Company audit using the example of Tycoon LLC. The nuances of conducting an internal audit at an enterprise, its organization and presentation of results Conducting an audit using the example of a real organization
4.1 Common mistakes, identified during the audit process
Typical mistakes are the following:
1) Lack of bank statements, erasures and corrections in bank statements.
2) Supporting documents for bank statements are not presented in full.
3) There is no bank stamp on the documents indicating acceptance of documents for processing.
4) Costs incurred in cashless transactions are written off directly to cost accounts, bypassing settlement accounts.
5) Violation of the procedure for the letter of credit payment form.
Lack of bank statements, erasures and corrections in bank statements. The completeness of bank statements is determined by their page numbering and the transfer of the account balance. The balance at the end of the period in the previous bank statement of the account must match the balance at the beginning of the period in the next statement. If unspecified corrections, erasures, stains, “bold” underlines and similar contamination are detected in the statement, the auditor must reconcile the information at the bank institution.
Supporting documents for bank statements are not fully presented. Each amount indicated in the bank statement must be confirmed by a supporting document. These may be payment orders, payment requests, memorial orders, receipts for announcements for cash contributions and other documents. The amounts on bank statements must fully correspond to the amounts indicated in the primary documents attached to them. If any supporting document is missing, the auditor should bring this to the attention of the head of the audited enterprise or his authorized person in writing. In the absence of supporting primary documents, the auditor should also reconcile the information at the bank institution.
Very often, the absence of supporting documents indicates cash fraud in cash upon receipt. Therefore, you should check the correctness and completeness of the funds deposited in the bank in cash. The verification is carried out by comparing the receipt for the announcement for a cash contribution, the cash book, the cashier's report and the bank statement for the corresponding date.
The documents do not have a bank stamp indicating acceptance of documents for processing. The primary supporting documents attached to the bank statements must contain the bank's stamp and the signature of the bank operator. If primary documents are identified without a bank stamp, the auditor should reconcile the information at the bank institution.
Expenses incurred on a non-cash basis are written off directly to cost accounts, bypassing settlement accounts. During the audit, when performing audit procedures for checking turnover and account balances, auditors establish the correspondence of the entries indicated in the bank statements with the entries in the order journal and statement No. 2 of the account. 51, 52, 55 (when maintaining a journal-order form of accounting). Particular attention is paid to transactions on bank accounts, which are reflected directly in the accounts of production and distribution costs (20 ... 44), bypassing settlement accounts.
In accordance with PBU 1/98, organizations must comply with the principle of temporary certainty of facts of economic activity. This means that the facts of the organization’s economic activities must relate to the reporting period in which they occurred, regardless of the actual time of receipt or payment of funds associated with these facts. Thus, the organization’s expenses must be accrued in correspondence between the accounts for property or production and distribution costs and accounts for settlements with suppliers (other debtors and creditors). In addition, accrual of debt to suppliers is one of the main methods of internal control.
5) Violation of the procedure for the letter of credit payment form. In accordance with Art. 867 of the Civil Code of the Russian Federation, when making payments under a letter of credit, the bank acting on behalf of the payer to open a letter of credit, and in accordance with its instructions, the issuing bank undertakes to make payments to the recipient of funds or to pay, accept or honor a bill of exchange or to authorize another bank (executing bank) to make payments the recipient of the funds or pay, accept or honor the bill of exchange.
In accordance with Art. 868 and 869 of the Civil Code of the Russian Federation, letters of credit can be revocable or irrevocable. The text of the letter of credit must clearly indicate whether it is revocable or irrevocable. If there is no such indication, then it is considered revocable.
Settlements under a letter of credit differ from the most common form of payment - payment orders in that the obligation to make payment assigned to the bank is not unconditional, but must be carried out only under certain conditions specified in the letter of credit.
In accordance with clause 5.7 of the Regulations on non-cash payments, the validity period and procedure for settlements under a letter of credit are established in the agreement concluded between the payer and the supplier. The agreement must indicate: the name of the issuing bank, the type of letter of credit and the method of its execution, the method of notifying the supplier about the opening of the letter of credit, a complete list and precise characteristics of the documents submitted by the supplier to receive funds under the letter of credit; deadlines for submitting documents after shipment of goods, requirements for their execution, etc. Analytical accounting must be organized for each letter of credit issued by the enterprise.
During the audit of DL-Holding LLC, the following distortions were identified, grouped in table 7.
Table 7 - Distortions identified during the audit of DL-Holding LLC
These misstatements are not significant, as they are within the materiality level (36800).
We will draw up a summary statement of correction of violations identified during the audit process. The summary list of corrections of violations is presented in Appendix G.
4.2 Completion of the audit of DL-Holding LLC
Upon completion of the audit, the economic entity sends a letter of explanation to the audit organization.
Explanations from the auditee's management economic entity may be provided to the auditor orally and in writing.
Written explanations from the management of the economic entity being audited can be provided to the auditor in the form of:
a) an official letter from this management with explanations;
b) a letter prepared by the auditor, containing the auditor’s point of view on certain issues, containing a record of the management of the audited economic entity agreeing with this interpretation;
c) officially certified copies financial statements economic entity, minutes of meetings of boards of directors, general meetings shareholders, etc. activities of the inspected economic entity, containing information about the position of the management of the inspected economic entity on certain issues.
Director of DL-Holding LLC V.I. Pavlova sends a letter to the auditing organization Auditor LLC. The letter to the auditor is presented in Appendix H.
Based on the results of the audit, the auditor sends written information to the director of the economic entity on the results of the audit.
The auditor's written information must be addressed to the director of the economic entity. It must be signed by auditors and other specialists who directly conducted the audit.
Written information is prepared during the audit and provided to the head of the economic entity subject to the audit at the final stage. It is drawn up in at least two copies.
The auditor's written information to the management of DL-Holding LLC is presented in Appendix I.
Based on the results of the audit, the auditing organization Auditor LLC draws up an audit report, and then an act on the fulfillment of the terms of the contract.
The auditor's report of LLC "Auditor" upon completion of the audit of LLC "DL-Holding" is presented in Appendix K.
The act on fulfillment of the terms of the contract for the provision of audit services is presented in Appendix L.
Introduction
1.8.1 Current lease
Conclusion
Regulatory acts
Introduction
In the conditions of the formation of market relations, as well as the emergence of new forms of ownership and new types of business transactions (operations related to trust management, rent, barter transactions, etc.), the need arose to build an effective system accounting, including accounting of assets - fixed assets.
Currently, despite the fairly large number regulatory documents regulating the accounting of fixed assets, there are methodological problems in accounting for fixed assets.
These include problems of restoration and depreciation of fixed assets, problems of harmonization of Russian and international systems accounting of fixed assets, lack of regulations governing the accounting of reconstruction and modernization of fixed assets, etc.
Considering the problems of accounting for fixed assets at the macro level, it should be noted the high degree of wear and tear of fixed assets, which causes the occurrence of emergency situations and low efficiency of their use.
Fixed assets are the material base and basis of any enterprise, and especially production, in the process of which goods and products are created, work is performed and services are provided. Accounting for fixed assets occupies an important place in the accounting system of an enterprise. The reliability of accounting for fixed assets allows you to correctly include their depreciation in costs and prime costs, avoid errors when calculating the property tax of an enterprise, accurately determine the amount of capital investments in the repair and construction of various facilities, and take them into account when reflecting other operations. The financial performance of an organization’s economic activities depends on the quality of management of fixed assets. In this regard, it is necessary to note the importance of accounting for fixed assets in an enterprise.
The reliability of accounting and reporting is confirmed as a result of audits. As a result of such checks, an audit report is drawn up, which may be of interest both to internal users of the enterprise (management, accounting, shareholders, etc.) and to external interested users (financial institutions, business partners, tax inspectorate, etc.) .
In addition, the availability of reliable information makes it possible to increase the efficiency of work in the capital market and allows one to realistically assess and predict the consequences of various economic decisions.
Thus, audits of fixed assets also play an important role in the economic life of an enterprise.
The object of study of this course work is the company LLC "Nord-Class". The subject of the study is the fixed assets of the enterprise.
The purpose of the study is to conduct an audit of fixed asset accounting using the example of the company Nord-Class LLC.
To achieve this goal, it is necessary to solve the following tasks:
?to uncover methodological basis audit of fixed assets;
?determine the goals, objectives and methodology for conducting an audit of fixed assets;
?carry out procedures for planning an audit of fixed assets: drawing up a letter of commitment and an agreement for the provision of audit services; familiarization with the activities of Nord-Class LLC; study and assessment of the accounting system and internal control of fixed assets; calculation of the level of materiality and audit risk; audit plan and program;
?conduct an audit of operations on the movement of fixed assets: control procedures and substantive procedures and their documentation;
?Based on the results of the audit, provide a written opinion and recommendations for improving the accounting and use of fixed assets.
The theoretical and methodological basis of the study are the works of domestic and foreign scientists and specialists in the field of accounting of fixed assets, as well as the current regulatory documentation governing this section of accounting.
The principles and methods of historical, logical and system analysis, methods of comparison, induction and deduction, as well as the accounting method and a number of its elements: accounts and double entry, assessment and calculation, documentation, inventory.
Information base Data from registers of synthetic and analytical accounting of consumer cooperation organizations were used. In the process of writing thesis regulatory and legislative, periodical, reference and educational materials on the topic under consideration were used.
The practical significance of this work lies in the fact that all recommendations for improving the accounting and use of fixed assets, developed based on the results of the audit, can be used in the activities of the Nord-Class LLC enterprise.
This work consists of an introduction, three chapters, a conclusion, a list of references, regulations, contains 30 tables and 13 appendices.
1. Theoretical aspects of fixed asset accounting
1.1 The concept of "fixed assets", classification. Accounting for the presence and movement of fixed assets
Fixed assets are means of labor that are repeatedly involved in the production process, while maintaining their natural form, and their value is transferred to the manufactured products in parts as they wear out.
Accounting for fixed assets is regulated by the following regulatory documents:
· Accounting Regulations “Accounting for Fixed Assets” PBU 6/01, approved by Order of the Ministry of Finance of the Russian Federation dated March 30, 2001 No. 26n.
· Decree of the Government of the Russian Federation of January 1, 2002 No. 1 “On the classification of fixed assets included in depreciation groups”, etc.
According to clause 4 of PBU 6/01, assets are taken into account as part of fixed assets if they:
· used in the production of products, when performing work or providing services, or for management needs and for provision by the organization for temporary use and possession;
· used longer than 12 months;
· will generate income for the organization in the future;
· will not be sold in the foreseeable future.
According to clause 5 of PBU 6/01, fixed assets are: buildings, structures, working and power machines, as well as equipment, measuring and control instruments and devices, computer equipment, vehicles, tools, working, productive and breeding livestock, perennial plantings, on-farm roads, etc.
Profitable investments in material assets are part of the property provided by an organization for a fee for temporary use in order to generate income. Thus, rental, rental, leasing objects are classified as fixed assets.
In addition, fixed assets include: capital investments in leased property, land and environmental management facilities, as well as funds aimed at radical improvement of land.
The useful life is the period during which the use of an item of fixed assets generates income for the organization or serves to achieve the goals of the organization. In accordance with Decree of the Government of the Russian Federation dated January 1, 2002 No. 1 “On the classification of fixed assets included in depreciation groups,” property is combined into 10 groups:
) all short-lived property with a useful life of 1 to 2 years inclusive;
) property with a useful life of more than 2 years up to 3 years inclusive;
) property with a useful life of more than 3 years up to 5 years inclusive;
) property with a useful life of over 5 years up to 7 years inclusive;
) property with a useful life of over 7 years up to 10 years inclusive;
) property with a useful life of over 10 years up to 15 years inclusive;
) property with a useful life of over 15 years up to 20 years inclusive;
) property with a useful life of over 20 years up to 25 years inclusive;
) property with a useful life of over 25 years up to 30 years inclusive;
) property with a useful life of over 30 years. This classification can be used for both accounting and tax accounting.
The accounting unit for fixed assets is an inventory item. An inventory item of fixed assets is an object with all fixtures and accessories or a separate structurally isolated item intended for certain independent functions. If one object has several parts that have different useful lives, each such part is accounted for as an independent inventory object in accordance with clause 6 of PBU 6/1.
There are three types of valuation of fixed assets: initial, restoration, residual.
The initial (book) value is formed at the moment the fixed assets enter into operation.
The replacement cost of fixed assets is the cost of reproduction of fixed assets based on current prices at the time of revaluation.
In the reporting, fixed assets are shown at their residual value, which is defined as the difference between the original cost and the amount of depreciation.
Thus, fixed assets are means of labor that are repeatedly involved in the production process, while maintaining their natural form, and their value is transferred to the manufactured products in parts as they wear out. Fixed assets intended exclusively for provision for a fee for temporary possession and use or for temporary use for the purpose of generating income are reflected in accounting and financial statements as part of profitable investments in tangible assets (account 03<#"justify">Credit accountsDebit Account 01 "OS"CreditDebit accountsAccount 08С 1- initial cost of own fixed assets at the beginning of the month Initial cost of fixed assets put into operation as a result of capital investments Initial cost of fixed assets put into operation received as a contribution of the founders to the authorized capital of the enterprise Cost of objects put into operation received free of charge Agreed cost fixed assets transferred from long-term lease to the ownership of the enterprise, the tenant Cost of fixed assets identified as a result of inventory Account 02 Amount of accumulated depreciation of retired fixed assets Account 08 Residual value of retired fixed assets Subaccount 91.2 Account 08 Account 03 Subaccount 91.1
1.2 Accounting for receipt and disposal of fixed assets
Fixed assets are received by the enterprise through the following channels:
· from the founders as a contribution to the authorized capital;
· as a result of construction;
· by purchasing for a fee;
· by gratuitous transfer;
· under a barter agreement.
Upon receipt of ownership of fixed assets in accounting on account 08<#"justify">audit accounting fixed asset
Table 2.
Typical accounting entries for the receipt and commissioning of fixed assets
No. Contents of transactionDebitCredit1. Fixed assets received from the founders 1.1 Debt of the founders on deposits was formed 75-1801.2 Fixed assets were received as a contribution to the authorized capital 0875-12. Fixed assets built 2.1 contract method2.1.1 The cost of contract work has been formed 08602.1.2 The cost of contract work has been taken into account 0108 2.2 economically2.2.1 Materials written off for construction 08102.2.2 Salary accrued to employees involved in construction 08702.2.3 Fixed asset facility put into operation 01083. Fixed assets purchased 3.1 not requiring installation3.1.1 Accrued to the supplier on invoice 08603.1.2 Delivery costs 0876,60,23 are taken into account. 3.1.3 Fixed assets object0108 was put into operation 3.2 requiring installation3.2.1 Accrued to the supplier for equipment 07603.2.2 Equipment handed over for installation 08073.2.3 Installation costs written off 0810,70,69. 3.2.4 Fixed assets object 01084 was put into operation. Fixed assets were received free of charge4.1 Fixed assets were accepted for accounting (account 91) 01914.2 Fixed assets were accepted for accounting (account 98) 0198-24.3 Depreciation of fixed assets was accrued (account 98) 20 0298-2 915. Fixed assets were received under an exchange agreement 5.1 Materials were sold under an exchange agreement 62915.2 The cost of materials was written off 91105.3 Fixed assets were capitalized 08605.4 The cost of materials and fixed assets was offset 6062
1.3 Revaluation of fixed assets
Revaluation - clarification of replacement cost<#"justify">· what objects are subject to revaluation: all fixed assets or separate groups of homogeneous fixed assets;
· methodology for reflecting revaluation in accounting accounts,
· persons responsible for carrying out the revaluation.
The result of revaluation is a depreciation or revaluation of the value of the property. After revaluation, the replacement cost is taken as the original cost<#"justify">No. Contents of transactionDebitCredit1. The amount of revaluation is credited to additional capital 1.1 The initial cost of fixed assets has been increased 01831.2 The accrued depreciation of fixed assets has been increased 83022. The amount of the revaluation is included in operating income 2.1 The initial cost of fixed assets has been increased 01912.2 The accrued depreciation of fixed assets has been increased 91023. The amount of the markdown is attributed to retained earnings (uncovered loss) 3.1 The initial cost of fixed assets is reduced 84013.2 The accrued depreciation of fixed assets is reduced 02844. The amount of the markdown is attributed to the reduction of additional capital 4.1 The initial cost of fixed assets is reduced 83014.2 The accrued depreciation of fixed assets is reduced 0283
1.4 Disposal (write-off) of fixed assets
Fixed assets leave the organization in the following cases:
.write-off due to unsuitability for further use
2.external sales
.gratuitous transfer
.transfers against a contribution to the authorized capital of another organization
.property rental, leasing
.sales under barter agreements, etc.
The cost of an item of fixed assets that is being retired or is not capable of bringing economic benefits (income) to the organization in the future is subject to write-off from accounting.
According to the Instructions for using the Chart of Accounts<#"justify">No. Contents of transactionDebitCredit1. Write-off of a fixed asset due to unsuitability 1.1 Write-off initial cost 01-B011.2 Write-off of depreciation 0201-B1.3 Write-off of residual value 9101-B2. Sale of property 2.1 Write-off of the original cost 01-В012.2 Write-off of depreciation 0201-В2.3 Write-off of the residual value 9101-В2.4 Received proceeds from the sale 62912.5 Accounted for VAT on the sale 91683. Gratuitous transfer of property3.1 Write-off of initial cost01-B013.2 Write-off of depreciation0201-B3.3 Write-off of residual value9101-B3.4 Write-off of expenses associated with the transfer9110,70,69. 4. Transfer to account for the contribution to the authorized capital 4.1 Write-off of the initial cost 01-В014.2 Write-off of depreciation 0201-В4.3 Write-off of the residual value 9101-В4.4 Accounted for financial investments 5891
For tax purposes, income and expenses from the liquidation of fixed assets are included in non-sales assets. In this case, accounting for expenses from liquidation is carried out at a time (except for cases of losses).
The organization determines profit (loss) from the sale or disposal of depreciable property on the basis of analytical accounting for each item on the date of recognition of income (expense). In this case, the profit received by the taxpayer is subject to inclusion in the income from sales in the reporting period in which the property was sold. And the loss is reflected in analytical accounting as other expenses of the organization in equal shares.
