this financial year.

The new tax regime states that there will no tax on income up to 7.5 lakh a year in the new
regime. Income of Rs 15 lakh will fetch Rs 1.5 lakh tax, down from Rs 1.87 lakh. A Rs 50,000
standard deduction to taxpayers has been introduced under the new regime. Tax exemption
removed in insurance policies with premium over Rs 5 lakh. Tax exemption on leave
encashment on retirement of non-government salaried employees hiked to Rs 25 lakh from Rs
3 lakh. TDS rate to be reduced from 30 per cent to 20 per cent on taxable portion of EPF
withdrawal in non-PAN cases.

This study also included an analysis on how the new tax regime would impact the corporate
sector as well as how the new rebate system will impact the tax payers. The other important
sector that this analysis focused on how there was a change in the prices of commodities and
the impact it had on the common consumers of the nation.

The presentation of the research also shed light on the changes in the MSME sector made by
the finance minister. Credit Guarantee Scheme for MSMEs will be extended with an infusion
of Rs 9,000 crore. Enable collateral for Rs 2 lakh crore loans to MSMEs This is expected to
boost fund flow to the distressed and fund-starved MSME sector. Micro enterprises with
turnover up to ₹2 crore and certain professionals with turnover of up to ₹50 lakh can avail the
benefit of presumptive taxation. I propose to provide enhanced limits of ₹3 crores and ₹75
lakhs respectively, to the taxpayers whose cash receipts are no more than 5%."

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The remainder of the research focused on the other key highlights of the budget of 2023 –
2024 that may be essential to the auditors or the clients of the company.

Industry analysis

The next essential task was to carry out an industry analysis of the automobile sector. The
primary motive was to study the financial data of the prominent companies within that industry
and analyse the collected data to see how each company is performing in various areas as
compared to the industry standard and other competing companies.

The overall industry was also analysed for its risks and opportunities and its impact on the
economy as well the society and the environment in general. The study also sheds light on how
changes in the business environment can have an impact in the performance of the industry as
a whole.

Cash transfers for the poor, rate cuts by the RBI to inject liquidity into the system and the
government’s spending on infrastructure and the rural sector are expected to aid the economy.
Consumers will conserve cash, in view of unforeseen events like potential job loss and salary
cuts levels. This will lead to delay in purchase of all non-essential durables, and may pose a
risk to many industries in the manufacturing sector including automobiles. This may result in
delayed recovery of the 2W industry.

The companies whose financial data had been studied and compared are:

 Eicher
 Maruti Suzuki
 TVS motors
 Tata Motors
 Mahindra and Mahindra
 Ashok Leyland
 Bajaj
 Hero

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A study on PoEM – Place of Effective Management in India

This study was carried out on the basis of the information provided by Deloitte Haskins &
sells LLP. This study included the understanding of the residential status of the company
as well as the control and management aspects according to the Indian judicial rulings.
The research also includes the understanding of the concept of place of effective
management and its key terminologies.

Meanings
Key Terms

Effective Producing the results that is wanted or intended; in reality, although not
officially intended

Management The act of managing by direction, or regulation or administration or control

or supervisions

Key In definition of PoEM may be read as important, main crucial, significant,

vital, strategic decision

Commercial In context of PoEM refer to key commercial decisions may refer to strategic
commercial decisions concerning the business of the company

As a whole All parts or aspects considered; altogether

In Substance In substance’ indicates that in making the necessary comparison, form

should be disregarded

The overall research was a deep dive into the intricacies of PoEM and its application,
implications, implementations and areas of improvement.

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Competition Analysis

The next area for carrying out research was the competition analysis of the Electric Vehicles
and the competing companies that manufacture electric vehicles. The sales volumes were
compared for these companies, both export as well as import sales. The companies compared
are as follows:

 Ola electric
 Hero electric
 Ampere vehicles
 Ather energy
 Mahindra Electric
 Euler Motors
 Atul Auto
 Kinetic Green
 Tata
 MG
 Hero Electric
 TVS
 Okinawa

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State Budget

One of the studies also included the analysis of the state budget. It helped study the difference
between the actual expenditure and the estimated expenditure.

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 Learning Outcomes

The following are the learning outcomes from the internship:

 Budget analysis - A budget analysis is a strategy for evaluating a business' financial

well-being. By scrutinizing the budget, you can monitor how much money the business
is bringing in and compare that amount to how much money it's spending in a period
of time. Performing a budget analysis can help business leaders make important
decisions about the company's expenses and revenue streams. Many businesses perform
budget analyses on a monthly basis, but you can analyse a company's budget quarterly,
annually or on another schedule of your own choice.

