Bonus share

46.Contents of Audit Report
Under section 227 (2) every auditor is required to make report to the shareholders on the accountants examined by him and every balance sheet and profit and loss A/c and every document declared by law to be part of or annexed to the balance sheet and profit or loss A/C which are placed before the shareholders of the company at the general meeting during tenure of his office. The report has to state whether, in his opinion and to the best of his information and according to the explanations given to him, the said accountants give the information required by the Companies Act in manner so required and give a true and fair view.
i. In the case of the balance sheet, of the state of the company’s affairs as at the end of its financial year; and
ii. In the case of profit and loss account, of the profit or loss account for its financial year.
Sub-section (iii) of the section 227 required that the auditor’s report shall also state.
a. Whether he has obtained all the information and explanations which to the best of his knowledge and belief were necessary for the purpose of his audit;
b. Whether in his opinion, proper books of account as required by law have been kept by the company so far as appears from hiss examination of these books, and proper returns adequate for the purposes of his audits have been received from the branches not visited by him .
c. Whether the report on the accounts of any branch office audited under section 228 by a person other than the company’s auditor has been forwarded to him and how he has dealt with the same in preparing the auditor’s report.
d. Whether the company’s balance sheet and profit and loss A/C dealt with by the report are in agreement with the books of accounts and returns.
If any of the matters as referred to in section 227 (2) and (3) is answered in the negative or with the qualification the auditor has to state in his report the reasons for such answer.
The Auditor’s report shall also include a statement on such additional matters as specified by the Central Government under section 227 (4-A) of the Companies Act, This section empowers the Central Government to order the inclusion of certain matters in the auditor’s report.
The Institute of Chartered Accountants of India requires the auditor’s to ensure that the accounting standards are implemented in the presentation of financial statements covered by their audit reports. The deviation should be reported in the report.