The disposal of fixed assets is documented using unified primary documents. When writing off an object due to unsuitability, it is necessary to draw up an Act on the write-off of fixed assets (except for motor vehicles) in form No. OC-4<#"center">1.5 Taxation of fixed assets
Value added tax (VAT)<#"justify">1.Fixed assets acquired for carrying out activities subject to VAT
2.Fixed assets put into operation
3. There is a properly executed invoice for the purchased fixed assets<#"center">1.6 Accounting for depreciation of fixed assets
Depreciation of fixed assets is carried out using one of the following methods of calculating depreciation charges:
with the linear method - based on the initial cost of the fixed asset object and the depreciation rate calculated based on the useful life of this object;
with the reducing balance method - based on the residual value of the fixed asset item at the beginning of the reporting year and the depreciation rate calculated based on the useful life of this item and the acceleration factor established in accordance with the legislation of the Russian Federation;
when writing off the cost by the sum of the numbers of years of its useful life - based on the original cost of the fixed asset object and the annual ratio, where the numerator is the number of years remaining until the end of the service life of the object, and the denominator is the sum of the numbers of years of the service life of the object;
when writing off the cost in proportion to the volume of production (work) - based on the natural indicator of the volume of production (work) in the reporting period and the ratio of the initial cost of the fixed asset item and the estimated volume of production (work) for the entire useful life of the fixed asset item.
Let's give brief description the named methods.
With the straight-line method, depreciation is calculated evenly over the years of operation:
A 2 = F b*N A / 100,
where A 2- annual depreciation charges; F b - initial (book) value of the fixed assets object, thousand rubles; N A - annual depreciation rate, years.
In this case, the annual depreciation rate is determined by the formula:
N a = 100% / T n. and
where T n. and - useful life of an object of fixed assets.
The useful life is the period of time justified by the enterprise as generating profit or serving to achieve the goals of the organization.
It is determined by regulatory deadlines or based on:
expected productivity or capacity of the applied fixed assets;
expected physical wear and tear in accordance with the operating mode (1-3 shifts), natural conditions, preventive maintenance system;
regulatory and other restrictions on the use of fixed assets (lease period).
When using the method of reducing the balance, depreciation is calculated based on the residual value of the fixed assets object at the beginning of the reporting year to depreciation rates:
A i = (F 6i- AI-1 ) * N A
where Ф 6i - residual value of the fixed assets object at the beginning of the i-th year; A i-1 - the amount of depreciation charges in i year; N A - depreciation rate.
When using this method, an enterprise can apply accelerated depreciation in accordance with the legislation of the Russian Federation.
Depreciation amount by year:
Year 1 - 120,000/8 x 2 - 30,000 rub.
Year 1 - (120,000 - 30,000) / 8 x 2 = 90,000/8 x 2 = 22,500 rubles.
Year 1 - (90,000 - 22,500) / 8 x 2 - (67,500/8) x 2 = 19,275 rubles.
Year 1 - (67,500 - 19,275) / 8 x 2 = (48,225/8) x 2 = 12,056 rubles.
Year 2 - (48,225 - 12,056) / 8 x 2 = (36,169/8) x 2 = 9042 rubles.
Year 1 - (36,169 - 9042) / 8 x 2 - (27,127/8) x 2 - 6782 rub.
Year 2 - (27,127 - 6782) / 8 x 2 - (20,345/8) x 2 = 5086 rubles.
Year 2 - (20,345 - 5086) / 8 x 2 = (15,259/8) x 2 - 3815 rub.
A total of 108,566 rubles were credited. This means that the company will continue to charge depreciation after 8 years.
The method of calculating depreciation based on the write-off of value by the sum of the number of years of its useful life. With this method, the annual amount of depreciation is determined based on the book value of the object and the ratio of the number of years remaining until the end of its useful life to the sum of the natural series of the number of years of useful use.
Example. Calculate depreciation based on the number of years of useful life. The book value of the object is 120 thousand rubles, the useful life is 8 years, the sum of the natural series of the number of years of useful use:
2 + 3 + 4 + 5 + 6 + 7 + 8 = 36.
Depreciation amount by year:
year - 120,000 x (8/36) - 120,000 x 0.22 = 26,400 rubles.
year - 120,000 x (7/36) = 120,000 x 0.19 = 22,800 rubles.
year - 120,000 x (6/36) = 120,000 x 0.17 = 20,400 rubles.
year - 120,000 x (5/36) - 120,000 x 0.14 = 16,800 rub.
year - 120,000 x (4/36) = 120,000 x 0.11" 13,200 rub.
year - 120,000 x (3/36) = 120,000 x 0.08 = 9600 rub.
year - 120,000 x (2/36) = 120,000 x 0.06 = 7,200 rubles.
year - 120,000 x (1/36) - 120,000 x 0.03 = 3600 rub.
The method of calculating depreciation in proportion to the volume of production (executed works). With this method, depreciation is accrued over time in proportion to the share in the total, predetermined volume of work.
In order to create investment conditions to accelerate implementation into production scientific and technical achievements and increasing interest in accelerating the renewal and technical development of the active part of fixed assets, enterprises have the right to use the method accelerated depreciation.
Accelerated depreciation is a targeted method of faster, compared to the standard service life of fixed assets, the complete transfer of their book value to production and distribution costs. Enterprises can apply the accelerated depreciation method in relation to fixed assets used to increase the production of computer equipment, new advanced types of materials, instruments and equipment.
Small enterprises, along with the use of accelerated depreciation to stimulate the renewal of machinery and equipment, can the first year of operation should be written off additionally as depreciation charges up to 50% of the book value of fixed assets with a service life of more than 3 years.
Example. A small enterprise purchased a metal-cutting machine worth 100,000 rubles. The depreciation rate is set at 15%. Then the enterprise has the right to write off the following as production costs using the accelerated depreciation method:
* 2 * 15 =100
In addition, in the first year of operation, the enterprise also has the right to write off 50% of the cost of production, i.e.
* 50/100 = 50,000 rub.
Thus, the estimated gross profit, and therefore taxable profit, is reduced in the first year by RUB 80,000.
The organization has the right to choose the method of calculating depreciation. However, for tax purposes, depreciation charges on fixed assets are calculated in accordance with Articles 258 and 259 of Chapter 25 of the Tax Code of the Russian Federation (11):
depreciable property is distributed into 10 groups in accordance with its useful life;
The taxpayer calculates depreciation using one of the following methods:
a) linear;
b) nonlinear.
The linear method of calculating depreciation is used for buildings, structures, transmission devices included in the eighth to tenth group of depreciable property. For the remaining depreciable property, the organization has the right to apply any of the two indicated methods of calculating depreciation.
Since 2009 nonlinear method depreciation is amended as set out in Article 259.2 of the Tax Code of the Russian Federation. The main news is that it is necessary to calculate depreciation not for each object, but according to depreciation groups.
Let us characterize the nonlinear method.
Depreciation must be calculated using the non-linear method every month - separately for each depreciation group. The formula here is as follows:
A = B * k / 100,
where A is the amount of depreciation for the month for the corresponding depreciation group;
B is the total balance of the corresponding depreciation group;
k - depreciation rate for the corresponding depreciation group.
At the same time, paragraph 5 of Article 259.2 of the Tax Code of the Russian Federation establishes the following depreciation rates by group:
first group - 14.3;
second group - 8.8:
third group - 5.6;
fourth group - 3.8;
fifth group - 2.7;
sixth group - 1.8;
seventh group - 1.3;
eighth group - 1.0;
ninth group - 0.8;
tenth group - 0.7.
Since depreciation must be calculated monthly, the total balance must be determined on the 1st of each month. Let's say, depreciation for January is determined based on the total balance determined as of January 1, depreciation for February is determined based on the total balance as of February 1.
When determining the total balance for each 1st day of the month, the following must be taken into account.
New fixed assets or intangible assets that appeared last month and were put into operation must be included in the appropriate depreciation group. And accordingly, their initial cost will increase the size of the total balance on the 1st day of the month following the month of commissioning.
It is necessary to take into account the change in the initial cost of objects in the case of completion, additional equipment, reconstruction, modernization, technical re-equipment, or partial liquidation.
If a company bought (or received as a contribution to the authorized capital or in the process of reorganization) a fixed asset that was in operation, then it must be included in the depreciation group in which it was listed by the previous owner. This rule is spelled out in paragraph 12 of the new edition of Article 258 of the Tax Code of the Russian Federation.
It is necessary to subtract from the total balance the residual value of fixed assets that are excluded from depreciable property due to long-term conservation, reconstruction, modernization or due to transfer for free use (clause 3 of Article 256 of the Tax Code of the Russian Federation). It is necessary to stop accruing depreciation on them from the 1st day of the month following the month when the object was excluded from the depreciable property (clause 8 of Article 259.2).
In this case, the residual value of the objects will be determined by the formula:
Sn = S * (1 - 0.01 * k)n
where Sn is the residual value after n months after the inclusion of the object in the corresponding depreciation group;
S - initial (or replacement) cost;
n - the number of full months from the date the object was included in the depreciation group until the day it was excluded from it (the months when the object was excluded from the depreciable property on one of the grounds provided for in paragraph 3 of Article 256 of the Tax Code of the Russian Federation are not taken into account);
k - depreciation rate (taking into account the increasing or decreasing coefficient) applied to the corresponding depreciation group.
This property must be included back in the depreciable assets from the 1st day of the month following the end of reconstruction, modernization, etc. (clause 9 of article 259.2).
If the property was disposed of in the current month, then on the 1st day of the next month the total balance of the corresponding depreciation group must be reduced by the residual value of the disposed object (clause 10 of Article 259.2). The residual value is determined using the formula given above.
And finally, the total balance must be reduced by the amount of depreciation accrued last month.
If, with the linear method, the amount of depreciation per month is determined by multiplying the original cost of the object by the depreciation rate for the given object, then with the nonlinear method, by multiplying the residual value of the object by the depreciation rate for the corresponding object.
Small enterprises, in accordance with the Federal Law "On State Support of Small Business" dated June 14, 1995 No. 88-FZ, can apply accelerated depreciation of fixed assets, twice the norms established for the corresponding types of fixed assets. Along with the use of accelerated depreciation, small businesses can additionally write off as depreciation charges up to 50% of the original cost of fixed assets with service lives of more than three years.
Thus, depreciation is calculated using one of the methods (methods) presented in Table 5.
Table 5.
Basic methods of calculating depreciation
For accounting purposesFor purposes tax accounting linear method; reducing balance method; method of writing off value by the sum of the numbers of years of useful life; method of writing off the cost in proportion to the volume of products (works); linear nonlinear methods. In this case, the taxpayer has the right to include in the expenses of the period expenses for capital investments in the amount of no more than 10% of the initial cost of fixed assets (except for those received free of charge). When calculating the amount of depreciation, the taxpayer does not take into account these expenses for capital investments.
The correspondence of accounts for depreciation accounting is presented in Table 6.
Table 6.
Basic operations for calculating depreciation
1.7 Accounting for repairs of fixed assets
Depending on the volume and nature of the repair work performed, repairs of fixed assets can be capital and current. They differ in complexity, volume and deadlines. Repairs of fixed assets can be carried out in an economic way, i.e. by the organization itself, or by contract (by third-party organizations).
In both cases, a list of defects is compiled for each object being repaired. It indicates the work to be performed, the start and end dates of the repair, the parts scheduled for replacement, the time standards for work and the manufacture of replacement parts, the estimated cost of repairs in an item-by-item context.
If major repairs are carried out in an economic way, then on the basis of the list of defects, work orders are issued in the chief mechanic’s department. The first copy of the work order is transferred to the repair shop, the second copy is sent to the accounting department to maintain analytical records for this order, and the third copy remains in the chief mechanic’s department to monitor the timing of the order. Based on the list of defects and the work order, documents are issued to obtain the necessary spare parts and materials from the warehouse, work orders for the manufacture, installation and restoration of individual parts and assemblies.
Expenses for the repair of fixed assets are charged to production costs for the period in which they arose.
Actual expenses associated with carrying out or paying for repairs of fixed assets can be charged directly to the accounts of production and handling costs from the credit of the corresponding material, cash and settlement accounts (accounts 10 “Materials”, 70 “Settlements with personnel for wages” and etc.).
Organizations, especially those with seasonal production, can create a repair fund to accumulate funds for repair work. To account for the repair fund, it is advisable to open a sub-account “Repair Fund” under passive account 96 “Reserves for future expenses”.
Deductions to the repair fund must be made on the basis of a planned cost estimate for all types of repairs.
Deductions to the repair fund are recorded in the following accounting entry:
Debit account 25 "General production expenses"
Credit to account 96 “Reserves for future expenses.”
When forming a repair fund, transactions for accounting for repairs of fixed assets carried out in an economic way are, as a rule, reflected in advance on the active synthetic account 23 “Auxiliary production”.
In the debit of this account, the actual costs of capital and current repairs of own fixed assets are taken into account, and from the credit, the actual cost of repair work is written off from the repair fund. The balance of account 23 is debit and shows expenses for unfinished capital or current repairs fixed assets. In the balance sheet, these costs are reflected under the item “Work in progress”.
The capitalization of construction and other materials received during the repair of fixed assets is carried out by debiting the corresponding material accounts (10) and crediting account 23 “Auxiliary production”.
Acceptance of a repaired object from overhaul is formalized by an acceptance certificate for repaired, reconstructed and modernized facilities. Upon receipt of the act by the accounting department, a note is made on the inventory card about the work performed. In addition, the acceptance certificate serves as the basis for writing off the actual cost of major repairs.
Write-off of the actual cost of repairs carried out economically using account 23 is recorded with the following entry:
Debit account 96 "Reserves for future expenses"
Credit to account 23 "Auxiliary production".
For major repairs carried out by contract, the organization enters into an agreement with the contractor. Acceptance of completed major repairs is documented by an acceptance certificate. Completed capital works are paid to the contractor based on the estimated cost of their actual volume. For the cost of completed capital work, contractors submit invoices to the customer, the acceptance of which is documented with the following entry:
Debit account 96 "Reserves for future expenses", subaccount "Repair Fund"
Credit to account 60 "Settlements with suppliers and contractors".
The costs of major repairs carried out by contract can be written off from the credit of account 60 to the debit of the accounts of production and distribution costs.
At the end of the reporting year, costs for repairs of fixed assets must be written off as production or distribution costs in the amount of actual costs incurred.
In this regard, the amount of the reserve that exceeds the actual repair costs incurred is reversed at the end of the year. If there is a shortage of repair funds by the amount of the deficiency, either an additional entry is made for accruals to the repair fund, or the specified amount is written off as production or distribution costs.
The balance in the subaccount “Repair Fund” of account 96 “Reserves for future expenses”, as a rule, should correspond to the costs of unfinished repairs of complex objects.
Organizations can first take into account the costs of repairing fixed assets in the debit of account 97 “Deferred expenses” (from the credit of material, settlement and other accounts or account 23), and from this account, as a rule, write off evenly throughout the year to production cost accounts ( appeals). This option for accounting for the costs of repairing fixed assets is advisable to use in those organizations in seasonal industries where the bulk of the costs for repairing fixed assets occur in the first months of the year, when the repair fund has not yet been created.
Depending on the chosen method of reflecting costs in accounting, operations for the repair of fixed assets are reflected in Table 7.
Table 7.
Typical entries for the repair of fixed assets
No. Contents of transactionDebitCredit1Repair costs are written off at a time20,25,26,4410,70,69,602. Formation and use of the repair fund 2.1 Monthly contributions to the repair fund 20,25,26,44962.2 Write-off of costs from the repair fund 9610,70,69,602.3 Write-off of the amount in excess of actual costs 9710,70,69,602.4 Write-off of the amount in excess of the repair fund 20,25,26,44963. Assignment of costs to deferred expenses 3.1 The amount of actual repair costs is written off 9710,70,69,603.2 monthly write-off of costs to the cost of production 20,25,26,4497
Reconstruction is the reconstruction of existing fixed assets associated with the improvement of production and the increase in its technical and economic indicators and carried out under a reconstruction project in order to increase production capacity, improve the quality and range of products.
Technical re-equipment is a set of measures to improve the technical and economic indicators of fixed assets based on the introduction of advanced equipment and technology, mechanization, production automation, modernization and replacement of obsolete and physically worn-out equipment with new, more productive ones.
Simply put, modernization and reconstruction are carried out with the aim of improving the quality characteristics of fixed assets. The costs of their implementation are included in the increase in the initial cost<#"center">1.8 Accounting for lease transactions of fixed assets
Lease as a type of business activity involves the transfer by one party (the lessor) to the other party (the lessee) for a fee for temporary possession and use or for temporary use of property in the form of non-current assets.
There are several options for classifying types of leases. From an economic point of view, two types of leases are considered:
·Current rental
· Financial lease - leasing
Let's look at each type.
1.8.1 Current lease
The property is leased under an appropriate agreement, according to which the lessor transfers the property for use to the lessee and charges rent, while the ownership rights remain with the lessor. The lessor charges depreciation on the transferred property and repairs it under the conditions specified in the contract. Accounting for fixed assets leased is maintained by the lessor in the subaccount "Fixed assets leased" to account 01 "Fixed assets"<#"justify">No. Contents of the business transaction Document Debit Credit 12345 In the lessor’s accounting 1. Reflection of business transactions on account 911.1 Transfer of lease of fixed assets Acceptance and transfer certificate 01/201/11.2 Accrual of depreciation on leased fixed assets, security, provision of electricity, heating and other expenses Accounting calculation 9102/2, 10,601.3 Accrual of the amount of rent (if the agreement provides for a periodic payment) Agreement, accounting calculation 62911.4 VAT accrued on rental payments Agreement, invoice 9168 L1DS1.5 Accrual of property tax on the value of the leased property Accounting calculation 9168/Property tax 1.6 Receipt of funds from the tenant Payment documents 51,50,52622. Reflection of business transactions in account 902.1 Reflects the costs associated with leasing the property Accounting calculation 20, 23, 25, 26, 29.44602.2 VAT accrued as part of the costs incurred Accounting calculation 19602.3 Payment of expenses incurred (accepted work, consumed services) Payment documents 60512.4 Tax deduction for amounts of VAT paid to suppliers of consumed resources that are associated with the rental of property Invoice 68/VAT 192.5 Accrued depreciation charges on property leased Accounting calculation 20, 23, 25, 26, 29.440 22.6 Reflects the sale of services for leasing property Invoice 62902 .7 VAT accrued as part of the rent Invoice 90682.8 The cost of services provided for leasing the property was written off Accounting calculation 9020, 23, 25, 26, 29, 442.9 The financial result from leasing the property (profit) was determined Accounting calculation 90992.10 Tax on the property leased was calculated for rentAccounting calculation9168/Property tax2.11Rent payments receivedPayment documents516212345
In the tenant's accounting
3.1Accounting for fixed assets received from the lessor at their original costAcceptance and transfer certificate of fixed assets0013.2Accrued amount of rent for reporting period Agreement, invoice 25, 26, 44603.3 VAT allocated as part of the rent Invoice 19603.4 Calculation of the amount of rent in advance for future reporting periods VAT Agreement, invoice 97, 1960, 603.5 Write-off of rent for the reporting period Accounting calculation 25, 26, 44973.6 Transfer of rent Payment documents 6050,51,523.7 Deregistration of leased fixed assets Acceptance and transfer certificate of fixed assets 001
1.8.2 Financial lease - leasing
Leasing can be: financial (direct) and operational.