 Industry analysis - Understanding how industries and companies operate, together with
an analysis of financial statements, provides a basis for forecasting company
performance and allows analysts to determine the value of an investment in a company
or its securities. Industry analysis is the analysis of a specific branch of manufacturing,
service, or trade. Understanding the industry in which a company operates provides an
essential framework for the analysis of the individual company—that is, company
analysis. Equity analysis and credit analysis are often conducted by analysts who
concentrate on one or several industries, which results in synergies and efficiencies in
gathering and interpreting information.

 Competition analysis - A competitive analysis is a strategy that involves researching

major competitors to gain insight into their products, sales, and marketing tactics.
Implementing stronger business strategies, warding off competitors, and capturing
market share are just a few benefits of conducting a competitive market analysis. A
competitive analysis can help you learn the ins and outs of how your competition works,
and identify potential opportunities where you can out-perform them. It also enables

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 you to stay atop of industry trends and ensure your product is consistently meeting —
and exceeding — industry standards.

 Analysis of State Budget - With an objective to incorporate the expenditure made by

Government in State Income Estimates, the budget of the State Government is being
analysed, every year in the light of the guidelines given by the Central Statistics Office,
MOSPI and the expenditure, Product taxes, product subsidies etc., as per Budget
Estimates, Revised Budget Estimates, final expenditure shown in the Accounts will be
incorporated in appropriate sectors of the State Income Estimates.

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 Survey and Analysis

Introduction

Audit is an important term used in accounting that describes the examination and verification
of a company’s financial records. It is to ensure that financial information is represented fairly
and accurately.

Also, audits are performed to ensure that financial statements are prepared in accordance with
the relevant accounting standards. The three primary financial statements are:

 Income statement
 Balance sheet
 Cash flow statement

Financial statements are prepared internally by management utilizing relevant accounting

standards, such as International Financial Reporting Standards (IFRS) or Generally Accepted
Accounting Principles (GAAP). They are developed to provide useful information to the
following users:

 Shareholders
 Creditors
 Government entities
 Customers
 Suppliers
 Partners

Financial statements capture the operating, investing, and financing activities of a company
through various recorded transactions. Because the financial statements are developed
internally, there is a high risk of fraudulent behaviour by the preparers of the statements.

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Without proper regulations and standards, preparers can easily misrepresent their financial
positioning to make the company appear more profitable or successful than they actually are.
Auditing is crucial to ensure that companies represent their financial positioning fairly and
accurately and in accordance with accounting standards.

A survey was conducted among the clients of MR Hundiwala and they were questioned about
their particular company’s auditing practices. The survey was conducted to understand how
auditing can have an impact in the functioning of an organisation and its efficiency,
productivity and accuracy.

Scope of the study

This study is useful for determining the importance of well researched audits in an organisation
for proper management and working of an organisation. During the internship we learnt about
the use of various tools to help present data and information in a way that would be easy for
decision makers to grasp and understand and make the process a whole lot easier. It also helped
analyse industries and the performance of various companies within that industry.

Legal Requirements - The auditor can determine the scope of an audit of financial statements
following the requirements of legislation, regulations, or relevant professional bodies. The state
can frame rules for determining the scope of audit work. In the same way, professional bodies
can make rules to conduct the audit.

Entity Aspects - The audit should be organized to cover all aspects of the entity as far as they
are relevant to the financial statements being audited. A business entity has many areas of work.
A small entity may have few functions, while a large concern has many. The auditor has to go
through all the functions of the business. The audit report should cover all functions, so the
reader may know about all the workings of a concern.

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Reliable Information - The auditor should obtain reasonable assurance as to whether the
information contained in the underlying accounting records and other source data is reliable
and sufficient as the basis for preparing the financial statements. The auditor can use various
techniques to test the validity of data. All auditors usually apply compliance and substance tests
while doing the audit work. The auditor can show such information in the report.

Proper Communication - The auditor should decide whether the relevant information is
properly communicated in the financial statements. Accounting is an information system, so
facts and figures must be presented so that the reader can get information about the business
entity. The auditor can mention this fact in his report. The accounting principles can be applied
to decide the disclosure of financial information in the statements.

Evaluation - The auditor assesses the reliability and sufficiency of the information in the
underlying accounting records and other source data by studying and evaluating accounting
systems and internal controls to determine the nature, extent, and timing of other auditing
procedures.

