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The Institute of Company Secretaries of India or commonly referred to as ICSI provides guidelines on auditing standards. The primary aim of ICSI auditing standards is to support the company secretaries (CS) in getting expertise in auditing techniques and tools. It also imparts the best auditing practices while performing the audit and also promoting standardisation and uniformity in maintaining the professional standards of the Company Secretary (CS). The ICSI issued the first four auditing standards, which will be applicable mandatorily on the audit assignments accepted by the auditor on or after 1st April 2020. These auditing standards issued by ICSI will bring significant changes in the quality of audits performed by the company secretaries and will also bring uniformity and consistency.
The basic aim behind reconstructing the auditing standards by ICSI is as follows:
The auditing standard issued by ICSI has been
divided into four parts, as shown below:
This Auditing Standard applies to the Auditor undertaking audit engagement under any statute. The auditing standard on Audit engagement deals with the auditor’s role and responsibilities relating to an audit engagement and also the process of entering into an understanding or an agreement with the appointing authority for auditing purpose. The Auditing Standard on Audit Engagement (CSAS-1) applies to the practising Company Secretaries or PCS as defined in the Company Secretaries Act, 1980, who commences the audit assignment as per:
fundamental objective of the auditing standard is to lay down for the auditor
basic principles and procedures which must be followed while accepting or
continuing with the Audit Engagement by agreeing to the terms of engagement
with the Appointing Authority or any changes therein and matters related
This auditing Standard issued by ICSI is applicable
to the Auditors in the following situations:
Read, More: Why Secretarial Audit is Mandatory for Companies?.
case there is any change in terms of audit management in the middle of the
ongoing audit, the auditor shall follow the standard and also initiate a
revised engagement letter following the terms of the standard prescribed.
Engagement means all the detailed
terms of reference of appointment, which will include the scope of audit,
remuneration and also the limiting conditions if any.
The auditor shall follow the following steps with regard
to the Audit Engagement:
The audit engagement letter shall include the
Communication shall be done by the auditor to the previous auditor if any before accepting the audit engagement.
The auditor shall accept the audit engagement within the limit of a number of audits.
The auditor must not have any substantial conflict of interest with the auditee. In case there is any conflict of interest, it must be disclosed by the auditor before accepting the audit engagement. The following points will be considered as substantial conflict of interest:
section covers specific protocols prescribed for the auditors to follow the
audit process and documentation. The basic aim of this standard is to prescribe
principles to an auditor:
Audit Documents here is referred to the working papers which is prepared or the
reports obtained by the auditor in connection with the audit.
The proper steps to
conduct an appropriate audit process and documentation have been listed below:
audit plan must be prepared by the auditor for conducting audit as per the
terms of audit engagement. Audit planning means to establish and develop an
overall audit process, including but:
auditee shall check the risk assessment with respect to the audit engagement
considering the following factors:
auditor must obtain sufficient information regarding the auditee which will be
relevant for conducting of audit and forming an opinion and its expression.
The auditor shall use systematic and comprehensive
checklists for auditing and also to verify the compliance requirements.
auditor shall get confirmations from third parties, wherever it is required,
with respect to information which is related to such party.
auditor shall check the Audit Evidence before getting into any conclusion.
case the auditor finds that the audit evidence is conflicting evidence the
auditor shall evaluate the extent and credibility of contradictory evidence to
reach into any conclusion or collect more evidence to resolve the conflict.
This auditing standard issued
by ICSI applies to the auditor undertaking audit under any statute. This
standard deals with the manner for forming auditor’s opinion on subject matter
of the audit. The basic objective of the auditor here is to prescribe the basis
and manner for evaluation of conclusions drawn from the audit evidence and also
to obtain and express the opinion through a written report.
Auditing Standard issued by ICSI applies to the auditor undertaking Secretarial
Audit, which is prescribed under Section 204 of the Companies Act, 2013 and SEBI
(Listing Obligations and Disclosure Requirements), 2015. The Standard deals
with the basis and manner to carry out the Secretarial Audit.
significant objective of this Standard is to set the principles for evaluation
of statutory compliances and also for corporate conduct of auditing.
This standard covers the following:
standards issued by ICSI are introduced with an aim to regularize the audit
conducts and also to have a single protocol for the auditors all over the
nation. These accounting standards will be applicable with effect from 1st
April 2020. The Company Secretaries will check the applicability
of the mentioned auditing standards by ICSI, in every audit as they have expertise
in auditing methods, tools and techniques. This will make the audit errorless,
professional, uniform and also fast.
Also, Read: An Internal Auditor: Why are they important in a Company?.
Deepti is a Law graduate with an avid interest in reading and very proficient in summarizing legal cases. She has enough experience in handling legal affairs of the company. In the initial days of her career, she has worked as a legal researcher and has 3+ years of experience.
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