Financial leasing provides for the repayment of the contractual value of the property during the term of the contract, as well as the payment of interest for the use of the property. Depending on the nature of the operations, financial leasing is divided into:
.Direct - after the end of the contract, the leased object becomes the property of the lessee
2.Returnable - the organization sells its property to the lessor and immediately the lessee takes it back for a long-term lease (convenient when it is necessary to obtain free funds)
.Mixed - based on the shared participation of the lessor and the lessee in the acquisition of the leased object.
Operational leasing implies that after the end of the contract, the property is returned to the lessor.
In exchange for the right of ownership and use, the lessee pays lease payments to the lessor.
Leasing payments - the total amount of payments under a leasing agreement for the entire term of the agreement, which includes:
· reimbursement of the lessor's costs for the acquisition and transfer of the leased asset to the lessee,
· reimbursement of costs associated with the provision of other services provided for in the contract,
· lessor's income.
The total amount may include the redemption price of the leased asset if the agreement provides for the transfer of ownership to the lessee. The lessor's accounting first reflects the acquisition of property intended for lease. Further operations depend on whether the leased asset will be included on the lessor’s balance sheet. By agreement of the parties, the leased asset is recorded on the balance sheet of the lessor or lessee.
Depreciation deductions are made by the person who has the leased asset on his balance sheet, and it is possible to use accelerated depreciation of the leased asset. Accounting for transactions with the lessor and lessee is presented in Table 9.
Table 9.
Accounting for leasing transactions
Accounting with the lessorAccounting with the lesseeProperty on the balance sheet of the lessorWhen transferring property to the lessee, its value is not written off from the balance sheet, the transaction is reflected in internal entries in account 03<#"justify">If the property is subject to redemption, then the lessee records the transfer of the leased property and the depreciation accrued on it to its own fixed assets.
1.9 Inventory of fixed assets
Inventory is carried out annually in accordance with the Methodological Instructions for Inventory of Property and Financial Obligations and on the basis of a written order from the manager (Form No. INV-22<#"justify">1.inventory cards, inventory books, inventories and other analytical accounting registers;
2.technical passports or other technical documentation;
.documents for fixed assets leased or accepted by the organization for storage.
When making an inventory of fixed assets, the commission inspects the objects and records them in the inventory (Form No. INV-1<#"justify">The results of the inventory must be reflected in the accounting and reporting of the month in which the inventory was completed, and for the annual inventory - in the annual accounting report.
The main operations for accounting for the inventory of fixed assets are presented in Table 10.
Table 10.
Correspondence of accounts for accounting of inventory results.
No. Contents of transactionDebitCredit1. Identified surpluses of fixed assets 01912 are taken into account. Accounting for shortages of fixed assets 2.1 Write-off of initial cost 01-B012.2 Write-off of depreciation on fixed assets 0201-B2.3 Accounting for shortages at residual value 9401-B3. Write-off of the shortfall at the expense of the guilty parties 3.1 Residual value 73-2943.2 Excess of market value 73-2983.3 Amount received to pay off the shortfall 50.5173-23.4 The difference between the market and residual value 98914 is written off. Write-off of the shortage at the expense of the organization9101
2. Methodology for auditing fixed assets accounting
2.1 Basic legislative and regulatory documents
The audit of fixed assets is carried out on the basis of the following regulatory documents.
Civil Code of the Russian Federation.
Tax Code of the Russian Federation, parts 1 and 2.
Law of the Russian Federation “On Accounting” No. 129-FZ of November 21, 1996, as amended and supplemented.
On the classification of fixed assets included in depreciation groups (Resolution of the Government of the Russian Federation of January 1, 2002 No. 1 with amendments and additions).
On unified depreciation rates for full recovery fixed assets National economy USSR (approved by Resolution of the USSR Council of Ministers No. 1072 of October 22, 1990).
Accounting Regulations “Accounting Policy of the Organization” PBU 1/98 (approved by Order of the Ministry of Finance of the Russian Federation No. 60n dated December 9, 1998).
Accounting Regulations “Accounting for Agreements (Contracts) for Capital Construction” PBU 2/94 (approved by Order of the Ministry of Finance of the Russian Federation No. 167 of December 20, 1994).
Regulations on accounting of long-term investments (approved by letter of the Ministry of Finance of the Russian Federation No. 160 dated December 30, 1993).
Accounting Regulations “Accounting for Fixed Assets” PBU 6/01 (approved by Order of the Ministry of Finance of the Russian Federation No. 26n dated March 30, 2001, as amended and supplemented).
Guidelines for accounting of fixed assets (approved by Order of the Ministry of Finance of the Russian Federation No. 91n dated October 13, 2003, as amended and supplemented).
Accounting Regulations “Organization Expenses” PBU 10/99 (approved by Order of the Ministry of Finance of the Russian Federation No. ЗЗн dated May 6, 1999 with subsequent amendments and additions).
Accounting Regulations “Accounting for Income Tax Calculations” PBU 18/02 (approved by Order of the Ministry of Finance of the Russian Federation No. Ts4n dated November 19, 2002).
Guidelines for inventory of property and financial obligations (approved by Order of the Ministry of Finance of the Russian Federation No. 49 of June 13, 1995).
Chart of accounts for accounting of financial and economic activities of enterprises and instructions for its application (approved by Order of the Ministry of Finance of the Russian Federation No. 94n dated October 31, 2000 with subsequent amendments and additions). %
About approval unified forms primary accounting documentation on accounting of fixed assets (Resolution of the State Statistics Committee of the Russian Federation No. 7 of January 21, 2003).
On approval of unified forms of primary accounting documentation for recording work in capital construction and repair and construction work (Resolution of the State Statistics Committee of the Russian Federation No. 100 of November 11, 1999).
On approval of unified forms of primary accounting documentation for accounting of labor and its payment, fixed assets and intangible assets, materials, low-value and wearable items, work in capital construction (Resolution of the State Statistics Committee of the Russian Federation No. 71a of October 30, 1997, as amended and supplemented).
Resolution of Rosstat "On approval of statistical tools for organizing statistical monitoring of fixed assets and construction for 2008." No. 28 of March 16, 2007
All-Russian classifier of fixed assets OK 01E*94 (approved by Resolution of the State Standard of the Russian Federation No. 359 of December 26, 1994 with amendments and additions).
2.2 Goals and objectives of the audit of fixed assets
The purpose of an audit of operations with fixed assets is to establish the reliability in all material respects of the reflection in accounting and reporting of transactions for the acquisition, operation and disposal of fixed assets, as well as to form an opinion on the compliance of the accounting and reporting procedures in terms of reflecting these operations.
The objectives of the audit of fixed assets are:
) study of the composition and structure of fixed assets;
) storage and operating conditions;
) confirmation of the initial assessment of the internal control system and accounting system;
) checking the correctness of registration and reflection in the accounting of operations of the movement of fixed assets;
) assessment of accrued depreciation and the reliability of its reflection in accounting;
) establishing the volume of repairs performed on fixed assets and the correctness of reflecting the corresponding expenses in accounting;
) confirmation of the results of the revaluation of fixed assets carried out in the reporting year;
) assessment of the quality of the inventory carried out.
Thus, the main task of the audit of fixed assets is to confirm information about fixed assets in the financial statements; the auditor needs to study the entire set of presented financial statements and establish that:
) data on the residual value of fixed assets at the beginning and end of the reporting period, entered in the balance sheet or the General Ledger, corresponds to the data on line 120 “Fixed assets” of the Balance Sheet (form No. 1);
) data on the accrued amount of depreciation is included in line 020 “Cost of goods, products, works, services sold” of the profit and loss statement (form No. 2). Line 090 “Other income” of Form No. 2 should show income from the sale of fixed assets, and line 100 “Other expenses” should reflect the residual value of the assets sold;
) line 210 of the cash flow statement (form No. 4) shows the proceeds from the sale of fixed assets, line 290 shows the acquisition of fixed assets;
) the data in section II "Fixed assets", specified in the appendix to the balance sheet (form No. 5), corresponds to the analytical accounting data for accounts 01 "Fixed assets", 02 "Depreciation of fixed assets".
The auditor must study the composition and structure of fixed assets according to the analytical accounting registers (inventory cards for recording fixed assets, statements, etc.). In the process of studying, the correctness of classifying the objects taken into account as fixed assets, their classification, as well as the formation of inventory objects is determined.
2.3 Sources of information used in the audit of fixed assets
Sources of information used in the audit of fixed assets depend on the company’s accounting policy. This is expressed in the choice of methods for calculating depreciation, putting fixed assets into operation, etc.
Operations on fixed assets must be documented using unified interdepartmental forms of primary accounting documentation. The main sources of information necessary for the audit are:
· act of acceptance and transfer of fixed assets (except for buildings, structures) - f. No. OS-1;
· act of acceptance and transfer of a building (structure) - f. No. OS-1a;
· act on acceptance and transfer of groups of fixed assets (except for buildings, structures) - f. No. OS-16;
· invoice for internal movement of fixed assets - f. No. OS-2;
· act on acceptance and delivery of repaired, reconstructed, modernized fixed assets - f. No. OS-3;
· act on write-off of fixed assets (except for vehicles) - f. No. OS-4;
· act on write-off of motor vehicles - f. No. OS-4a;
· act on write-off of groups of fixed assets (except for vehicles) - f. No. OS-46;
· inventory card for accounting of fixed assets - f. No. OS-6;
· inventory card for group accounting of fixed assets - f. No. OS-6a;
· inventory book for accounting of fixed assets - f. No. OS-66;
· act of acceptance (receipt) of equipment - f. No. OS-14;
· act of acceptance and transfer of equipment for installation - f. No. OS-15;
· act on identified equipment defects - f. No. OS-16;
· order journals No. 13, 10 and 10/1 - for maintaining synthetic records of the movement of fixed assets and their depreciation (with a journal order form of accounting), and when using computer information technologies- machine diagrams of debit and credit turnover for account 01, 02;
·main book;
balance (form No. 1);
· profit and loss statement (form No. 2);
· statement of changes in capital (form No. 3);
· Appendix to the balance sheet (form No. 5);
· explanatory note;
· other documents, certificates, calculations, etc.
Work during the audit of fixed assets can be divided into two stages: preparatory and main.
On preparatory stage the following actions must be taken:
.Familiarize yourself with the accounting policy of the enterprise in terms of organizing the accounting of fixed assets in the audited reporting period.
2.Familiarize yourself with the composition of the commission appointed by the manager to control the movement and liquidation of fixed assets.
.Establish a circle of financially responsible persons, make sure that there are agreements with them on full financial responsibility.
.Familiarize yourself with the results of the latest inventory (at the same time, check for the signatures of all members of the inventory commission, check whether there were any written objections to the acts of individual members of the commission).
The main stage includes audit procedures regarding the accounting of fixed assets.
The main directions of the audit of fixed assets accounting should ensure:
· control over the availability and safety of fixed assets;
· correctness of classifying items as fixed assets;
· correct assessment of fixed assets in accounting;
· correct registration and reflection in accounting of transactions on receipt and disposal of fixed assets;
· correctness of calculation and recording of depreciation and repair of fixed assets;
· correct reflection of data on the availability and movement of fixed assets in accounting and reporting.
In accordance with the main directions and objectives of the audit of fixed assets, four areas of verification can be distinguished:
) audit of the availability and safety of fixed assets;
) audit of the movement of fixed assets;
) audit of the correctness of depreciation calculation;
) checking the correctness of taxation on fixed assets.
An audit of fixed assets accounting is carried out on the basis of a general plan and program for the audit of fixed assets. The general plan for checking fixed assets should take into account the named areas of audit of these areas. Let's consider each direction and give them characteristics.
2.4.1 Checking the availability and safety of fixed assets
The auditor needs to check:
whether the enterprise has created a commission for the acceptance of fixed assets and registration of its results;
whether contracts for the purchase and sale of fixed assets have been drawn up;
whether protocols of the contract price have been drawn up;
whether the initial cost of fixed assets is correctly indicated in the acceptance certificates;
whether the initial cost after completion, additional equipment, reconstruction or partial liquidation of objects is correctly reflected.
Based on the data from checking the state of control and accounting of fixed assets, the auditor will be able to draw a conclusion about the effectiveness of control.
An important condition for ensuring the safety of fixed assets is a high-quality inventory of them. Therefore, during the control process, it is necessary to check its completeness and timeliness, as well as the correctness of the results being reflected in the accounting records. This is necessary for the auditor to know how much one can trust the results of the inventory carried out at the enterprise in order to reduce audit risk.
When checking the status of fixed asset accounting, you need to make sure that analytical accounting is organized correctly.
In order to gain a deeper understanding of the control and accounting of fixed assets, the auditor should require the enterprise to compile a detailed list of all fixed assets owned by the enterprise at the date of the report, broken down by type. This list must be accompanied by information about the reduction or revaluation of the value of fixed assets, information about fixed assets leased by the enterprise from other enterprises and organizations.
Fixed assets are reflected in accounting not systematically, but as transactions are performed, which affects the correctness of depreciation calculation and its inclusion in distribution and production costs.
Accumulated depreciation charges are calculated as of the reporting date. Despite the fact that the list of fixed assets contains extensive information about the availability of fixed assets and their movement during the year, the auditor also needs to obtain documents reflecting the receipt, disposal, and movement of fixed assets. According to the documents and accounting records in them, you can verify how correctly the operations on the movement of fixed assets were reflected in account 01 “Fixed Assets”.
Confirmation of data on business transactions for accounting of fixed assets is an extended procedure, since the bulk of the data is contained in external and internal documents. The use of documents such as invoices, contracts, lease agreements, insurance policies, tax inspection marks (acts) will allow the auditor to obtain convincing information about the audited object. If auditors require more complete data than can be obtained from accounting registers, they should consult letters addressed to landlords, insurance companies and government agencies.
Documentary evidence of business transactions for fixed assets is the process of selecting an account item and tracing in reverse order, i.e. search for source documents confirming the correctness account. For fixed assets, auditors can make a sample to establish the fact of receipt and disposal of fixed assets, as well as identify repair items for which significant funds were spent. The random sampling method can also be used. In this way, it is possible to establish the amounts of taxes and expenses for insurance of fixed assets reflected in the accounting.
In the process of auditing fixed assets, the recalculation technique is widely used, which must be carried out when checking depreciation charges and estimates of disposal and write-off of fixed assets. Accumulated wear exists as an arithmetic value, so determining its reality is only possible through recalculation.
2.4.2 Checking the accounting of the movement of fixed assets
Ways of receipt of fixed assets for the enterprise:
purchasing for a fee from suppliers;
free admission;
founders' contributions to the authorized capital;
repurchase of leased fixed assets;
return of property (fixed assets) under a joint venture agreement.
The receipt of fixed assets is documented by an act of acceptance and transfer of a fixed asset object (form OS-1) with technical documentation for this object attached to it.
Reasons for disposal of fixed assets at the enterprise:
liquidation of an object due to dilapidation and wear and tear, as well as due to force majeure circumstances;
liquidation due to re-equipment, modernization;
transfer of fixed assets to other organizations.
To determine the unsuitability of fixed assets at the enterprise, a special commission is created. The commission formalizes the liquidation of objects with an act for writing off fixed assets (form OS-3), which is approved by the head of the enterprise. Based on it, the accountant puts on the card the date of disposal of the object, which is approved by the head of the enterprise. Based on it, the accountant puts on the card the date of disposal of the object and the act number.
In places where fixed assets are used (in workshops and departments of the enterprise), inventory lists of fixed assets are maintained (form OS-9), containing brief information about fixed assets that are in operation.
Inventory cards for incoming, outgoing and transferred fixed assets within the enterprise after the necessary entries are not laid out until the end of the month, but are stored separately. This is necessary, since on their basis a monthly calculation of depreciation of fixed assets (wear and tear) is compiled. In addition, at the end of the month, cards with entries for a given month are grouped by classification types of fixed assets, then the turnover of receipts and disposals for each type is summed up and recorded in the card for recording the movement of fixed assets.
It is necessary to check the correctness of the valuation of fixed assets, since an incorrect valuation can not only distort the overall picture, but also cause:
inaccurate calculation of depreciation;
incorrect reflection of fixed assets in accounting (financial) statements.
When auditing operations on the movement of fixed assets, you should pay attention to the following points:
when transferring fixed assets as a contribution to the authorized capital, a list of them must be provided indicating the initial cost, depreciation and the price of the agreement upon transfer. The list must be accompanied by second copies of the transfer and acceptance certificates, certified by the seal of the transferring party, and all technical documentation for the transferred objects;
when purchasing fixed assets, a purchase and sale agreement must be drawn up indicating the original cost, depreciation and purchase price;
when purchasing fixed assets as a set (for example, office furniture), a breakdown must be included in the inventory card - a list of individual items included in the set;
when purchasing fixed assets for foreign currency, the initial cost of the object must be taken into account at the converted exchange rate in rubles at the time of acquisition;
capital construction facilities that are in temporary operation, before they are put into permanent operation, are not included in fixed assets, but are accounted for as unfinished capital investments;
objects of fixed assets accepted for operation under the terms of the current lease are accounted for in off-balance sheet account 001;
in the case of a gratuitous transfer of fixed assets, they are subject to VAT from the transferring party, with the exception of the gratuitous transfer of fixed assets previously included in fixed assets with VAT (for the non-production sector);
to determine the unsuitability of fixed assets, the impossibility or ineffectiveness of their restoration, as well as to draw up the necessary documentation for write-off at the enterprise, a permanent commission must be created by order of the manager;
if equipment is written off in connection with the construction of new, expansion, reconstruction and technical re-equipment of existing enterprises, then the list of this equipment must be indicated in the plan for expansion, reconstruction and technical re-equipment of existing enterprises;
all parts, components and assemblies from disassembly and dismantling of equipment suitable for further use must be recorded in the warehouse. This operation is reflected in the accounting entry (D 10-K 01).
