ca,icwa,cs,acca,cima,cpa,icma,professional,accounting

Secretarial Management and Systems Audit

ca,icwa,cs,acca,cima,cpa,icma,professional,accounting
CS Final : Group I :: Paper 3: [One paper: Three hours - 100 marks]

Level of Knowledge : Expert knowledge.

Objective . . .

To develop skills of high order so as to provide thorough knowledge and insight into the role of company secretaries in rendering effective corporate advisory services and conducting secretarial / securities audit, management audit and systems audit.

Detailed Contents . . .

Part A: Secretarial Audit [40 Marks]

ca,icwa,cs,cima,icma,acca,cpa,accounting,profession
  1. Company Secretary in Practice

    Company secretary in practice; various recognitions and areas of practice; advisory services rendered; concept of self regulatory administration by exception; challenges before the profession; professional standards and code of conduct.
  2. Areas of Practice

    Existing areas of practice for company secretaries; exploring new horizons and carving fresh niches.
  3. Setting up of Professional Practice

  4. Secretarial Audit and Auditors

    Need, objectives and scope of secretarial audit, secretarial audit process, periodicity and format for secretarial audit report, appointment, duties and powers of secretarial auditor; check-list/work sheet for secretarial audit under various cor-porate laws and covenants of loan agreements entered into with financial institutions.
  5. Certification, Due Diligence and Signing

    Meaning and scope of certification; due diligence and signing of various documents under corporate and securities laws including signing of declaration with respect to incorporation of company and commencement of business; signing of annual returns; certification under buy-back of securities rules; certifications on the occasion of transfer of deeds.
  6. Pre-certification of Documents

    Rationale, pre-certification of documents required to be filed with the Registrar of Companies (ROC), Securities & Exchange Board of India (SEBI) and other administrative authorities.
  7. Search/Status Reports

    Preparation of search and status reports from ROCs records for banks and financial institutions; scope and impor-tance; verification of documents relating to charges; requirements of various financial institutions and other corporate lenders.
  8. Securities Audit

    Meaning, need and scope; ensuring proper compliance of provisions relating to issue and transfer of securities; providing mechanism for self-regulation by companies and instilling professional discipline; relieving the company and its directors from the consequences of unintended non-compliance by timely corrective action; preventing fraudulent and unfair trade practices including SEBI regulations framed thereon; protecting the interest of investors.
  9. Due Diligence of Pre-capital Issues Work

    Appraisal of documents relating to issues of capital viz., prospectus, letter of offer and other documents to be filed with SEBI, ROC, stock exchange and other authorities; ensuring compliance of listing formalities and other requirements.
  10. Due Diligence of Post-capital Issue Work

    Approval of post capital issue compliances including despatch of refund orders/ certificates etc. to investors; filing compliance certificates with SEBI and other authorities; ensuring compliance of listing guidelines.
  11. Share Transfer Audit

    Need and scope, appraisal of share transfer work, maintenance of Registers of members and debenture holders, processing dividend/interest warrants, certification of securities transfer in compliance with listing agreement with stock exchanges.
  12. Internal Audit of Depository Participants

    Logistics of depository system; role of depository participants; agreements to which depository participant is a party; scrutiny and records maintained by participants; audit of branches of depository; check-list for carrying out internal audit.
  13. Compliance Certificate

    Concept and need, appraisal of secretarial compliances, specimen compliance certificate.

Part B: Management Audit [40 Marks]

  1. Management Audit

    Meaning, nature and scope; principles and fundamentals of management audit; appraisal of management methods and performance; organisational needs for management audit.
  2. Operational Audit

    Meaning, nature, purpose and scope; business control and operational auditor; relation with internal audit, man-agement audit and financial audit; procedural steps in operational audit.
  3. Internal Audit

    ca,icwa,cs,cima,icma,acca,cpa,accounting,profession
    Forms of audit - propriety audit, compliance audit and efficiency audit; internal audit and statutory audit; nature, scope and techniques of internal audit; functions and responsibilities of internal auditors; organisational status of internal auditing function.
  4. Internal Control

    Nature, scope and elements; internal control distinguished from internal check and internal audit; techniques of in-ternal control system, flow charts, internal control questionnaires; steps for internal control and audit evaluation; audit testing need for sampling and various approaches to statistical sampling; inter-firm and intra-firm comparisons ratio and trend analysis; audit in depth.
  5. Review of Internal Control

    Review of purchasing operations; review of efficacy of management information system; review of selling and dis-tribution policies and programmes; review of manufacturing operations; review of personnel policies; appraisal of man-agement decisions.
  6. Cost Audit

    Nature, objectives and scope; cost audit distinguished from financial audit and management audit; cost audit as an aid to management, shareholders, and other external agencies and public; cost record rules; Cost Audit (Report) Rules; cost audit report.

Part C: Systems Audit [20 Marks]

  1. Systems Audit
    Nature, significance and scope of systems audit; steps involved in conducting systems audit; systems audit and management functions; systems audit of computerised secretarial functions; norms and procedure for computerisation, computers control and security; testing of computer systems documentation standards, policies and procedures, audit approach.

Readings


  • Taxman, New Delhi
    1. Depository participants ( Law & practice)
      • Vijay K. Gaba
  • Tata McGraw Hill Publishing Co. Ltd; New Delhi
    1. Contemporary Auditing
      • Kamal Gupta
  • ICSI publication
    1. Guidance Note on Secretarial Audit
    2. Guidance Note on Signing of Annual Return
    3. Guidance Note on Compilation of Search Status Reports and Certificates of Financial institutions
    4. Guidance Note on Pre certification of Documents required to be filed with the Registrar of Companies.
    5. Guidance Note on Compliance Certificate.
    6. Guidance Note on Code of conduct for Company Secretaries
    7. Guidance Note on Certificate of Managerial Appointment and Remuneration under Schedule XIII to the Companies Act, 1956
  • McGraw Hill international
    1. EDP Auditing Conceptual Foundation and practice, university of queenstand Australia
      • Ron vebes

References


  • Book Ltd; London
    1. The Board and Management Audit Business
      • H. Washbrook
  • Tata McGrew Hill publishing Company Ltd; New Delhi
    1. Cost and Management Audit
      • A.R. Ramanathan
  • Prentice Hall
    1. Management Audit
      • L. Conrad

Journals


  • ICSI, New Delhi
    1. Chartered Secretary
  • L.M Sharma, Post Box No. 2693, New Delhi 110005.
    1. Company Law Journal
  • Corporate Law Advisers, Post Bag No.3, Vasant Vihar, New Delhi.
    1. Corporate Law Advisers

Other Relevant Books



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