Page 187 - CA Inter MCQ Book

CA RAVI TAORI CA INTER AUDIT MCQs
(a) Issue Qualified Opinion
(b) Issue Adverse Opinion
(c) Mention the fact of change in method in Emphasis of Matter Paragraph
(d) Issue Disclaimer of Opinion
IV. When the Auditor, after conclusion of an Audit exercise, is of the opinion that there are material
misstatements in the Financial Statements, but they are not pervasive, then what should an
Auditor do?
(a) Issue Unmodified Opinion
(b) Issue Qualified Opinion
(c) Issue Disclaimer of Opinion
(d) Mention it in Emphasis of Matter Paragraph
V. When the Auditor concludes that the financial statements are prepared, in all material respects,
in accordance with the applicable financial reporting framework, Auditor shall give:
(a) Modified Opinion
(b) Qualified Opinion
(c) Disclaimer of Opinion
(d) Unmodified Opinion

Chapter 09

88 (SM23)
Consider the following five descriptions: -
(A) Audit of “Implementation of Nagpur Metro Rail Project” was conducted by the Comptroller and
Auditor General of India.

Following is extract of few audit findings placed on website cag.gov.in.

“The location of New Airport station was not ideal from the viewpoint of ridership due to sparse
population in and around the station and also from the accessibility point of view.

Cotton Market station, the second additional station was projected to have high peak hour peak
direction trips but the work was kept on hold midway citing fund crunch due to non-release of
pending contribution from stakeholders. However, the situation could have been managed
through prioritization of works.”

(B) Another set of audit findings in respect of audit of Haryana Power Generation Corporation
Limited, a wholly owned government company responsible for operation of power generation
plants in state of Haryana is as under: -

“The main reason for low generation was higher variable cost of thermal power stations which
resulted in backing down of plants.”

(C) A report was tabled in Parliament highlighting main features of direct taxes administration of
country as mandated in Constitution of India. This report primarily discussed compliance to the
provisions of the Income Tax Act, 1961 and the associated rules and procedures etc. as applied
to administration of direct taxes including irregularities noticed in finalizing assessments etc.

(D) Radial finance corporation Limited is a government company. The audit of the company is
conducted by statutory auditors appointed by Comptroller and Auditor General of India.

(E) Bharat Insurance Company Limited is a general insurance government owned company. The
statutory auditor is appointed by Comptroller and Auditor General of India.

The annual report for a particular year also contains comments of statutory auditors on matters
such as whether company has carried out reconciliations in respect of its inter-company
balances with other government owned insurance companies.
I. Based upon plain reading of audit findings stated at Para (A), identify type of audit carried out by
office of the Comptroller and Auditor General of India.

www.auditguru.in 181 | P a g e