2.4.3 Checking depreciation calculations
During the audit, it is necessary to establish whether all fixed assets are taken into account when calculating depreciation, whether it is calculated taking into account the movement of fixed assets, and whether depreciation rates are applied correctly.
Depreciation is accrued for all types of fixed assets, with the exception of land and natural resources, housing facilities and external improvement, library fund, museum and artistic values, productive animals listed on the balance sheet of the enterprise.
For an object of fixed assets, depreciation charges begin on the first day of the month following the month the object was accepted for accounting, and are accrued until its cost is fully repaid or written off from accounting in connection with the termination of ownership or other property rights.
Depreciation charges for an item of fixed assets cease from the first day of the month following the month of full repayment of its cost or write-off from accounting.
Depreciation charges for fixed assets are reflected in the accounting records of the reporting period to which they relate and are accrued regardless of the organization's performance in the reporting period.
Depreciation charges for fixed assets are reflected in accounting by accumulating amounts in a separate account.
Currently, the following depreciation options can be used:
) reducing balance method;
) method of writing off value by the sum of the numbers of years of useful life;
) method of writing off the cost in proportion to the volume of products (works).
During the reporting year, depreciation charges for fixed assets are accrued monthly, regardless of the accrual method used, in the amount of 1/12 of the annual amount.
Here it is important to establish the correctness of assigning fixed assets to the appropriate group of depreciation charges. To check the correctness of attribution of depreciation to cost accounts or other sources, it is necessary to establish what type of fixed assets they belong to - whether they are for production or non-production purposes.
When checking depreciation, the auditor must pay attention to Special attention for the calculation of depreciation on fixed assets not related to industrial production (for example, cultural objects), determine whether it is included in the cost of production. This is done in order to reduce the costs of maintaining non-industrial facilities, and such cases are identified during inspections.
Due to the fact that at present many enterprises are idle or operate in less than two shifts, are in reserve or mothballed, an important element of the check is the uniform suspension of depreciation or the application of reducing factors to the current standards (most depreciation standards are established based on two-shift operation of equipment ).
It is important to check whether depreciation continues to accrue on fixed assets that are already fully depreciated; Are there any errors in determining depreciation rates, especially for those fixed assets whose documents do not indicate codes?
When monitoring depreciation, it is necessary to take into account that some enterprises are allowed to use the method of accelerated depreciation of the active part of production fixed assets. Accelerated depreciation is applied and documented by the enterprise as an element of its accounting policy.
When checking the calculation of depreciation of fixed assets, you should check how depreciation is calculated by type and depreciation groups for tax purposes in accordance with Articles 257 and 258 of the Tax Code of the Russian Federation.
If the auditor discovers errors, it is necessary to bring information about them to the attention of the client, offer to correct them and make the necessary adjustments to the registers and reporting forms.
For all cases of incorrect depreciation calculation, the amounts of over-accrued or under-accrued depreciation are determined. They establish how this affected the cost of production and financial results, identify the causes of violations and those responsible, and propose measures to prevent similar shortcomings in the future.
2.5 List of audit procedures
The audit organization and the individual auditor must obtain appropriate audit evidence in order to formulate reasonable conclusions on which the auditor’s opinion on the correctness of accounting and the reliability of accounting (financial) statements is based (See Appendix 13).
Audit evidence is obtained through a series of tests of internal controls and the necessary substantive procedures.
When collecting audit evidence, the auditor can apply several types of audit procedures in accordance with Federal Rule (Standard) No. 5 “Audit Evidence”. Thus, when checking the accounting of fixed assets, the following methods of obtaining evidence are used:
checking the arithmetic calculations of the audited entity (recalculation);
inspection;
observation;
confirmation;
analytical procedures.
Checking arithmetic calculations is used to confirm the reliability of calculations of accrued depreciation amounts
on fixed assets, tax calculations, reporting indicators, etc.
Inspection is a check of records and documents when checking the accounting and reflection of transactions for settlements of fixed assets.
Observation is the auditor's monitoring of a process or procedure performed by others to account for transactions with fixed assets.
Confirmation is used to establish the actual transfer and acceptance of contributions of fixed assets to joint activities, authorized capital of other organizations, etc.
Analytical procedures are used when comparing the availability of fixed assets in different periods, report data on their movement, assessing the relationships between different items and reporting forms, etc.
In addition, the auditor must be present during the inventory of fixed assets or, if necessary, conduct it independently.
2.6 Typical violations in accounting for transactions with fixed assets
The following typical violations in accounting for fixed asset transactions are identified.
Incorrect accounting of assets as fixed assets.
Inaccurate fulfillment of the criteria for classifying property as fixed assets or assets in circulation.
Carrying out accounting of fixed assets by groups, rather than by inventory items.
Inaccurate determination of the initial cost of fixed assets when accepting them for accounting.
Inaccurate reflection of changes in the initial cost of fixed assets, in which they are accepted for accounting, in cases of completion, additional equipment, reconstruction, partial liquidation and revaluation of fixed assets.
Irregular revaluation of fixed assets.
Inaccurate reflection in the accounting of amounts of depreciation and revaluation.
8. Accrual of depreciation amounts above the cost of fixed assets.
9. Inaccurate determination of the useful life of an item of fixed assets when accepting the item for accounting.
Suspension of depreciation charges during the useful life of a fixed asset without sufficient grounds (for example, conservation of fixed assets).
Inaccurate reflection in the accounting of the restoration of fixed assets carried out through repair, modernization and reconstruction.
The cost of an item of fixed assets that is disposed of or is not constantly used for the production of products, performance of work and provision of services, or for the management needs of the organization, is subject to write-off from accounting.
3. Conducting an audit of fixed assets accounting using the example of the company Nord-Class LLC
3.1 Organizational and economic characteristics of Nord-Class LLC
Limited Liability Company Nord-Class LLC, approved by the decision of the constituent meeting on July 17, 1998, in accordance with Article 87-94 of the Civil Code of the Russian Federation, Federal Law Russian Federation"On Limited Liability Companies" No. 14-FZ dated 02/08/1998
The main activities provided for by the charter of Nord-Class LLC:
?construction and reconstruction, including the construction of production and non-production facilities on a turnkey basis within the established time frame;
?production of mortar, concrete, simple reinforced concrete, metal, reinforcement and wooden products.
The enterprise also has the right to carry out any activity not prohibited by legislative acts of the Russian Federation.
The enterprise owns, uses and disposes of the property assigned to it within the limits established by the Agreement on Assignment of Property, with the rights of full economic management .
The sources of formation of property and financial resources of the enterprise are:
?depreciation deductions;
?profit received from the sale of works, services, as well as from other types of economic activities;
?loans from banks and other lenders;
?other sources permitted by the legislation of the Russian Federation.
The enterprise independently disposes of the profit received as a result of the enterprise’s activities, remaining after paying taxes and other obligatory payments.
Currently, Nord-Class LLC compulsorily submits quarterly and annual financial statements (Appendices 1, 2, 3,4).
As of January 1, 2010, the residual value of the enterprise's fixed assets was 537 thousand rubles. For 2009, fixed assets were accepted for accounting in the amount of 250 thousand rubles, retired in the amount of 158 thousand rubles, the amount of accrued depreciation amounted to 102 thousand rubles.
The accounting policy of Nord-Class LLC was formed in accordance with PBU 1/08 and is the main document regulating the maintenance of accounting and tax accounting (Appendix 5).
3.2 Planning an audit at Nord-Class LLC
Before the start of the audit, the audit organization draws up a letter of undertaking to Nord-Class LLC agreeing to conduct an audit (Appendix 6), and also enters into an agreement for the provision of this type of service (Appendix 7).
The audit begins with the examination and assessment of the accounting system and internal controls for accounting for fixed assets based on tests (See Table 11).
Table 11.
Tests for checking the state of internal control systems and accounting of operations with fixed assets of Nord-Class LLC
No. Content of the question or object of study Content of the answer (result of the audit) Conclusions and decisions of the auditor A. Internal control1 Is there an authorized person responsible for the safety of documentation on fixed assets? Yes, the chapter is responsible for documentation on OS objects. accountant appointed by order The order meets the established requirements 2 Have conditions been created to ensure the safety of documents confirming the organization’s right to the OS object? The room is equipped with an alarm system, documents are stored in a safe. Proper storage conditions are ensured5 Are the necessary details in the documents completely filled out? Some documents are missing dates, have corrections, and duplicate numbers. Control risk is high. Pay attention to the execution of documents6 Is the circle of persons responsible for the safety of the object OS defined Yes Control risk is low 7 How does the organization ensure non-disclosure of trade secrets Are agreements concluded with employees on non-disclosure of trade secrets Control risk is low 8 Is a commission created for the acceptance of fixed assets no Control risk is high 9 Is an inventory of fixed assets carried out Yes, annually Control risk is low B. Accounting system10 Have schemes been developed for reflecting transactions with fixed assets in accounts? Only a working chart of accounts has been defined, there are no diagrams. It is possible that there may be errors in the correspondence of accounts. 11 Is there information on methods for valuing fixed assets that were not purchased for cash? No Control risk is high 12 Is information on the useful lives of fixed assets accepted by the organization disclosed (by individual groups) Yes, in orders for acceptance accounting for fixed assets It is possible that there may be errors when calculating depreciation 13 Is information disclosed on the methods of calculating depreciation charges for individual groups of fixed assets Yes, in the accounting policy Control risk is low 14 Is information disclosed on the methods of reflecting depreciation charges on fixed assets in accounting Yes, in the accounting policy Control risk is low 15 Is separate synthetic and analytical accounting in the organization Yes Control risk is low16 Are standard forms of analytical accounting of fixed assets used Yes Control risk is low17 Are all fixed assets objects reflected in analytical accounting Yes Control risk is low18 Is control over operations with fixed assets carried out by the organization's management No, control is carried out by the MOL and accounting Department Control risk is high19 Is the accelerated depreciation method used? individual fixed assets No20 Are all objects taken into account when calculating depreciation Yes Risk of control is low 21 Is the movement of fixed assets taken into account when calculating depreciation Yes Risk of control is low 22 Are there any cases of depreciation during reconstruction No Risk of control is low 23 Are estimates for major repairs of fixed assets drawn up correctly Yes Risk of control is low 24 Were it not allowed to add completed work for the purpose overestimation of consumption of spare parts and materials No Control risk is low
Calculation of the level of materiality and audit risk.
Federal Rule (Standard) No. 4 “Materiality in an Audit” establishes uniform requirements regarding the concept of materiality and its relationship with audit risk. During the audit process, the audit organization is obliged to assess materiality and its relationship with audit risk.
The level of materiality is understood as the maximum permissible size of error (distortion) in the reporting of the audited entity, which will not mislead the user of the reporting regarding the information of interest to him.
The materiality level is calculated as follows (See Table 12).
Table 12.
Calculation of the level of materiality
Name of the basic indicator Value of the basic indicator of the financial statements of the audited economic entity (thousand rubles) Share (%) Value used to find the level of materiality (thousand rubles) Balance sheet profit of the enterprise 2433551216.75 Gross sales volume excluding VAT 14000722800.14 Balance sheet currency 420732841.46 Own capital 246110246.10 Total enterprise costs 205752411.50
The procedure for calculating the level of materiality.
In column 2 we record the indicators taken from the financial statements of Nord-Class LLC. The indicators in column 3 must be determined by the internal instructions of the audit firm and applied on an ongoing basis.
Column 4 is obtained by multiplying the data in column 2 by the figure in column 3 divided by 100%.
The arithmetic mean of the indicators in column 4 is:
(1216.75 + 2800.14 + 841.46 + 246.1 + 411.5) / 5 = 1103.19 thousand rubles.
The smallest value differs from the average by:
(1103.19 - 246.10) / 1103.19 x 100 = 77.69%.
The largest value differs from the average by:
(1103.19 - 2800.14) / 1103.19 x 100 = 153.82%.
Since the value is 2800.14 thousand rubles. differs from the average by more than 246.10 thousand rubles. and, in addition, the second highest value is 411.5 thousand rubles. very close in value to 246.10 thousand rubles, we decide to discard it in further calculations highest value, and leave the smallest one. The new arithmetic mean will be:
(1216.75 + 841.46 + 246.1 + 411.5) / 5 = 543.16 thousand rubles.
It is permissible to round the resulting value to 545 thousand rubles. and use this quantitative indicator as the significance level value. The difference between the materiality level before and after rounding is:
(545 - 543.16) / 543.16 x 100 = 0.34%, which is within 20%.
Audit risk means the probability of not identifying significant errors in the event of a positive audit report and, conversely, in the event of a negative audit report, the client’s reporting does not have significant errors.
Audit risk includes intra-company risk (ICR), control risk (RC), and non-detection risk (RD). Let's imagine audit risk as the following model:
PAR = VCR * RK * RN, where
AAR - acceptable audit risk - expresses the measure of the auditor's willingness to accept the fact that the client's financial statements may contain material errors after the audit has already been completed and an audit opinion has been issued.
Water chemistry - expresses the existence of an error exceeding the permissible value before checking the internal control system.
RK - shows the probability that an existing error exceeding the permissible value will be neither prevented nor detected in the on-farm control system.
PH - means the probability that the audit procedures applied and the evidence to be collected will not detect errors exceeding the acceptable value.
The auditor assumes that the water and chemical chemistry is 80%, the rotary control is 50% and the pH is 10%. Then:
PAR = 0.8 * 0.5 * 0.1 = 0.04 or 4%
If the auditor concludes that the PAR should be no more than 4%, then he may consider the plan acceptable.
When calculating audit risk, it is advisable to monitor the controls used in Nord-Class LLC when accounting for intangible assets. Monitoring is carried out in two stages:
) general familiarity with controls and their initial assessment;
) confirmation of the reliability of the assessment of controls.
stage. General familiarization with control tools and an initial assessment of its reliability. At the beginning, you should get a general idea of the specifics and scale of the activities of an economic entity and the system of controls. Familiarization with the system of controls at the preliminary stage is carried out on the basis of an oral interview, review of the necessary documents, processing and evaluation of information about the parties to the economic activity of the economic entity being inspected. To assess the reliability of controls, the following gradation scale is used (See Table 13).
Table 13.
Scale for assessing the degree of reliability of the internal control system
IntervalReliability degreeLess than 60%LowFrom 60 to 80%Medium More than 80%High
The results of this review are presented in Table 14.
Table 14.
Introduction to Controls
Questions for testing the system of controlsAnswer: Is there a permanent inventory commission + Has a commission been created for the acceptance of fixed assets - Are there responsible persons responsible for the safety of fixed assets + Is control over the safety of fixed assets provided + Are there responsible persons responsible for maintaining accounting records of fixed assets -Are there responsible persons responsible for the document flow for accounting for the movement of fixed assets+Is the circle of persons with access to the use of fixed assets limited?
Conclusions from Table 14: after a general acquaintance with the system of controls over the accounting of intangible assets of Nord-Class LLC, we can say that the effectiveness and reliability of the system of controls is rated as average and amounts to: 5/7 × 100% = 71.43% .
stage. Confirmation of the assessment of significant elements of in-process control. The second stage of verification is a procedure for confirming the reliability of the assessment of funds identified in the previous stages. The procedure is carried out on the basis of the study, analysis and assessment of information about the following aspects of the economic activity of the inspected entity (See Table 15).
Table 15.
Assessment of essential elements of in-process control
Essential elements of internal production control ValueAnswer (+/-) Is the separation of functions for carrying out real commercial and financial and economic activities from the accounting function ensured? This approach ensures the objectivity and independence of accounting and creates the basis for real internal production control. + Is there a division of functions for accounting? Provides greater control over the correctness and timeliness of accounting transactions + Is the personal responsibility of each employee of the enterprise established? A clear distribution of responsibility will not only have an effect, but will also make it possible to determine the performance of each employee and monitor the fulfillment of the duties assigned to him -Is the circle of officials who have the right to sign documents determined? The number of persons who are given the right to sign documents should be limited + The use of unified forms of primary accounting documentation Improves the quality and level of accounting + Are there security measures? The likelihood of theft and loss of relevant documents is reduced with proper organization of security , use of alarm systems, installation of safes, restricting access to valuables and funds. +Are sudden inspections carried out? Business activities should be periodically monitored by the accounting service, audit commission, service internal audit, an independent audit organization, persons authorized by the board or directorate - Personnel qualifications The enterprise must organize systematic training of personnel in the rules for using fixed assets, the technique of compiling and processing primary accounting documentation in accordance with the provisions and requirements of the current economic legislation. -
Conclusions from Table 15: essential elements of in-process control of Nord-Class LLC are assessed as average and amount to: 5/8×100%=62.5% .
In general, for the enterprise it should be noted that the system of controls is average and amounts to (71.43 + 62.5) / 2 = 66.97%.
Based on these data and conclusions, the auditor should plan audit procedures, but should not trust this assessment absolutely.
Audit plan and program.
The general plan for an audit of fixed assets accounting is as follows:
?study the composition and structure of fixed assets according to primary documents and accounting registers;
?confirm ownership of fixed assets;
?checking the correctness of documentation of transactions with fixed assets;
?establish the correctness of recording transactions with fixed assets;
?confirm the accuracy of the accrual and recording of depreciation on fixed assets;
?assess the quality of inventory;
?checking the correctness of reporting information on fixed assets.
The organization being inspected is LLC Nord-Class.
Audit period - from 10/05/2010 to 10/15/2010.
Number of man-hours - 80.
Head of the audit team - Dmitriev D.A.
Composition of the audit team: Krylova T.V.
The planned audit risk is 4%.
Planned level of materiality:
) Qualitatively - compliance with regulations;
) Quantitatively - 565 thousand rubles.
The audit program is shown in Table 16.
Table 16.