Test - The auditing assesses the reliability and sufficiency of the information contained in the
underlying accounting records and other source data by carrying out other tests, inquiries, and
other verification procedures of accounting transactions and account balances as he considers
appropriate in the particular circumstances. There are compliance tests and substantive tests to
examine the data. The vouching, verification and valuation technique is also used.

Comparison - The auditor determines whether the relevant information is properly

communicated by comparing the financial statements with the underlying accounting records
and other source data to see whether they properly summarize the transactions and events
recorded therein. The auditor can compare the accounting records with financial statements to
check that the same has been processed for preparing the final accounts of a business concern.

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Judgments - The auditor determines whether the relevant information is properly
communicated by considering the management’s judgment in preparing the financial
statements. The auditor assesses the selection and consistent application of accounting policies,
how the information has been classified, and the adequacy of disclosure.

Relevance of the Study

Research impact is variously defined but can be summarized as having an effect, benefit, or
contribution to economic, social, cultural, and other aspects of the lives of citizens and society
beyond contributions to academic research (Barnes, 2015). Researchers may have a broad
range of reasons for citing or otherwise interacting with a scientific publication. Formally
mentioning another paper can have meaning besides being a supposed proxy for research
quality. It is for this and other reasons that research evaluation has expanded into other forms
of metrics and the assessment of research impact.

In recent years, there has been a less rigid method of measuring research outputs, specifically
with regard to the influence of scientific research outside of academia. Measuring citations can
be seen sometimes as a closed system, showing which scientists cited other scientists with little
information about the broader reach of research. As funding agencies and research institutions
have begun to focus more on the return on investment, the emphasis on impact of research has
drawn more and more attention. An increasing emphasis on translational science may have
some part in the popularity of measuring research impact beyond academia.

 To thoroughly study the company data and make sure no fraudulent activity is taking
place
 Raise the good will of an organisation
 Make sure the company is working towards achieving its long term and short term goals
 Give a clear indication of the financial position of the company to the shareholders,
stakeholders and decision makers.

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 Methodology

The survey was conducted through google forms and circulated among a group of clients of
MR Hundiwala.
 Sampling Size – 30 People
 Sampling Type – Clients – Firms that are willing to share the auditing information
 Website Used – Google Forms
 Data analysis – Graphs and Pie Charts will be used to analyse the data collected

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 Questionnaire

 Name
 Industry you work with or your business falls under?
 Does your organization conduct audits regularly?
 What types of audits are carried out in your business?
 Do the audits have an impact on the functioning of the business?
 How does the audit benefit your company?
 Do the regular audits help in the building the goodwill of the company?
 How have audits helped build repertoire with the customers?
 Does the audit help in productivity and organization of a business?
 How often in your opinion should companies conduct audits in the particular sector?

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 Results

Q1. Industry your business falls under?

It has become evident from the above chart that various different types of sectors or industries
use the services of MR Hundiwala and also carry out audits in their respective companies. The
most number of companies belonged to the automobile sector and the next most popular sector
was the FMCG followed by the electronics sector.

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Q2. Does the organisation conduct audits regularly?

Majority of the companies do not carry out audits as regularly as some others, however these
companies do carry out audits periodically. An audit might be able to spot a small mistake
before it grows into a big one. Hence it is advised that companies carry out audits regularly to
avoid major mistakes that can be identified in the earlier stages.

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Q3. What types of audits are carried out in your business?

Majority of the companies carry out external type of audits as it builds trust in the minds of the
customers that any sort of misleading and unjust activity is not taking place in the organization.

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Q4. Do the audits have an impact on the functioning of the business?

The majority of the respondents agree that the audits have an impact on the functioning of the
business. The main function of an audit is to check for accuracy. As a result, an audit can
help you find errors in your accounting books or processes. An audit might be able to spot a
small mistake before it grows into a big one. And, non-IRS audits can catch errors before you
file your business tax return, helping prevent IRS audits.

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Q5. Do the regular audits help in the building the goodwill of the company?

Majority of the people agree that the audits help in building the goodwill of the company where
as a lesser, yet prominent number of people think it won’t. In particular, firms seem to report
goodwill impairments in a timelier fashion when they are audited by a Big 4 auditor, whereas
the timeliness seems to decrease with a higher non-audit fee ratio and a longer auditor tenure.
Moreover, additional analyses indicate that higher audit fees lead to more timely impairments.

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Q6. Does the audit help in productivity and organization of a business?

