Page 312 - CA Final PARAM Digital Book.

QNO Comprehensive Audit Old Course--(M09R, N10R, N11R, N12R, M14R, N14R, N15R, M16M,
599.000 TITANIUM CNO – PSU.120 N16R, PM17, M17M, N17R, M18M, N18R, N18E, M19R, N19M, M20R,
N20M, N20E, SM21, M21M, N21M, M22M, N22M)
New Course-- (SM23)
The Comptroller and Auditor General of India has appointed a chartered accountant firm to conduct the
comprehensive audit of Metro Company Limited (a listed government company) which is handling the
Metro project of the metropolitan city for the period ending 31-03-2020. The work to be conducted
under Project A handled by the Metro Company Limited was of laying down railway line of 124
kilometres. [The chartered accountant firm reviewed the internal audit report and observed the
shortcoming reported about the performance of Project A regarding the understatement of the Current
liabilities and Capital work in progress by Rs. 84.68 crore.] Explain some of the matters to be undertaken
by the chartered accountant firm while conducting the comprehensive audit of Metro Company Limited.

OR
The Comptroller and Auditor General assists the legislature in reviewing the performance of public
undertakings. He conducts an efficiency-cum-performance audit other than the field which has already
been covered either by the internal audit of the individual concerns or by the professional auditors. He
locates the area of weakness for managements’ information. Explain stating clearly the issues examined
in comprehensive audit.
OR

The areas covered in comprehensive audit vary from enterprise to enterprise depending on the nature of
the enterprise, its objectives and operations. You are required to list down some of the broad areas to be
examined in comprehensive audit.
OR
XYZ & Co., a CA. firm was appointed by C&AG to conduct comprehensive audit of ABC Public
undertaking. C&AG advised to cover areas such as investment decisions, project formulation,
organisational effectiveness, capacity utilisation, management of equipment, plant and machinery,
production performance, use of materials, productivity of labour, idle capacity, costs and prices,
materials management, sales and credit control, budgetary and internal control systems, etc.
Discuss stating the issues examined in comprehensive audit.
OR
Solar Limited is a public sector undertaking engaged in production of electricity from solar power. It has
started a new project near Pondicherry with a new technology for a cost of` 9,750 crore. Though there is
delay in commencement of project and accordingly, there has been overrun in the cost. State the
matters C&AG while conducting Comprehensive Audit may cover in reporting on the performance and
efficiency of this project.
Answer ➢ The Comptroller and Auditor General assist the legislature in reviewing the performance of public
undertakings. He conducts an efficiency-cum-performance audit other than the field which has

already been covered either by the internal audit of the individual concerns or by the professional
auditors. He locates the area of weakness and extravagance for managements’ information

➢ The areas covered in comprehensive audit naturally vary from enterprise to enterprise depending
on the nature of the enterprise, its objectives and operations. However, in general, the covered
areas are those of investment decisions, project formulation, organizational effectiveness, capacity
utilization, management of equipment, plant and machinery, production performance, use of
materials, productivity of labour, idle capacity, costs and prices, materials management, sales and
credit control, budgetary and internal control systems, etc.

➢ Areas to be covered:
The areas covered in comprehensive audit naturally vary from enterprise to enterprise depending
on the nature of the enterprise, its objectives and operations. Some of the issues examined in
comprehensive audit are: (Below points should be explained in sentence form to make answer
more presentable)

Research and development programmes.
Project planning.

www.auditguru.in PARAM 15.4 | P a g e