Audit program for fixed asset accounting operations at Nord-Class LLC
No. List of proceduresSources of informationSelective control of fixed assets (FPE) a) check documents for ownership and correctness of classifying the object as Fixed Assets; Contracts, invoices, acceptance certificates, commissioning certificates, invoices, etc. Checking the data of fixed assets accounting registers and reconciling them with the General Ledger accounts. Inventory cards of fixed assets accounting, order journals, General Ledger. Preparation of the OS receipt list: a) confirm the presence and correctness of the relevant visas and details on the documents; b) check the correctness of determination and completeness of reflection in the accounting of the initial cost of fixed assets. Agreements, invoices, invoices, acceptance certificates, write-off acts, asset inventory cards, General Ledger. Checking the OS inventory data and comparing its results with accounting data. Inventory lists, OS inventory cards. Checking the correctness of allocation and refund of VAT on received fixed assets, accrual of VAT and other taxes on sales and other disposals Settlement and payment documents, tax calculations, acceptance and transfer acts, write-off acts Analysis of the correctness of depreciation calculation of fixed assets Accounting policies, depreciation statements Checking the correctness of attribution of depreciation charges to the appropriate accounts for cost accounting, etc. Sheets of distribution of depreciation charges. Calculation and reconciliation of analytical accounting data for accrued depreciation of fixed assets with account data in the General Ledger, Statements of accrual and distribution of depreciation charges, General Ledger. Checking the correct reflection of fixed assets in the reporting General ledger, financial statements
3.3 Conducting an audit of fixed assets - substantive procedures
Since Nord-Class LLC has more than 50 fixed assets on its balance sheet, it is advisable to carry out an audit in a selective manner. This decision was influenced by a number of factors:
?depreciation of fixed assets, especially the active part, is very high;
?The enterprise did not carry out sufficient revaluation; the enterprise's fixed assets were mainly taken into account in prices of 1998-2000.
?average age of fixed assets at the end of 2009 was 7 years.
When performing a random audit, the auditor must first divide the entire set of fixed assets into sub-populations (stratify) so that elements of all sub-populations can be selected for inspection with equal probability.
The totality of the organization's fixed assets was divided into subsets according to the following criteria:
stage: classification in reporting. If the reporting classifies fixed assets into several groups, for example, land plots, buildings and structures, machinery and equipment, it is necessary that the sample includes fixed assets reflected under each item. The auditor may decide not to check elements for any of the items in the classification of fixed assets if it is significantly less than the level of materiality and possible violations will not affect the reliability of the financial statements of the organization as a whole;
stage: classification by depreciation groups. If the organization's fixed assets are divided into several depreciation groups, the sample should include fixed assets from different depreciation groups.
3.4 Carrying out control procedures, substantive procedures and documenting them
Accounting at Nord-Class LLC is carried out in an automated form using the 1C: Enterprise 8 program according to the standard configuration version 5.4.
The cost of fixed assets is repaid through depreciation using the straight-line method. According to the accounting policy, the initial cost of fixed assets worth more than 20,000 rubles. per unit is repaid by depreciation. Fixed assets, the cost of which does not exceed 20,000 rubles. are written off in accounting as expenses at a time after commissioning.
Checking the availability of fixed assets and the correctness of their documentation.
Verification of the creation of a commission for acceptance of fixed assets.
During the inspection, no order to create a commission for acceptance of fixed assets was found. However, this commission is created as the fixed asset is received by the enterprise and its composition, as a rule, includes:
?Executive Director;
Ch. engineer;
Accountant.
The composition of this commission also depends on which structural unit of the enterprise the object will go to.
Next, the data in the fixed assets accounting registers is checked and reconciled with the General Ledger accounts, as well as the completeness and correctness of the disclosure of information on fixed assets in the reporting. Working document No. 1 is being compiled (Table 17).
Table 17.
Working Paper No. 1
Indicator name Balance at the beginning of 2009 Debit turnover Credit balance at the end of 2009 analysis of account 012035350.00250000.00158010.002127340.00 analysis of account 021534147.56158010.00101811.722127340, 00Data for the General Ledger: Account 012035350.00250000.00158010.002127340.00Account 021534147, 56158010.00101811.721590345.84 Residual value of fixed assets according to the auditor’s calculations 501202.44536944.16 Total according to line 010 of the Balance Sheet (form No. 1) 501--537 Deviations no no no no
A check of discrepancies between the data in the OS and General Ledger registers and the auditor’s calculations did not reveal any discrepancies. Data on fixed assets are fully reflected in the financial statements; information about intangible assets of LLC Nord-Class, Severomorsk, is disclosed correctly in the statements.
Verification of the correct execution of the purchase and sale agreement is reflected in working document No. 2 (Table 18).
Table 18.
Results of checking the execution of a purchase and sale agreement for fixed assets based on formal characteristics (working document No. 2)
No. Indicators Verification 1 Presence of original signatures + 2 Presence of original seals + 3 Presence of details of the contracting parties + 4 Presence of a mark of the body authorized to register rights +
Checking the sale and purchase agreements according to formal criteria showed that all details of the agreement were filled out in accordance with the requirements contained in the Civil Code of the Russian Federation.
Checking the availability of information and the completeness of its reflection in the acceptance and transfer certificates. On the day of acceptance, an act of acceptance and transfer of fixed assets (except for buildings and structures) (form No. OS-1) in one copy is issued to the enterprise’s balance sheet (Appendix 8.9). Checking the acceptance and transfer acts according to formal criteria is necessary in order to check the completeness of the information reflected in this document and to identify shortcomings in the design of unified forms of primary documentation. The results of this review are presented in Working Paper No. 3 (See Table 19).
Table 19.
Results of checking the completeness of information reflected in the transfer and acceptance certificate OS-1 (working document No. 3)
No. Contents Inspection result 1 name of the document + 2 date of preparation of the document + 3 name of the organization on behalf of which the document was drawn up + 4 content of the business transaction + 5 measures of the business transaction in physical and monetary terms + 6 Useful life + 7 Initial cost on the date of acceptance for accounting + 8 Method of calculating depreciation + 9names of positions of persons responsible for carrying out a business transaction and the correctness of its execution +10personal signatures of these persons and their transcripts+
Checking acts of acceptance and transfer of fixed assets based on formal characteristics revealed the following:
?All considered forms are fully filled out in terms of official information - all mandatory details are indicated in accordance with Resolution of the State Statistics Committee of Russia dated January 21, 2003 No. 7 “On approval of unified forms of primary accounting documentation for accounting of fixed assets.”
?All documents under consideration are drawn up in accordance with and on the basis of the Federal Law of November 21, 1996 No. 129 - Federal Law “On Accounting”. In accordance with which primary accounting documents are compiled in accordance with the form contained in the albums of unified forms of primary accounting documentation, and documents whose form is not provided for in these albums contain mandatory details.
?the act fully reflects all information on the objects included in the sample.
Fixed assets are received by the organization through their acquisition on the basis of sales contracts and invoices. We will check the correctness and completeness of the information reflected in them. The results are reflected in Working Paper No. 4 (See Table 20).
Table 20.
Results of checking invoices according to formal characteristics (working document No. 4)
No. Indicators Check 1 Sequence number and date of statement + 2 name, address and identification numbers of the taxpayer and buyer + 3 name and address of the consignor and consignee + 4 name of the goods supplied (shipped) (description of work performed, services rendered) and unit of measurement (if it is possible to indicate it) + 5quantity (volume) of goods (work, services) supplied (shipped) according to the invoice, based on the units of measurement accepted on it (if it is possible to indicate them) +6 price (tariff) per unit of measurement (if it is possible to indicate it) under the agreement (contract) ) excluding tax, and in the case of application of state regulated prices (tariffs) that include tax, taking into account the amount of tax + 7 cost of goods (work, services), property rights for the entire quantity of goods supplied (shipped) according to the invoice (performed works, services provided), transferred property rights without tax + 8 tax rate + 9 the amount of tax imposed on the buyer of goods (works, services), property rights, determined on the basis of the applicable tax rates + 10 cost of the total quantity of goods supplied (shipped) according to the invoice (work performed, services provided), transferred property rights, taking into account the amount of tax + 11 Signatures of the manager and chief accountant +
As a result of the inspection, it was revealed that all mandatory details in the delivery notes were filled out in accordance with the requirements of the Tax Code of the Russian Federation and the Civil Code of the Russian Federation.
Since Nord-Class LLC is a VAT payer, when purchasing fixed assets, according to the invoice, VAT is allocated, which, when the object is accepted for accounting, is deducted (reduces the taxable base for this tax). Therefore, it is necessary to check the correctness of VAT recording. Working document No. 5 is being drawn up (See Table 21).
Table 21.
We will check the reflection of value added tax in the invoice (working document No. 5)
Name of goods According to invoice data According to verification data Deviation Cost of goods, total without tax Amount of tax Cost of goods, total including tax Cost of goods, total without tax Amount of tax Cost of goods, total including tax Concrete mixer 40000,007200,0047200,0040000,007200,0047200,00-Hydraulic crane100000, 0018000, 00118000,00100000,0018000,00118000,00-Autonomous electric generator250000,0045000,00295000,00250000,0045000,00295000,00-Heat gun60000,0010800,00708 00,0060000,0010800,0070800,00-Car Gazelle377118,6467881,36445000,00377118,6467881 ,36445000,00-
According to the verification of the correctness of VAT reflection in the invoice, no violations were identified. All positions are reflected in accordance with the requirements of regulatory documents.
Checking the correctness of the formation of the value of fixed assets according to the methods of their acquisition.
A necessary condition The correct setup of accounting for fixed assets is uniformity in the system of their assessment. The principle of unity and reality of valuation of this type of property is the determining factor in organizing the accounting of fixed assets.
Of the fixed assets that were included in the audit sample in 2009, Nord-Class LLC purchased: an autonomous electric generator.
Both of these objects were purchased by the enterprise for a fee from the Suppliers, confirmation of this is the executed purchase and sale agreement. The initial cost is formed in the amount of actual costs reflected in the debit of account 08, which is indicated in the balance sheet for account 08 (Appendix 10).
According to the accounting policy of Nord-Class LLC, fixed assets are not revalued. During the inspection at this site, no violations of the requirements of regulatory documents were identified.
Checking the consistency of application of accounting policies in relation to fixed assets. Based on the results of this procedure, working document No. 6 is drawn up (See Table 22).
Table 22.
Analysis of the accounting policies of Nord-Class LLC (working document No. 6)
Accounting area Accounting object Approved version of the accounting policy Normative document Commentary Accounting for fixed assets Accrual of depreciation Linear method PBU 6/01 "Accounting for fixed assets" Formation of residual value upon disposal Chart of accounts and instructions for its use Necessary Accounting for the repair of fixed assets Reserves for the repair of fixed assets - do not create the Tax Code of the Russian Federation, Article 260; PBU 6/01 "Accounting for fixed assets" Procedure for revaluation of fixed assets Revaluation is not carried out PBU 6/01 "Accounting for fixed assets" Formation of the initial cost upon receipt of a fixed asset Under the initial cost of fixed assets received under contracts providing for the fulfillment of obligations (payment) not in cash, consider the value of values transferred or to be transferred by the organization. PBU 6/01 "Accounting for fixed assets" Procedure for conducting an inventory of fixed assets PBU 6/01 "Accounting for fixed assets" Required
The accounting policy of the company Nord-Class LLC meets the requirements contained in PBU 1/08 “Accounting Policy of the Organization”, completeness, timeliness, prudence, priority of content over form, consistency, rationality. Order "On the accounting policy of the enterprise" No. 278-osn dated December 30, 2008 approved the accounting policy for 2009.
It was formed by the chief accountant. This document discloses the accounting methods adopted during the formation of accounting policies. Significant methods of accounting are disclosed in the explanatory note included in the organization’s annual financial statements for the reporting year. Order No. 2789-osn dated December 30, 2009 “On the accounting policy of the enterprise” is accompanied by a working chart of accounts containing synthetic and analytical accounts that are necessary for maintaining accounting in accordance with the requirements established by law. An enterprise's business transactions in accounting are formalized using standard primary documents approved by law and forms that are developed by the enterprise independently.
From the data given in the table it is clear that the accounting policy of the enterprise does not reflect all elements of accounting for fixed assets that must be reflected in accordance with Accounting Regulations 6/01 “Accounting for fixed assets”. In accordance with Article 12 of the Federal Law “On Accounting”, in order to ensure the reliability of accounting data and financial statements, an enterprise is obliged to conduct an inventory of property and liabilities in order to verify and document their presence and condition, which is also not reflected in the accounting policy. Among the elements of the enterprise's accounting policy, the methods established in the organization for monitoring the performance of business transactions and the procedure for their registration by the enterprise's employees are not indicated.
Verification of compliance with the conditions necessary for accepting assets for accounting as fixed assets is carried out using the testing method. Working document No. 7 is being compiled (See Table 23).
Table 23.
Testing compliance with the conditions for accepting objects as fixed assets (working document No. 7)
Question No. Question Answer 1 Are products used in production when performing work or providing services or for the management needs of the organization? Yes2Used for long periods of time, i.e. useful life greater than 12 months or normal operating cycle if greater than 12 months? Yes3Does the organization intend to subsequently resell these assets? Yes4Is it capable of bringing economic benefits (income) to the organization in the future? Yes
When classifying objects as fixed assets in Nord-Class LLC (in particular, the Gazelle truck), the fulfillment of 4 mandatory conditions was ensured:
.The vehicle is designed to deliver materials to construction sites.
2.It is intended for use over a long period of time (useful life is set at 96 months), which exceeds 12 months.
.The company does not plan to resell this vehicle.
.In the future, this vehicle will bring economic benefits to the enterprise.
Audit of the movement of fixed assets.
Checking the correctness of recording the receipt of fixed assets.
Upon receipt of fixed assets, it is necessary to check the availability of a certificate of acceptance and transfer of fixed assets (form OS-1). When checking the order of receipt of fixed assets, it was found that all fixed assets of Nord-Class LLC were purchased for a fee. Upon receipt of fixed assets, the following documents were checked:
-act of acceptance and transfer of fixed assets;
-contract of sale;
-invoice and delivery note for the received fixed asset;
During the audit, it was discovered that in 2009 the company received the following fixed assets:
?autonomous electric generator.
Using analytical procedures, it was discovered that stone facing tools were also purchased in 2009.
To summarize information about the costs of Nard-Class LLC in objects that will be accepted for accounting as fixed assets, account 08 “Investments in non-current assets” is intended.
The following sub-accounts are opened on this account:
?08-3 "Construction of fixed assets"
?08-4 "Acquisition of individual fixed assets."
The balance sheet for the debit of account 08 “Investments in non-current assets” reflects the actual costs included in the initial cost of acquired fixed assets. Acceptance of fixed assets for accounting is reflected in the debit of account 01 “Fixed assets” in correspondence with account 08 “Investments in non-current assets”.
The amounts on the credit of account 08 in the analysis of account 08 coincide with the amount reflected on the debit of account 01 in the analysis of account 01 (working document No. 8, Table 24).
Table 24.
Checking the original cost of fixed assets (working document No. 8)
Name of object Costs of acquisition of objects Deviation According to documents Reflected on account 08 According to accounting data. accountingAccording to inspectionGazelle car377118.64377118.64377118.64-Trolley50000.0050000.0050000.00-Concrete mixer200000.00200000.00200000.00-Crane315000.00315000.00 315000.00-Hydraulic crane100000.00100000.00100000.00-
Based on the results of checking the timeliness of capitalization of fixed assets, working document No. 9 is drawn up (See Table 25).
Table 25.
Checking the timeliness of capitalization of fixed assets (working document No. 9)
Name of the fixed asset objectDate of the invoiceDate of drawing up the acceptance and transfer certificate of fixed assetsDate of capitalization of fixed assets in the accounting registers. accounting Deviations (+,-) Autonomous electric generator 03/19/200903/19/200903/19/2009-Trolley07/20/200607/20/200607/20/2006-Concrete mixer01/26/200701/26/200701/26/2007-Crane3 0.07.200830.07.200830.07.2008-Gazelle car15.02.200715.02.200715.02.2007-
This verification procedure did not reveal any deviations. All objects are accepted as fixed assets in a timely manner and in full.
Checking the correct write-off of fixed assets.
The primary document for writing off property from the balance sheet is the act of writing off fixed assets (form No. OS-4) or the act of writing off motor vehicles (form No. OS-4a).
During 2009, there were no write-offs of fixed assets due to reasons of unsuitability for further operation.
For objects subject to write-off, acts for write-off of fixed assets are drawn up. In the balance sheet for account 01 “Fixed Assets,” the debit reflects the amount of write-off of the original cost of fixed assets, and the credit of this account reflects the amount of written-off depreciation. The amounts reflected in the credit of account 01 “Fixed assets” in the account analysis coincide with the data in the analysis of account 02 “Depreciation of fixed assets”.
In the act on the write-off of motor vehicles (form OS-4a), the costs of write-off, as well as the cost received from dismantling, are not reflected in section 5 "Information on the costs associated with the write-off of motor vehicles from accounting, and on receipt material assets from their write-off." Data from the write-off results is recorded in the inventory card. The residual value in all cases is written off to account 91 "Profits and losses" subaccount "Other expenses". As a rule, the property being written off is fully depreciated, so it has no residual value.
We will conduct a test for compliance with the correctness of reflection in the accounting of operations on the movement of fixed assets - working document No. 10 (See Table 26).
Table 26.
Test for compliance with the correct reflection in the accounting of operations on the movement of fixed assets (working document No. 10)
No. Contents Answer 1 Are all transactions involving the receipt of fixed assets reflected in account 08 “Investments in non-current assets”? Yes2 Is the formation of the initial value ensured on account 08 “Investments in non-current assets”? Yes3Is account 07 “Equipment for installation” used to reflect transactions? No4 Is there a generalization of information on the availability and movement of fixed assets in operation on account 01? Yes5 Is depreciation reflected in account 02? Yes
This verification procedure did not reveal any violations.
Checking the reporting of the movement of fixed assets.
In the balance sheet (form No. 1), fixed assets are shown at their residual value (line 120).
Nord-Class LLC uses automated system accounting. Therefore, it is advisable to check the entries in the statements of debit and credit turnover in accounts 01 “Fixed Assets” (final balance on the turnover balance sheet according to account 01) and 02 “Depreciation of fixed assets” (final balance on the turnover balance sheet on account 02) . The residual value of fixed assets indicated in the balance sheet is equal to the difference between the original cost recorded on account 01 “Fixed assets” and the amount of depreciation accumulated on account 02 “Depreciation of fixed assets”.
Since the company does not carry out revaluation of fixed assets, the result of the revaluation of fixed assets is not given in Section I “change in capital” of form No. 3 “Report on changes in capital”.
More complete information about fixed assets is given in Form No. 5 “Appendix to the Balance Sheet”. In relation to the classification of fixed assets by their groups, the section “Fixed Assets” discloses information about their availability and movement in the reporting year. Fixed assets are shown at historical cost. This form also provides information at the beginning and end of the reporting period on the amount of accrued depreciation.