Yet again the audit process helps in productivity of the employees of the organization. An
operational audit could impact the productivity of the participating employees participating. If
the internal auditor typically performs other duties at the company, conducting the audit takes
them away from those responsibilities during its duration.

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Q7. How often in your opinion should companies conduct audits in the particular sector?

Majority of the companies conduct audits about twice a year and some more respondents about
more than 3 times a year. Critical or high-risk areas should be audited more frequently. This
could be done quarterly or twice a year. If the risk is low, conduct an internal audit just once a
year or every other year.

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 Interpretations

 Internal and external audits both seek to provide an independent opinion about a company’s
finances or practices. However, they differ significantly when it comes to who performs the
audit, its overall purpose, and its scope. Here is a closer look at these differences: Scope:
Internal audits usually focus on a specific area of a company, while external audits look
at all relevant financial information and any other practices that could confirm the
veracity of budget statements. Purpose: Internal audits focus on measuring current
performance and finding areas for improvement. External audits focus on proving the
accuracy and veracity of financial statements. Auditor: External auditors are from a
third party while internal auditors work on a company’s behalf. Internal auditors may help
prepare for external audits. For example, they can use automated systems for preparation,
compilation and review to organize for an external audit or assess internal performance.

 Some companies require internal audits for quality assurance of products that will be
shipped out to clients and customers. Such companies will have a set of control
measures that need internal auditing of products and manufacturing procedures. In this
case, internal audits can be done on a weekly or monthly basis. If your organisation’s
internal audits are infrequent, you may face operational, financial and security risks of
your organization. It will also impact every customer or client that works with you.
When the internal audit of your systems and controls become weak, it can in turn affect
the management staff and the morale of your employees. The problems in your system
and controls may build up to hurt the organization and you may have a tough time
bringing past production processes up to full capacity again.

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 Internal Audit is not compulsory by nature but can be conducted to review the
operational activities of the organization. In this type of auditing, the work area is
determined by the entity’s management. On the contrary, External Audit which is
obligatory for every separate legal entity, where a third party is brought to the
organization to perform the process of Audit and give its opinion on the Financial
Statements of the company. Here the working scope is determined by the respective
statute.

 Impact and influence accrue over time with each improved process, reduced cost, and
better-managed risk. Focusing on the areas listed above sets internal audit on a journey
up the value chain. Along the way, compliance becomes more efficient; reporting more
relevant; and advisory more credible, useful, and supportive.

 The influence of goodwill impairments on a firm’s financial position and profitability

give reason to doubt its current and future performance. We examine whether auditors,
as a crucial external monitor, identify the information risks of goodwill impairments
and express their concerns about financial reporting quality in their audit opinions.

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 Suggestions

 Get a sense of the top risks to the business through conversations with stakeholders,
internal observations, surveys, and industry analyses
 Coordinate with other assurance groups to assess and score risks in a top-down manner
 Tailor risk assessments to understand how various risks are interconnected and what
causes them
 Rank and prioritize the risks based on their impact and likelihood; make sure to get
management buy-in on the risk priorities
 Ensure that the areas of highest risk and the associated controls are audited more
frequently than others
 Conduct periodic reviews throughout the year to determine if the prioritization of risks
is still applicable
 Decide how to balance the time spent on advisory and assurance work based on the
organization’s strategy, stability, business environment, and other such factors
 Spend time understanding the organization’s business processes, strategy, and
performance indicators; that makes it easier to spot areas of concern, and add value to
discussions
 Balance hindsight with foresight; focus on forward-looking analyses that anticipate the
issues that could occur, so that the organization isn’t caught off-guard
 Communicate insights to stakeholders in a simple, succinct, and timely manner;
separate the signal from the noise
 Instead of providing too many details, focus on strategic questions such as “what caused
these risks or issues,” and “what can be done to prevent their recurrence”
 Engage actively with industry associations to exchange knowledge with peers, and to
understand how they are responding to stakeholder expectations for better insights

Page 36 of 38
 Conclusion

With an internal auditing system, your business can create accurate and reliable financial reports
through which you can gain insights on which segments or product lines are performing best and how
to properly allocate resources. Additionally, regular auditing will make your shareholders trust that your
accounts are true and fair and that it’s safe to invest in your business.

If the government audits your financial statements and finds that your business has been manipulating
its financial health, or hiding revenue and losses, you’ll likely deal with severe fees and legal
punishments. Your business will also acquire a bad reputation, and you will most likely lose reliability
in the eyes of your customers and stakeholders.

