Page 138 - CA Inter MCQ Book

CA RAVI TAORI CA INTER AUDIT MCQs

During the audit, RAS & Associates notice few transactions for personal profiteering by members of the
management committee, which are ultimately detrimental to the interest of the society. RAS &
Associates report this matter to the required authority to take necessar y action.
After the conclusion of the audit, in addition to the audit certificate in the prescribed form and various
schedules, RAS & Associates also answered two sets of questionnaires called audit memos. The auditors
also submitted the audit report in a narrative form addressed to the Chairman of the society which was
divided into two parts styled as part I and part II.
I. “According to section 5 of the Central Act, what is maximum percentage of the total number of
shares and what is the maximum value of shareholding that RAS & Associates were concerned
with, so as to watch any breach relating to holding of shares?

(a). Twenty-five percent of the total number of shares or of the value of shareholding upto ` 5,000
(b). Twenty percent of the total number of shares or of the value of shareholding upto ` 5,000
(c). Twenty-five percent of the total number of shares or of the value of shareholding upto ` 1,000
(d). Twenty percent of the total number of shares or of the value of shareholding upto ` 1,000
II. “As per Section 29 of the Central Act, Best Tea House cannot give a loan to any person other than:

(a). A member and with the special sanction of the Registrar, relatives of the member not exceeding
an amount of ` 1000.
(b). A member and with the special sanction of the Registrar, another registered society.
(c). A member and with the special sanction of the Registrar, relatives of the member.
(d). A member and with the special sanction of the Registrar, another registered society not
exceeding an amount of ` 1000.
III. “Overdue debts for a period from _____________to_______ and more than _____ were classified
and reported by RAS & Associates.
(a). 3 months to 6 months and more than 6 months.
(b). 6 months to 3 years and more than 3 years.
(c). 6 months to 5 years and more than 5 years.
(d). 3 months to 5 years and more than 5 years.
IV. “To whom does RAS & Associates report the few transactions noticed during audit?
(a). Registrar of Co-operative Societies
(b). Secretary of Best Tea House.
(c). State Government
(d). Management Committee of Best Tea House
V. “Mistakes having an impact on the profitability of society were pointed out by RAS & Associates
as it had a consequential effect on the financial position of society. In which of the following
submissions was this information included?
(a). Part I of the audit report
(b). Part II of the audit report
(c). Schedules to the audit report
(d). Audit memos

51 (N21M)
A Partnership Firm of Chartered Accountants by the name of HS and Associates was appointed to audit
books of accounts of WT Limited for financial year 2019-20. HS and Associates consisted of two partners
CA H and CA S.

While conducting audit of WT Limited for financial year 2019-20, CA H, one of the partners of HS and

Associates used different audit procedures in order to obtain audit evidence.

The different audit procedures used by CA H were as follows:
(1) As WT Limited was engaged in manufacturing business of wooden doors, CA H and his team members
carefully watched the whole process of counting of finished wooden doors by employees of WT Limited.

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