The section "Expenses for ordinary activities (by cost elements)" shows the amount of depreciation as an element of production costs. The inspection is documented in working document No. 11 (See Table 27).
Table 27.
Checking the movement of fixed assets (working document No. 11)
Name According to form No. 5 According to the auditor Deviation At the beginning of the reporting year, thousand rubles. At the end of the reporting year, thousand rubles At the beginning of the reporting year, thousand rubles At the end of the reporting year, thousand rubles Buildings---Structures and transmission devices---Machinery and equipment1534118,001784118,001156999,361406999,36+377118,64Vehicles-377118,64377118,64-377118,64Industrial and household. inventory 447450.00289440.00447450.00289440.00 Other types of fixed assets 53782.0053782.0053782.0053782.00 Land plots and natural resources - Total 2035350.002127340.002035350.00 2127340.00
As a result of checking the data on the initial cost of fixed assets and the amount of accumulated depreciation according to Form No. 5 and the auditor’s calculations, deviations were identified:
?The Gazelle car is reflected in form No. 5 under the line “machinery and equipment”, while it should have been reflected under the line “Vehicles”. It is recommended to take this comment into account when preparing reports for 2010, as well as provide explanations and clarifications on this fact to the Federal Tax Service for the city of Murmansk.
In general, in the appendix to the balance sheet, the amounts of incoming and outgoing fixed assets are also reflected correctly. These amounts coincide with the data given in the analysis of accounts 01 and 02. The amounts of accrued depreciation for the reporting period, reflected in the Appendix to the balance sheet by group, coincide with the auditor's data.
All indicators regarding fixed assets reflected in the financial statements are interrelated, as presented in working document No. 12 (See Table 28).
Table 28.
Interrelation of indicators of reporting forms (working document No. 12)
Relationships Meaning Relationship between indicators F. No. 1 and f. No. 5 Form No. 1 Form No. 5 Line 120 Column 3 Fixed assets (column 3) minus depreciation of fixed assets (column 3) Present At the beginning of the year, thousand rubles. 501 At the end of the year: 2035-1534 = 501 Line 120 Column 4 Fixed assets (column 6) minus depreciation of fixed assets (column 4) Present At the beginning of the year, thousand rubles. 537At the end of the year: 2127-1590=537
Audit of depreciation.
Validation of useful life determination
The useful life of fixed assets is determined on the basis of the Classification of fixed assets included in depreciation groups, approved by Decree of the Government of the Russian Federation of January 1, 2002 No. 1. So, according to this classification, the Gazelle car purchased by the company is assigned to depreciation group 5:
Object name OKOF Name for classification Gazelle car 15 3410270 Medium and large buses up to 12 m long inclusive
?Depreciable property is distributed among depreciation groups in accordance with its useful life.
The Gazelle car, according to the inventory card, has a useful life of 96 months or 8 years and belongs to depreciation group 5 (Appendix 11).
Checking the correctness of monthly depreciation on fixed assets for accounting purposes.
Depreciation of fixed assets at Nord-Class LLC for accounting purposes is carried out by calculating depreciation charges using the straight-line method. Essence linear method is that the repayment of the initial assessment of an object is determined by its service life, regardless of the efficiency of its use. A feature of this method is a uniform increase in accumulated wear over the years of service. The same tendency, but of the opposite nature, is characteristic of the residual value of the object, which decreases evenly until it reaches the liquidation value. Depreciation is calculated within a group of similar objects over the entire useful life. In synthetic accounting, depreciation is reflected in passive account 02 “Depreciation of fixed assets.” The amount of depreciation accrued for the reporting period is reflected in the balance sheet for account 02.
Hydraulic crane, inv. No. 1010645874 was transferred for paid use - rent to another organization. Therefore, depreciation is calculated by assigning its amount not to cost accounts, but to other expenses:
D 91 K02 - 9064.32 rub. - monthly depreciation amount calculated
The audit showed that depreciation on fixed assets newly put into operation is correctly calculated from the first day of the month following the month of their commissioning.
The autonomous steam generator was taken into account on 03/18/09. Therefore, depreciation began on 04/01/09. The fixed assets report for the first quarter of 2009 shows only its book value without depreciation, since depreciation began in the second quarter. The fixed assets report for 2009 shows the book value of the object and the amount of accumulated depreciation for 9 months.
Based on the results of the inspection, working document No. 13 is drawn up (See Table 29).
Table 29.
Sheet for checking the correctness of accrual of depreciation of fixed assets (working document No. 13)
Fixed asset asset Amount of depreciation per month Deviations (+,-) According to the depreciation statement According to the auditor's calculations Book value Useful life, months Amount of depreciation per place 50,000.001 20416.67416.67 - Lifting crane 315,000.001 202625.002625.00 - Hydraulic crane 100 000.00120833.33833 ,33-Concrete mixer 200,000.001201666.671666.67-Gazelle car 377118.64963928.323928.32-
This verification procedure did not reveal any violations.
Accrual of depreciation on retired fixed assets ceases from the first day of the month following the month of disposal. For fully depreciated fixed assets, depreciation ceases from the first day of the month following the last month in which the cost of these assets is fully transferred to the cost of work, which is also reflected in the report on fixed assets.
The final procedure is to check the correctness of the transactions reflected in the movement of fixed assets in the accounting accounts. Based on the results of this procedure, working document No. 14 is drawn up (See Table 30).
Table 30.
Working Paper No. 14
OperationReflection in accounting according to the organizationReflection in accounting according to the auditorRemarksDebitCreditDebitCreditPurchased fixed asset item08600860NoReflected delivery costs08760860.76NoRecorded installation and installation costs08760860.76NoReflected consulting services08760860.76NoAccepted the object for accounting as a fixed asset0108 0108 No Depreciation accrued 20,23,25,26,44,910220 ,23,26,44,9102NoReflected expenses for repairs of fixed assets20,25,26,44,9110,60,7620,25,26,44,9110,60,76NoReflected disposal of fixed assets02010201No91019101No
3.5 Information from the auditor to the management of Nord-Class LLC based on the results of the audit
Nord-Class LLC is a construction organization, so it is characterized by the presence of a large number of specialized fixed assets.
However, as of January 1, 2010. the share of fixed assets in the total balance sheet currency amounted to 1.28%. This is due to the high proportion of depreciation of fixed assets - 74.75% as of the same date.
Since accounting for fixed assets is a form of reporting, it is strategically important for the Nord-Class LLC enterprise to use them effectively, so that this is noticeable after a short period of time, for example, a year.
To effectively use existing fixed assets at the Nord-Class LLC enterprise, it is necessary to carry out the following activities:
.When conducting an audit, pay attention to the presence, safety and integrity of all inventory items classified as fixed assets;
2.Monitor the rate of depreciation of fixed assets, find and eliminate the consequences of their improper use;
.Introduce new ways of working with fixed assets based on reducing costs and overall costs of the enterprise;
.Calculate the efficiency of use of fixed assets based on the total profitability indicators for the current period, taking into account the useful life of fixed assets;
.Conduct regular technical inspections of the OS (it is advisable to conduct them before the start of the audit);
.Regularly reassess the value of fixed assets.
Carrying out these activities at the Nord-Class LLC enterprise is necessary due to the fact that:
?In the context of the global financial crisis, the Nord-Class LLC enterprise is interested in minimizing costs, which can be achieved by adequately assessing the existing operating systems and preventing their “bloat.” Getting rid of unnecessary operating systems will allow you to reduce the company’s expenses (including the organization’s property tax) and introduce these funds, for example, into a sales promotion program
?the use of the income and cost method when assessing OS at the Nord-Class LLC enterprise will make it possible to create a comprehensive document that allows managers to see not only the level of income coverage with expenses, but also the cost of all items, which will allow them to adequately assess the availability of a specific OS for a given enterprise in conditions of limited funds. In addition, they are quite easy to use, so calculating indicators will not take much time, saving it for analyzing the situation and making decisions right decisions
?application of new effective methods using the OS will improve the qualifications of personnel and thus increase the volume of production and sales at the Nord-Class LLC enterprise.
Thus, we can conclude that the accounting of fixed assets at Nord-Class LLC is maintained in accordance with the law and does not contain any errors or violations. In connection with the audit of only one area of accounting, namely fixed assets, an audit report will be issued on a special audit assignment (Appendix 12).
Conclusion
Russia's transition to market relations revealed the need to create new independent economic institutions capable of giving an objective assessment of the reliability of the data contained in accounting and reporting. In this regard, in Russia for last years Some work has been done to establish an auditing institute. Regulatory documents have been approved to regulate auditing activities in the Russian Federation, the procedure for certification for the right to carry out auditing activities and the procedure for issuing licenses for auditing activities have been determined, and the entities that must be subject to mandatory audit have been identified.
The audit can be carried out both in all areas of accounting and in its individual areas. In particular, the audit of fixed assets is very relevant.
The main purpose of an audit of fixed assets is to check the correctness of the formation of the composition, completeness and reality of accounting for fixed assets and the reliability of depreciation of their cost.
The main objectives of accounting for fixed assets are the correct documentation and timely reflection in the accounting registers of the receipt of fixed assets, their internal movement and disposal; correct calculation and recording of the amount of depreciation of fixed assets; accurate determination of the results of liquidation of fixed assets; control over the costs of repairing fixed assets, their safety and efficient use.
During the audit of Nord-Class LLC, key issues of the audit of fixed assets were considered.
As a result of the audit, no facts were found from which it could be concluded that the internal control system of the enterprise in question did not correspond to the scale and nature of its activities. Responsibility for the organization and state of internal control lies with the Chairman of the PC and Chief Accountant.
Also, no serious violations of the established accounting procedures were found that could significantly affect the reliability of the data on fixed assets reflected in the financial statements. During the audit, issues of the availability of fixed assets, their movement and depreciation were considered.
When checking the availability of fixed assets and the correctness of their documentation, no order was found to create a commission for the acceptance of fixed assets, which is mandatory. When analyzing the sequence of application of accounting policies in relation to fixed assets, some not all elements were reflected, which is required by BU 6/01. This may lead to errors when recording fixed assets in accounting.
When checking the reporting of the movement of fixed assets, the audit was planned and carried out in such a way as to obtain sufficient confidence that the financial statements regarding fixed assets do not contain material misstatements. The audit included checking, on a sample basis, confirmations of the numerical data contained in the financial statements of the enterprise, namely in forms No. 1 “Balance Sheet” and No. 5 “Appendix to the Balance Sheet”.
As a result of the audit, no cases of discrepancies in entries in the balance sheets, account analyzes and primary documents were found, which gives grounds to express an opinion on the reliability of the accounting statements regarding fixed assets.
In this work, the following tasks were solved:
?revealed the methodological basis of the audit of fixed assets;
?determined the goals, objectives and methodology for conducting an audit of fixed assets;
?carried out procedures for planning an audit of fixed assets: drafted letters of commitment and contracts for the provision of audit services; acquainted with the activities of Nord-Class LLC; studied and assessed the accounting and internal control systems for fixed assets; calculated the level of materiality and audit risk; reviewed the audit plan and program;
?carried out an audit of operations on the movement of fixed assets: control procedures and substantive procedures and their documentation;
?Based on the results of the audit, they gave a written opinion and recommendations for improving the accounting and use of fixed assets.
Solving these problems made it possible to realize the main goal of the work - we conducted an audit of fixed assets accounting using the example of the company Nord-Class LLC.
Regulatory acts
1.Civil Code of the Russian Federation. Part four dated December 18, 2006 No. 230-FZ / Reference and legal system "Consultant-Plus".
2.Accounting Regulations "Accounting for Fixed Assets" 6/01. Approved by order of the Ministry of Finance of the Russian Federation dated March 30, 2001 No. 26n / Reference and legal system "Consultant-Plus".
.Regulations on accounting and financial reporting in the Russian Federation. Approved by order of the Ministry of Finance of the Russian Federation dated July 29, 1998 N 34n / Reference and legal system "Consultant-Plus".
4.Tax Code of the Russian Federation. Part two dated 05.08.2000 No. 117-FZ / Reference and legal system "Consultant-Plus".
5.Federal Law No. 121-FZ of July 22, 2008 “On Amendments to Article 218 of Part Two of the Tax Code of the Russian Federation.”
6.Federal Law of December 30, 2008 No. 307-FZ “On Auditing Activities” / Legal reference system “Consultant-Plus”.
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Tags: Conducting an audit of fixed assets accounting using the example of the company LLC Nord-Class Diploma Accounting, management accounting
Introduction. 3
1 The importance of auditing the reliability of accounting indicators. 5
(financial) reporting. 5
1.1 The concept of audit. 5
1.2 Federal law and rules (standards) on auditing 7
1.3 Goals and objectives of the audit of accounting (financial) statements. 8
1.4 Composition of accounting (financial) statements. 14
1.5 Audit of the reliability of financial statements. 15
1.6 Analysis of the results of the audit of accounting (financial) statements. 22
1.7 Responsibility of the parties in relation to financial statements. 26
1.8 Result of the audit of financial statements. 27
2 The procedure for conducting an audit using the example of GrandService LLC, Novokuznetsk. 31
2.1 Basic elements of accounting policies. 31
2.2 Accounting for depreciable property. 32
2.3 Accounting for materials and goods. 33
2.4 Accounting for special clothing... 36
2.5 Accounting for fixed capital. 36
2.6 Accounting for labor costs. 37
2.7 Auditor's report. 38
Conclusion. 41
List of sources used. 43
Introduction
In market conditions, enterprises, credit institutions, and other business entities enter into contractual relations for the use of property, funds, commercial transactions and investments. The trust of this relationship must be reinforced by the ability for all parties to the transactions to obtain and use financial information. The reliability of the information is confirmed by an independent auditor.
Owners, and, above all, collective owners - shareholders, shareholders, as well as creditors, are deprived of the opportunity to independently verify that all the numerous operations of the enterprise, often very complex, are legal and correctly reflected in the reporting, since they usually do not have access to accounts , nor relevant experience, and therefore require the services of auditors.
Independent confirmation of information about the performance of enterprises and their compliance with the law is necessary for the state to make decisions in the field of economics and taxation.
Audits are required government agencies, courts, prosecutors and investigators to confirm the reliability of the financial statements they are interested in.
The need for auditor services arose due to the following circumstances:
¾ the possibility of biased information from the administration in cases of conflict with users of this information (owners, investors, creditors);
¾ dependence of the consequences of decisions made;
¾ the need for special knowledge to verify information;
¾ users often lack access information to assess its quality.
All these prerequisites have led to the emergence of a public need for the services of independent experts who have the appropriate training, qualifications, experience and permission to provide such services. Auditing activities (audit services) - activities related to conducting an audit and providing services related to the audit, carried out by audit organizations and individual auditors.
The presence of reliable information makes it possible to increase the efficiency of the capital market and makes it possible to evaluate and predict the consequences of various economic decisions.
The purpose of the course work is to conduct an audit of accounting (financial) statements using the example of GrandService LLC.
The main objectives of the work can be formulated as follows:
¾ reveal the theoretical and methodological foundations of auditing;
¾ explore the features of accounting;
¾ analyze the performance indicators of the enterprise and production efficiency, the financial condition of the enterprise;
¾ determine the correctness of drawing up annual reporting forms and identify shortcomings.
The sources of information for the study are the financial statements of GrandService LLC for 2009:
¾ Form 1 Balance Sheet;
¾ Form 2 Profit and Loss Statement;
¾ Form 3 Capital Statement;
¾ Form 4 Cash Flow Statement;
¾ Form 5 Appendix to the balance sheet;
¾ general ledger for 2009, balance sheets for accounts, order journals, etc.
1.1 Concept of audit
An audit is an independent verification of the accounting (financial) statements of the audited entity in order to express an opinion on the reliability of such statements. Under the accounting (financial) statements of the year N 129-FZ “On Accounting” or regulatory legal acts issued in accordance with it, as well as reporting similar in composition provided for by other federal laws or regulatory legal acts issued in accordance with them.
The need for auditor services arose in connection with the isolation of the interests of those directly involved in the management of the enterprise, as well as the state as a consumer of information about the results of enterprise activities. To attract financial investments, an economic entity must be successful, and its accounting (financial) statements must inspire confidence among potential investors and creditors.
In the Russian Federation, there are two forms of audit: mandatory and initiative.
Mandatory audit is carried out in the following cases:
a) if the organization’s securities are admitted to trading at stock exchanges and (or) other organizers of trading on the market valuable papers;
b) if the organization is a credit institution, the bureau credit histories, an organization that is a professional participant in the securities market, an insurance organization, a clearing organization, a mutual insurance company, a commodity, currency or stock exchange, a non-state pension or other fund, a joint-stock investment fund, management company joint stock investment fund, mutual investment fund or non-state pension fund (with the exception of state extra-budgetary funds);
c) if the volume of revenue from the sale of products (sale of goods, performance of work, provision of services) of the organization (except for bodies state power, local governments, state and municipal institutions, state and municipal unitary enterprises, agricultural cooperatives, unions of these cooperatives) for the previous reporting year exceeds 400 million rubles or the amount of assets balance sheet at the end of the previous reporting year exceeds 60 million rubles;
d) if an organization (with the exception of a government body, local government body, state extra-budgetary fund, as well as state and municipal institutions) submits and (or) publishes consolidated accounting (financial) statements;
e) in other cases established by federal laws.
An initiative audit is an audit of any area of an organization’s activity, carried out at the own request of the organization or individual entrepreneur on the basis of an agreement concluded with the auditor, i.e. carried out by decision of the management of the organization or the founders of the enterprise, as well as the business partners of the enterprise (potential investors, banks, etc.). An initiative audit is also commonly called “voluntary”, since the scope and nature of the audit is determined by the customer himself.
An audit can be carried out in relation to any legal entities, regardless of their organizational and legal forms and types of activities, as well as any individuals engaged in business activities without forming a legal entity and registered as individual entrepreneurs.
1.2 Federal law and rules (standards) on auditing activities
The main document on auditing activities is the Federal Law of December 30, 2008. No. 307-FZ (as amended on December 28, 2010). This Federal Law defines the legal basis for regulating auditing activities in the Russian Federation. For the purposes of this Federal Law, the accounting (financial) statements of the audited entity mean the statements provided for by the Federal Law of November 21, 1996 No. 129-FZ “On Accounting” (as amended on September 28, 2010), as well as statements similar in composition provided for other federal laws.