Recurring internal audits by a professional auditor or accountant of the company play an important role
in detecting these fraud cases before they become substantial and problematic. Having a rigorous
auditing system set in place alone prevents and scares employees or vendors from attempting a scheme
to defraud your business in the first place.

Page 37 of 38
 References

M.R. Hundiwala & Co. (n.d.). M R Hundiwala. https://mrh.org.in/

Investopedia. (2019, June 6). Investopedia. https://www.investopedia.com/

Encyclopedia Britannica. (n.d.). Encyclopedia Britannica. https://www.britannica.com/

Deskera. (2022). What Is Auditing? Definition, Types & Importance. Deskera

Blog.https://www.deskera.com/blog/what-is-auditing/#the-importance-of-auditing

Research Paper Topic Ideas & Suggestion for Students. (2021, August 18). Relevance in

Research | Meaning, Types | My Research Topics. Research Paper Topic Ideas &

Suggestion for Students. https://www.myresearchtopics.com/guide/relevance-in-

research/#:~:text=The%20relevance%20in%20research%20is,the%20pursuit%20of%

20new%20knowledge.

Page 38 of 38
 FEEDBACK FROM INTERNSHIP PROVIDER ORGANISATION

Internship Programme feedback form

Sr. Particulars Details

No.

1 Name of the Supervisor/Officer Utkarsha Ingale

2 Department Audit

3 Designation CA

4 Name of the Student Suditi Channey

5 Name of the College Christ College

6 Roll Number 55

7 Special Subject Cases in Finance

Please Turn over

Part – A – Individual Ranking (Please tick the suitable checkbox)

No. Parameter for the Excellent Very Good Satisfactory Needs

feedback Good Improvement

1 Domain Knowledge 

2 Communication Skills 

3 Punctuality and 
Dedication

4 Ability to work in 
teams

5 Problem solving skills 

6 Quality of work done 

7 Effectiveness 

8 Efficiency 

9 Ability to take 
Initiative

10 Positive attitude 

11 Appearance 

12 Using full Potential at 

work
13 Work habits 

14 Honesty and Integrity 

15 Creativity 
Part B – SWOC analysis of the student (Please mention below the strengths and
weaknesses of the student and the areas for improvement)

Strength: Good communication skills, Sincere at work

Weaknesses: More Focus on work required

Improvement: Analytical skills can be improved

Part C – Suggestions to make the internship programme more productive and effective.

1. Work hard with sincerity

2. Always show keen interest to learn new things

3. Be Innovative

4. Be Curious

5. Be patient

Please turn over

Part D – Changes required in the curriculum to improve employability of students.

1. Data Analytics should be included

2. Data Research should be included

3. Money market should be introduced

4. IT subject

5. Share market

Name, Designation and Signature of the Supervisor / Reviewing Officer Place of

Review:

Utkarsha Ingale

Chartered Accountant

Date of Review: 21/04/23

 STUDENT FEEDBACK FORM

1. Name of the Student: Suditi Channey

2. Class: TYBBA
3. Division and Roll Number: 55
4. Present address: 703 Onyx Building, Nyati Empire Kharadi Pune
5. Contact Number: 9766018963
6. Email id: [email protected]

Please provide your rating about following aspects pertaining to your Internship Experience
on the scale of 10; where 10 means strongly agree and 0 means do not agree at all.

Sr. Parameter Response

No.

1 The pre- internship training provided by the college was very useful 8

2 I was properly introduced to the task assigned to me in the 8

organisation

3 I was given proper guidance to carry out my responsibility 9

4 My supervisor / officer was very cooperative and supportive 8

5 I found my task interesting and worth learning 9

6 My supervisor / officer addressed to my queries/ doubts quickly 8

7 I received due respect from my colleagues in the organisation 8

8 The contents of the syllabus match with the practical work 7

9 The knowledge that I gained in the college was useful to carry out 7
internship programme in a satisfactory manner

10 The Internship Programme is very useful to enrich my knowledge 8

Please give your suggestions to make the internship programme more productive and effective.

1.Make the programme more related to the subjects taught.

2. The programme must be more flexible when it comes to the timing of completion rather than just

being confined to the last semester of the course.

3. The work should be able to initiate the students into the corporate world with ease.

Please give your overall feedback about your experience during the internship (Not mentioned
above).

The overall programme helped bridge the gap between the theoretical knowledge learned in the

confines of a classroom and the practical knowledge and experience desired by the recruiters of major

companies.

Suditi Channey

22/4/23