The law includes articles that reflect the basic concepts and aspects of auditing activities, related audit services, define the rights and responsibilities of audit organizations and individual auditors, as well as the rights and responsibilities of audited persons and/or persons who have entered into an agreement for the provision of audit services.
In accordance with Article 7 of this law, the rules (standards) of auditing activities contain uniform requirements for the procedure for carrying out auditing activities, design and assessment of the quality of audits and related services, as well as for the procedure for training auditors and assessing their qualifications. The rules (standards) determine the requirements for the procedure for carrying out audit activities, and also regulate other issues provided for by this Federal Law. They are developed in accordance with international auditing standards and are mandatory for audit organizations, individual auditors, as well as self-regulatory organizations of auditors and their employees.
It must be said that domestic audit rules (standards) acquired official status only recently, after the Federal Law of August 7, 2001 No. 119-FZ “On Auditing Activities” came into force. Until this moment, their use was not regulated by any legislative acts; they were not even mentioned in the text of the Temporary Rules on Auditing Activities. By Decree of the Government of the Russian Federation of September 23, 2002 No. 696 (with subsequent amendments and additions) approved federal regulations(standards) of auditing activities (as amended by Resolutions of the Government of the Russian Federation dated July 4, 2003 No. 405, dated October 7, 2004 No. 532, dated April 16, 2005 No. 228, dated August 25, 2006 No. 523, dated July 22, 2008 No. 557, dated November 19. 2008 No. 863 dated 02.08.2010 No. 586).
The emergence of the first Federal Law on Auditing in Russian history, naturally, immediately affected the status of auditing standards.
Mastering these standards is not an easy task and requires auditors, in some cases, to have extraordinary abilities in order to understand and apply them in practice. Many auditors still experience difficulties in developing methods for constructing an audit sample, because knowledge is required not only in the field of auditing, but also knowledge in such areas as mathematical statistics and probability theory.
Practice shows that many auditing issues that are not reflected in the federal rules (standards) of auditing are elements of the own (internal) standards of audit organizations and/or professional audit associations of which they are members.
1.3 Goals and objectives of the audit of accounting (financial) statements
An audit of accounting (financial) statements is understood as an independent verification carried out by an audit organization and resulting in the expression of the audit organization’s opinion on the degree of reliability of the accounting (financial) statements of an economic entity.
At the macroeconomic level, audit acts as an element of market infrastructure, the need for its functioning is determined by the following circumstances:
¾ accounting (financial) statements are used to make decisions by interested users, including management, participants and property owners of an economic entity, real and potential investors, employees, lenders, suppliers and contractors, buyers and customers, authorities and the public in general;
¾ accounting (financial) statements may be subject to distortion due to a number of factors, in particular the use of estimated values and the possibility of ambiguous interpretation of the facts of economic life; in addition, the reliability of accounting (financial) statements is not automatically ensured due to the possible bias of its compilers;
¾ the degree of reliability of accounting (financial) statements, as a rule, cannot be independently assessed by the majority of interested users due to the difficulty of access to accounting and other information, as well as the large number and complexity of business transactions reflected in the accounting (financial) statements of economic entities.
The objectives of the audit of accounting (financial) statements are the formation and expression of the audit organization’s opinion on the reliability of the accounting (financial) statements of an economic entity in all material respects.
During the audit of the accounting (financial) statements, sufficient and relevant audit evidence must be obtained to enable the audit organization to draw conclusions with reasonable confidence regarding:
¾ compliance of the accounting (financial) accounting of an economic entity with the documents and requirements of regulations governing the procedure for maintaining accounting (financial) accounting and preparing financial statements in the Russian Federation;
¾ compliance of the accounting (financial) statements of an economic entity with the information available to the audit organization about the activities of the economic entity.
The audit organization's opinion on the reliability of accounting (financial) statements can contribute to greater confidence in these statements on the part of users interested in information about an economic entity.
At the same time, users of accounting (financial) statements should not interpret the opinion of the audit organization as a complete guarantee of the future viability of an economic entity or the effectiveness of its management.
An audit report containing the audit organization’s opinion on the degree of reliability of the accounting (financial) statements should not be interpreted as a guarantee by the audit organization that there are no other circumstances (other than those set out in the auditor’s report) that affect or may affect the accounting (financial) statements. ) reporting of an economic entity.
The objectives of the audit of accounting (financial) statements are:
¾ formulation of the basic requirements for taking into account regulatory documents during the inspection;
¾ determination of the auditor’s actions when identifying facts of violations by the audited economic entity of the requirements of regulatory documents;
¾ reflection in the auditor’s working documentation of facts of violations of the requirements of regulatory documents.
When conducting an audit of accounting (financial) statements, the auditor is obliged to establish compliance of the financial or business operations of an economic entity with the regulations in force in the Russian Federation. The auditor checks the compliance of financial and business transactions performed by an economic entity with the applicable legislation solely in order to obtain sufficient confidence that the accounting (financial) statements do not contain significant distortions. The purpose of the audit is not to express an opinion on the full compliance of the activities of an economic entity with the applicable legislation.
Violations identified by the auditor may affect:
¾ significantly on the amount of indicators in the accounting (financial) statements;
¾ is insignificant on the value of the accounting (financial) reporting indicators, but can cause damage to the economic entity, its participants, the state or third parties.
In the event of an ambiguous interpretation of regulatory documents by the audit organization and the audited economic entity, the auditor should assess the significance of the impact of the controversial regulatory document on the assessment of the reliability of the reporting as a whole in accordance with the rule (standard) of auditing activities.
If the impact of a controversial regulatory document is significant, the auditor may, in agreement with the economic entity, take one or more of the following actions:
¾ send a written request on your behalf to the body that is the source of the controversial regulatory document, if there is no time limit for receiving a response to the request;
¾ warn in writing the management of the audited economic entity about the impossibility of issuing an unconditionally positive audit report.
If the impact of a controversial regulatory document is insignificant, then the fact of disagreement can be noted in the auditor’s written information to the management of the economic entity based on the results of the audit.
Checking by the auditor the compliance of the activities of an economic entity with the requirements of regulations:
1. When planning an audit, the auditor must, based on the characteristics of the economic entity being audited, determine the legal requirements that the activities of this entity must satisfy, as well as obtain a reliable idea of the extent to which the economic entity fulfills these requirements.
2. The auditor must pay special attention to such regulations, failure to comply with which may cause the termination or suspension of the activities of an economic entity. In this regard, the auditor needs to:
a) study the available information and regulatory framework relating to the economic entity;
b) obtain from the managers of an economic entity information about the techniques and methods used by it to ensure compliance with the requirements of regulations;
c) discuss controversial issues, ambiguously resolved in regulations, which are significant for assessing the results of the audit, with the management of the economic entity;
d) check the availability of documents on registration of an economic entity, necessary licenses and other documents, without which the inspected economic entity has no right to carry out economic and financial activities.
3. As in other matters, in terms of verifying compliance by an economic entity with the requirements of regulations, the auditor must plan and conduct the audit with a sufficient degree of professional skepticism.
4. The auditor must keep in mind that when conducting audits there is a risk of non-detection, despite the fact that the audit is well planned and professionally carried out in accordance with the requirements of the rules (standards) of auditing. The likelihood of this risk increases significantly if the following factors are present:
a) a significant number of regulations that are directly related to the audited economic entity, but are not taken into account and (or) not used by it in the accounting and internal control systems;
b) limitations of accounting and internal control systems that cannot reflect all economic and financial activities of an economic entity;
c) low qualifications of personnel involved in organizing accounting and internal control systems for an economic entity;
d) the auditor receives most of the information from the economic entity, which is not objective (evidential), but informative.
5. When ascertaining by the auditor whether an economic entity complies with the requirements of regulations, the auditor, if necessary, can use during the audit experts who have legal and other special knowledge in areas not related to the professional competence of the auditor. In this case, it is necessary to be guided by the rule (standard) of auditing activities “Use of an expert’s work.”
6. The auditor must ensure that the management of an economic entity takes measures to identify, prevent and eliminate violations of the requirements of regulations that may distort the accounting (financial) statements of the economic entity.
When checking the compliance by an economic entity with the provisions of legislative and other regulations, without compliance with which it is impossible to assess the reliability of the accounting (financial) statements of the economic entity, the goal is to establish requirements for an audit firm or an auditor working independently as an individual entrepreneur.
1.4 Composition of accounting (financial) statements
1.5 Audit of the reliability of financial statements
Data from Form No. 1 are submitted in compliance with the following requirements:
intangible assets and fixed assets are shown in net valuation, i.e. at residual value minus accrued depreciation;
construction in progress, purchased equipment requiring installation, are reflected at actual costs for the developer, as well as taking into account advances issued to the contractor for capital construction;
inventories (raw materials, main and auxiliary materials, fuel, components and spare parts, containers and others) are reflected at a cost determined from the cost of inventory valuation; inventories that are obsolete or the current market value of which has decreased are reflected at the end of the reporting year minus the reserve for reduction in the value of material assets;
finished products are reflected at actual or standard production costs;
goods occupied trading activities, are reflected at the cost of their acquisition;
shipped products or goods are reflected at actual or standard production costs;
accounts receivable for which provisions for doubtful debts have been created are shown minus the formed reserve;
receivables and payables are presented depending on the maturity date: short-term, if the maturity period is no more than 12 months, and long-term, if the maturity period is more than 12 months after the reporting date;
It is not allowed to provide information on settlement accounts in a “collapsed” form; data on these accounts is provided in an expanded form;
the authorized capital is shown in the amount in accordance with the constituent documents registered in the prescribed manner;
Loans and credits are shown taking into account interest payable at the end of the reporting period.
Data is also verified to identify any errors. The check is carried out as follows: the results of the balance sheets for analytical accounts are compared with the data of the corresponding synthetic account in the balance sheet for synthetic accounts. Equality of balances and turnover indicates the correctness of the entries in the accounting accounts. Data from Form No. 1 are used to analyze the property and financial position of the organization.
The profit and loss statement (Form No. 2) is the main reporting form and characterizes the procedure for generating the financial result of the financial and economic activities of the organization. The financial result in the income statement is defined as the difference between the balance of income and expenses of the reporting period on an accrual basis from the beginning of the year to the reporting date, taking into account that in accounting the financial result of business activity is determined by counting and balancing all profits and all losses for the reporting period period. For this, account 99 “Profits and losses” is used. The balance on this account reflects the financial result of business activities on a cumulative basis in account 99 “Profits and losses” on an accrual basis from the beginning of the reporting year.
The main purpose of the profit and loss statement (form No. 2) is to characterize the financial results of the organization for the reporting period. At the same time, the composition of such indicators as gross profit, profit (loss) from sales, profit (loss) before tax, profit (loss) from ordinary activities, net profit (retained earnings, uncovered loss) has been expanded. Income statement data is used to analyze financial performance.
When conducting an audit, it is necessary to check whether the requirements of regulations are met when generating the indicators of the “Report on Changes in Capital”. Explanations to the balance sheet and profit and loss statement must disclose additional data on changes in the capital (authorized, reserve, additional, etc.) of the organization.
At the same time, the Accounting Regulations “Accounting Statements of an Organization” PBU 4/99 requires from business partnerships and companies a report on changes in capital, which must contain at least data on the amount of capital at the beginning of the reporting period, an increase in capital, highlighting separately the increase due to additional issue shares, due to the revaluation of property, due to the increase in property, due to the reorganization of a legal entity (merger, accession), due to income, which, in accordance with the rules of accounting and reporting, are directly attributed to an increase in capital, a decrease in capital, highlighting separately the decrease due to reducing the par value of shares, due to a decrease in the number of shares, due to the reorganization of a legal entity (division, spin-off), due to expenses that, in accordance with the rules of accounting and reporting, are directly included in the reduction of capital, the amount of capital at the end of the reporting period.
For the purpose of reflecting in the financial statements of a joint-stock company information on the founders of the organization, stages of capital formation and types of shares, it is recommended to take into account the provisions given in Letter of the Ministry of Finance of the Russian Federation dated December 23, 1992 No. 117 “On reflection in accounting and reporting of transactions related to privatization of enterprises" (according to the conclusion of the Ministry of Justice of the Russian Federation dated November 2, 1994 No. 07-01-654-94, this document does not require state registration). In the absence of the specified information in the balance sheet, when reflecting data on the group of articles “Authorized capital”, it should be given as an explanation to the article “Authorized (share) capital” of the report on changes in capital or in an explanatory note.
The procedure for reflecting data on the types of reserves and funds formed, as well as changes in their balances at the end of the reporting period, is determined by the organization independently when developing and adopting its accounting reporting forms based on the sample forms given in Order of the Ministry of Finance of the Russian Federation dated July 22, 2003 No. 67n “On the forms of financial statements of organizations.”
When conducting an audit, it is necessary to check whether the requirements of regulations are met when generating the indicators of the “Cash Flow Statement”. Data from the cash flow statement should characterize changes in the financial position of the organization in the context of current, investment and financial activities. Current activity is considered to be the activity of an organization that pursues making a profit as the main goal or does not have making a profit as such a goal in accordance with the subject and goals of the activity, i.e. production of industrial and agricultural products, construction work, sale of goods, provision of services Catering, procurement of agricultural products, rental of property, etc.
Investment activities are considered to be the activities of an organization related to the acquisition of land plots, buildings and other real estate, equipment, intangible assets and other non-current assets, as well as their sale with the implementation of its own construction, expenses for research, development and technological developments; with financial investments (purchase of securities of other organizations, including debt securities, contributions to the authorized (share) capital of other organizations, provision of loans to other organizations, etc.).
Financial activity is considered to be the activity of an organization, as a result of which the size and composition of the organization’s equity capital and borrowed funds change (proceeds from the issue of shares, bonds, loans from other organizations, repayment of borrowed funds, etc.). Information on the organization's cash flows is presented in the currency of the Russian Federation. In the case of the presence (movement) of funds in foreign currency, information is generated on the movement of foreign currency for each of its types in relation to the cash flow statement adopted by the organization. After this, the data for each calculation made in foreign currency are recalculated at the exchange rate of the Central Bank of the Russian Federation as of the date of preparation of the financial statements. The data obtained for individual calculations is summarized when filling out the corresponding indicators in the Cash Flow Statement. The cash flow statement must contain information on cash flows (receipt, direction of cash) taking into account cash balances at the beginning and end of the reporting period, in the context of current activities, investment activities and in financial activities. Information on the movement of funds of the organization, recorded on the corresponding accounts of funds held at the organization's cash desk, in settlements, special currency accounts, is reflected on an accrual basis from the beginning of the year and is presented in the currency of the Russian Federation.
In the event of the presence (movement) of funds in foreign currency, a calculation in foreign currency is first made for each type of currency. After this, the data for each calculation made in foreign currency are recalculated at the exchange rate of the Central Bank of the Russian Federation as of the date of preparation of the financial statements. The data obtained for individual calculations is summarized when filling out the corresponding report indicators.
Organizations should keep in mind that in transcripts, cash flows associated with the payment (receipt) of interest and dividends, as well as the results of emergency circumstances, must be disclosed separately. Cash flows related to income taxes and other similar mandatory payments should be reported separately as part of operating data unless they can be specifically linked to investing or financing activities. When funds from the sale of foreign currency (including mandatory sales) are received into accounts with credit institutions or to the organization's cash desk, the corresponding amounts are reflected in data on current activities as the receipt of funds from the sale of fixed assets and other property. In this case, the amount of foreign currency sold is included in the data characterizing the expenditure of funds for current activities in the corresponding direction of expenditure.
When purchasing foreign currency, the transferred funds are included in the data on current activities in the relevant area. Receipts of acquired foreign currency are also reflected in current activities separately or as part of other receipts (except from the sale of fixed assets and other property).
Organizations should take into account that the cash flow report must provide information on cash receipts during the reporting period (except for cash receipts from a credit institution to the organization's cash desk), highlighting, among other things, settlements with legal entities and according to calculations with individuals, as well as with the selection from the data on the receipt of funds in cash using cash registers or strict reporting forms (that is, in the order of issuing receipts, vouchers, tickets, coupons, postage signs and other documents of strict reporting equivalent to checks). forms approved in accordance with the current procedure). If the organization in the relevant sections of the accepted form of the cash flow statement does not highlight separately the data on the amounts of funds deposited by the organization to the credit institution or received to the organization's cash desk from the credit institution, then these data must be presented in the cash flow statement for reference.
When conducting an audit, it is necessary to check whether the requirements of regulations are met when forming indicators in the Appendix to the balance sheet. Individual indicators included in the Appendix to the balance sheet (form No. 5) according to the sample form can be presented in the form independent forms financial statements or included in an explanatory note.
When conducting an audit, it is necessary to check whether the general requirements are met when filling out the explanatory note. The explanatory note should provide a brief description of the organization’s activities (ordinary activities; current, investment and financial activities), main performance indicators and factors that influenced the organization’s financial results in the reporting year, as well as decisions based on the results of consideration of the annual financial statements and distribution net profit, i.e. relevant information useful for obtaining a more complete and objective picture of the financial position of the organization, the financial performance of the organization for the reporting period and changes in its financial position. When presenting in the explanatory note the main performance indicators that characterize qualitative changes in the property and financial situation, their reasons, if necessary, the accepted procedure for calculating analytical indicators (profitability, share of own working capital, etc.) should be indicated.
1.6 Analysis of the results of the audit of accounting (financial) statements
When assessing financial condition for the short term, indicators can be provided to assess the satisfactoriness of the balance sheet structure (current liquidity, provision of own funds and the ability to restore (loss) of solvency). When characterizing solvency, you should pay attention to such indicators as the availability of funds in bank accounts, at the organization’s cash desk, losses, overdue accounts receivable and accounts payable, loans and borrowings not repaid on time, completeness of transfer of relevant taxes to the budget, penalties paid (to be paid) for failure to fulfill obligations to the budget. You should also pay attention to the assessment of the organization’s position on the securities market and the reasons for the negative phenomena that have taken place.
When assessing the financial situation for the long term, the characteristics of the structure of sources of funds, the degree of dependence of the organization on external investors and creditors, etc. are given. Characteristics of the dynamics of investments for previous years and for the future are given, with a determination of the effectiveness of these investments. In addition, an assessment of the organization’s business activity can be provided, the criteria of which are the breadth of product markets, including the availability of export supplies, the organization’s reputation, expressed, in particular, in the fame of clients using the organization’s services, and other information. The degree of fulfillment of planned indicators, ensuring the specified rates of their growth (decrease), the level of efficiency in the use of the organization’s resources. It is advisable to include in the explanatory note data on the dynamics of the most important economic and financial indicators of the organization over a number of years, descriptions of future investments, ongoing economic activities, environmental measures and other information of interest to possible users of the financial statements.
The final stage of the audit of business operations is a generalization of the audit results and analysis of errors identified during the audit. The list of verified documents, identified errors and violations, as well as the auditor’s opinion on the results of the audit are recorded in working documents.
2.1 Main elements of accounting policies
GrandService LLC is a manufacturer decorative tiles. The company operates according to common system taxation. The object of taxation is income minus expenses.
The main elements of the accounting policy of GrandService LLC include:
¾ object of taxation;
¾ assessment of raw materials and materials;
¾ evaluation of purchased goods;
¾ determination of expenses for the purchase of goods when taken into account in sales prices;
¾ calculation of interest on loans and borrowings accepted as expenses;
¾ accounting for partially paid fixed assets and intangible assets.
Let's consider the main provisions of the enterprise's accounting policy:
¾ organization of accounting: the organization’s accounting is carried out personally by the head;
¾ write-off of general business expenses: general business expenses are written off monthly as semi-fixed expenses. 90 "Sales";
¾ synthetic accounting of product output using account 40 “Output of products (works, services)”:
¾ assessment of finished products and shipped products is carried out at the full actual production cost (account 26 is closed to account 20, account 40 is not used);
¾ the valuation of shipped goods, completed works and rendered services is carried out at the actual full cost;
¾ distribution of sales expenses - sales expenses (account 44) are completely debited to account 90 “Sales”;
¾ distribution of profits remaining at the disposal of the organization among funds is made in accordance with the constituent documents of the organization.
2.2 Accounting for depreciable property
The accounting policy of GrandService LLC provides for a non-linear depreciation method for the following types of fixed assets:
¾ vibrating table;
¾ injection molds;
¾ concrete mixer.
At the same time, GrandService LLC is obliged to determine the residual value of depreciable property at the beginning of the year. This indicator is determined for each depreciation group based on the useful life established when these fixed assets and intangible assets were put into operation.
Depreciation is calculated based on the total balance of the corresponding depreciation group (subgroup) on the 1st day of the month for which the amount of accrued depreciation is calculated, and the established depreciation rate. Therefore, the total balance of the depreciation group (subgroup) is determined monthly. Since depreciation is calculated monthly, the total balance will be reduced monthly by the amount of accrued depreciation.
Depreciation charges for intangible assets are reflected in accounting by accumulating the corresponding amounts in a separate account 05 - “Amortization of intangible assets.”
To calculate depreciation of a vibrating table, the method of writing off the cost is used by the sum of the number of years of its useful life (the original cost is multiplied by the number of years remaining until the end of its service life divided by the number of years of the object's service life).
To calculate depreciation of injection molds, the reducing balance method is used (residual value at the beginning of the year multiplied by the depreciation rate multiplied by the acceleration factor (established in accordance with the legislation of the Russian Federation).
To calculate depreciation of a concrete mixer, the method of writing off the cost is used according to the sum of the number of years of its useful life (the original cost is multiplied by the number of years remaining until the end of its service life divided by the number of years of the service life of the object).
The accounting policy provides that:
¾ there is no revaluation of the original cost of fixed assets;
¾ no revaluation of intangible assets is carried out;
¾ an audit of accounting for depreciable property did not reveal any violations.
2.3 Accounting for materials and goods
The main regulatory documents governing the accounting of materials are PBU 5/01 “Accounting for material inventories", Guidelines for accounting of inventories and Guidelines for accounting of special tools, special devices, special equipment and special clothing.
In accordance with PBU 5/01, the following assets are accepted for accounting as inventories (MPI):
¾ used as raw materials in the production of products (performance of work, provision of services);
¾ intended for sale (goods and finished products);
¾ used for the management needs of the organization.
Inventories are accepted for accounting at actual cost.
Actual costs attributable to the actual cost of materials purchased for a fee include:
¾ amounts paid in accordance with the agreement to the supplier;
¾ amounts paid to organizations for consulting and information Services related to the acquisition of inventories;
¾ customs duties;
¾ non-refundable taxes paid in connection with the acquisition of a unit of inventory;
¾ fees paid to the intermediary organization through which inventories were purchased;
¾ costs for the procurement and delivery of inventories to the place of their use, including insurance costs;
¾ costs of bringing inventories to a state in which they are suitable for use for the planned purposes (costs of additional work, sorting, packaging and improving the technical characteristics of the received inventories, not related to the production of products, performance of work and provision of services);
¾ other costs directly related to the acquisition of inventories.
Active accounts are intended for synthetic accounting of the presence and movement of an organization’s own production inventories:
¾ 10 “Materials”;
¾ 14 “Reserves for reduction in the value of material assets”;
¾ 15 “Procurement and acquisition of material assets”;
¾ 16 “Deviation in the cost of material assets.”
Material assets that do not belong to the organization are recorded in off-balance sheet accounts 002 “Inventory assets accepted for safekeeping” and 003 “Materials accepted for processing.”
Synthetic accounting of the procurement of materials in GrandService LLC is carried out at accounting prices using accounts 15 “Procurement and acquisition of material assets”, 16 “Deviations in the cost of material assets”. Finished products are reflected in the balance sheet at actual production costs. Shipped goods, completed works and rendered services are reflected in the balance sheet at the actual full cost.
During the audit, it was revealed that sales books and purchase books were not properly prepared. According to clause 15. Resolution No. 914 “The purchase book and the sales book must be laced together, and their pages must be numbered and sealed. Control over the correct maintenance of the purchase book and sales book is carried out by the head of the organization or his authorized person.” In accordance with clause 14 of the Decree of the Government of the Russian Federation dated December 2, 2000. No. 914, “invoices that do not comply with the established standards for their completion cannot be registered in the purchase book.” If an organization receives an invoice with a facsimile reproduction of the head of the organization or the chief accountant, then it risks being left without VAT deduction. The accounting legislation and the Tax Code do not provide for a facsimile signature of the manager when preparing primary documents and invoices. The refusal of the inspectorate to deduct the amount of tax paid in this case will be lawful. This is the conclusion of the FAS VSO from the Resolution of July 20, 2005. No. A19-2073/05-5-F02-3384/05-S1. The same position is supported by the Ministry of Finance of Russia Letter of the Ministry of Taxes and Taxes of Russia dated April 1, 2004 No. 18-0-09/00042 dated October 26, 2005 No. 03-01-10/8-404. Tax officials are no less categorical. They believe that the use of facsimile reproduction of a signature and seal using mechanical or other copying on an invoice is not allowed (see, in particular, Letter of the Federal Tax Service of Russia dated February 14, 2005 N 03-1-03/210/11 and Letter of the Ministry of Taxes of Russia dated 04/21/2004 N 03-1-08/1039/17).
2.4 Accounting for special clothing
Accounting for special tools, special devices, special equipment and special clothing is carried out on account 10 “Materials”.
According to the accounting policy of the enterprise, special tools, special devices, special equipment and special clothing are taken into account as part of funds in circulation.
A one-time write-off of the cost of special clothing, the service life of which, according to the issuance standards, does not exceed 12 months, is made at the time of transfer (vacation) to employees.
No violations of special clothing accounting were identified during the audit.
2.5 Accounting for fixed assets
The accounting and reporting indicate the amount of the authorized capital in an amount that does not correspond to the constituent documents submitted for verification. Such discrepancies must be resolved to avoid liability for accounting violations. A gross violation of the rules for accounting for income and expenses and objects of taxation means the absence of primary documents, or the absence of invoices, or accounting registers, systematic (two or more times during a calendar year) untimely or incorrect reflection in accounting accounts and in business reports. transactions, cash, tangible assets, intangible assets and financial investments of the taxpayer.
The audit report noted that at the same time liability may arise for officials of the enterprise under Art. 15.11 of the Code of Administrative Offenses of the Russian Federation for gross violation of the rules of accounting and presentation of financial statements, as well as the procedure and terms for storing accounting documents, in the form of an administrative fine in the amount of twenty to thirty times the minimum wage. A gross violation of the rules of accounting and presentation of financial statements means: distortion of the amounts of accrued taxes and fees by at least 10 percent; distortion of any article (line) of the financial reporting form by at least 10 percent.
2.6 Accounting for labor costs
According to the financial statements, salaries are paid once a month. According to Article 136 of the Labor Code of the Russian Federation, wages must be paid at least every half month. The day of payment of wages is established by internal labor regulations, a collective agreement or an employment contract. Other deadlines for payment of wages can be established for certain categories of workers only by federal law.
Thus, paying wages once a month is a violation of labor laws. It should be borne in mind that the employee’s statement of consent to receive wages once a month does not relieve the employer from liability. federal Service on Labor and Employment especially emphasized this circumstance in a Letter dated March 1, 2007. No. 472-6-0.
The labor inspectorate has the right to inspect any company once every two years. This is a scheduled check. Scheduled inspections can be comprehensive - then the company is visited by two inspectors. One checks the “legality” of personnel documents. The second is the compliance of working conditions with labor protection standards. Also, the audit can be carried out jointly with the tax office, the Pension Fund, and the Social Insurance Fund. In the case of a targeted audit, documents in a certain area are examined (for example, everything related to wages). Up to 90% of inspections are initiated by former employees based on their complaints.
The punishment for violations of labor laws is quite serious: in accordance with Art. 5.27 of the Code of Administrative Offenses of the Russian Federation, violation of labor and labor protection legislation entails the imposition of an administrative fine on officials in the amount of from five to fifty times the minimum wage, and on legal entities - from three hundred to five hundred times the minimum wage or administrative suspension of activities for up to ninety days.
2.7 Auditor's report
In accordance with the Procedure for drawing up an audit report on financial statements, approved by the Commission on Auditing Activities under the President of the Russian Federation dated December 30, 2008. Based on the results of the audit, the auditor must express an opinion on the reliability of these statements.
A random audit was carried out at GrandService LLC. Based on the results of the audit, the following conclusions can be drawn. The financial statements of the enterprise are prepared in accordance with the regulations on accounting and financial reporting in the Russian Federation, PBU 4/99 and the Instructions on the procedure for drawing up and submitting financial statements. Before drawing up the annual report, an inventory of all the assets and liabilities of the organization is carried out, the results are documented in the relevant documents. Operating and performance accounts are closed, and the financial result of the organization’s activities for the reporting year is revealed. Basically, all reporting forms are filled out correctly. In the income statement, the composition of operating and non-operating expenses is clear. Form No. 3 is filled out correctly, in accordance with the requirements. The cash flow statement is also filled out correctly, without any violations. The accountant correctly reflects balances and turnover from the general ledger and order journals in the report. The correctness of the reporting forms is confirmed by compliance with the interconnection of reporting indicators, which was verified during the audit.
Thus, as a result of the audit, the following violations were identified:
¾ violation of the wage regime;
¾ in accounting and reporting the amount of the authorized capital is indicated in an amount that does not correspond to the constituent documents submitted for verification;
¾ sales books and purchase books are not properly prepared.
At the present stage of audit development, not only owners are interested in its results, but also economic entities themselves, whose normal development is often impossible without attracting funds from investors, sponsors and creditors. To attract financial investments, an economic entity must be successful, and its accounting (financial) statements must inspire confidence among potential investors and creditors.
Over the past decades, the requirements for organizing the accounting and reporting system have increased significantly. New forms and methods of accounting have emerged, including the use of computer systems. Accounting statements have become the main source of information that allows one to assess the financial and property status of economic entities. In these circumstances, the audit of financial statements has become an important tool for improving the quality of financial statements, the leading component of which is its reliability. No reputable bank will provide a loan to a client that does not have audited accounting (financial) statements, just as no serious investor will deal with an organization whose reports have not been audited by a reputable auditor for a number of years.
In the course of writing the course work, we revealed the theoretical and methodological foundations of auditing, examined the features of accounting, analyzed the performance indicators of the enterprise and production efficiency, the financial condition of the enterprise, determined the correctness of the preparation of annual reporting forms and identified shortcomings.
A practical study of the topic of work was carried out using the example of GrandService LLC, whose main activity is the production of decorative tiles. Based on the study, it was revealed that internal audits are not carried out at the enterprise. Independent auditors are invited to the enterprise to conduct an external audit. The purpose of the external audit of GrandService LLC is to confirm the reliability of the financial statements.
During the audit of the accounting of depreciable property and the accounting of special clothing, no violations or shortcomings were identified. And a check of the accounting of materials and goods showed that sales and purchase books were not properly prepared. Recommendations were also given to eliminate in accounting the discrepancy between the amount of the authorized capital and the constituent documents, and in the accounting of wages the provision of the Labor Code of the Russian Federation on the payment of wages at least every half month is not followed.
The audit revealed that the accounting statements of GrandService LLC for the audited period are reliable, i.e. prepared in such a way as to ensure, in all material aspects, the reflection of assets and liabilities and the financial results of its activities based on the Federal Law “On Accounting” No. 129-FZ of November 21, 1996.
As a result of the external audit, taking into account the recommendations, GrandService LLC received valuable information to improve management and accounting, which helps to increase the efficiency of the enterprise as a whole, which is also important for increasing the income of the enterprise
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AUTONOMOUS NON-PROFIT ORGANIZATION
HIGHER PROFESSIONAL EDUCATION
CENTRAL UNION OF THE RUSSIAN FEDERATION
"RUSSIAN UNIVERSITY OF COOPERATION"
Vladimir branch
Department of Economic Analysis and Audit
COURSE WORK
Discipline: Practical audit
On the topic of: Completion of the audit
Vladimir 2010
Content
Introduction………………………………………………………… ………………3
Chapter 1. Evaluation of the results of audit procedures………………………….4
- Forming an opinion regarding the impact of detected errors on the reliability of financial statements…………………………………….4
Final assessment of financial statements…………………………….9
Documentation of all existing decisions made during the audit and the results of their implementation………………………………………………………10
2.1. Matters Having a Significant Effect on the Audited Financial Statements………………………………………………………………………………………17
2.2. Preliminary and final version of written information..19
Chapter 3. Drawing up an audit report……………………………..22
3.1. Structure of the auditor's report……………………………………...22
3.2. Forms and procedure for submitting the auditor’s report……………26
3.3. Events that occurred after the date of preparation and presentation of financial statements………………………………………………………………29
Conclusion…………………………………………………… ………….……..32
Bibliography………………………………………….……… …………34
Introduction
Russia's transition to market relations has revealed the need to create new economic institutions that regulate the relationships between various business entities, and among them one of the leading places belongs to the auditing institution, the main goal of which is to ensure control over the reliability of information reflected in accounting (financial) and tax reporting.
In Russia, in recent years, some work has been done to establish an auditing institution. Presidential Decree on auditing activities in the Russian Federation No. 2263 dated December 22, 1993 was adopted, which approved the Temporary Rules for Auditing Activities in the Russian Federation. The adoption of the Federal Law “On Auditing Activities” (No. 119-FZ of August 7, 2001) confirms the final formation of the Russian audit system and opens up prospects for its further development. In accordance with the Law, the Government of the Russian Federation and the Ministry of Finance of Russia have adopted a number of resolutions and regulations to regulate auditing activities, promoting its development and establishment.
The purpose of writing the work is to study this topic using economic literature and regulations.
The main objectives of the work can be formulated as follows:
- study the assessment of the results of audit procedures;
- consider the auditor’s written information to the management of the economic entity based on the results of the audit;
- study the principle of drawing up an audit report.
Chapter 1. Evaluation of the results of audit procedures
- Forming an opinion regarding the impact of detected errors on the reliability of financial statements
Distortion of financial statements is the incorrect reflection and presentation of accounting data due to a violation of the established rules for its organization and maintenance. Distortions can be: intentional and unintentional.
Intentional distortion of financial statements is the result of deliberate actions (or inaction) of the personnel of the audited economic entity. It is committed for selfish purposes in order to mislead users of financial statements. At the same time, the auditor should take into account that a conclusion about deliberate actions (or inaction) of the personnel of an economic entity leading to distortions in the financial statements can only be made by an authorized body.
Unintentional distortion of financial statements is the result of unintentional actions (or inaction) of the personnel of the audited economic entity. It may be the result of arithmetic or logical errors in accounting records, errors in calculations, oversights in the completeness of accounting, incorrect reflection in the accounting of facts of economic activity, the presence and condition of property.
Both intentional and unintentional distortion of the financial statements of the audited economic entity can be significant (i.e., affecting the reliability of its financial statements to such a strong extent that a qualified user of its financial statements can draw erroneous conclusions or make erroneous decisions based on such statements) or insignificant.
During the audit, the audit organization should assess the risk of misstatements in the financial statements and the risk of their non-detection. Here, the audit organization must take into account factors that increase the risk of both unintentional and intentional misstatements. Factors in the intra-economic activity of an economic entity that contribute to the emergence of distortions include:
- the presence of significant financial investments in crisis sectors of the economy;
- discrepancy between the amount of working capital and the rapid growth in sales (production) of an economic entity or a significant decrease in profits;
- dependence of an economic entity in a certain period on one or a small number of customers or suppliers;
- changes in contractual practices or accounting policies that lead to a significant change in profit;
- atypical transactions of an economic entity, especially during the end of the year, which significantly affect the value of financial indicators;
- the presence of payments for services that clearly do not correspond to the services provided;
- features of the organizational and managerial structure of an economic entity, its shortcomings;
- features of capital structure and profit distribution;
- presence of deviations from established rules in accounting and organization of preparation of financial statements;
Factors that reflect the particular state of a specific sector of financial and economic activity of an economic entity and the country’s economy as a whole, contributing to the emergence of distortions, include:
- the state of the economic sector and the country’s economy as a whole - crisis, depression, recovery;
- industry-specific features of the insolvency (bankruptcy) of an economic entity in connection with the crisis state of the industry;
- features of the production activity of an economic entity, technological features of production.
When conducting an audit, including when planning an audit, the audit organization must take into account the possible presence of distortions in the financial statements of the audited economic entity. Based on this, the audit organization develops audit procedures and assesses the risk of misstatements in the financial statements. At the same time, the audit organization should not, during the audit process, specifically search for facts indicating the presence of distortions in the financial statements.
When identifying distortions in the financial statements of an economic entity, the audit organization must assess their impact on the reliability of the audited statements in all material respects. In this case, one should take into account possible types of violations of an economic entity that lead to distortions, such as:
- deviations from the rules for maintaining and organizing accounting and reporting established by law;
- absence or non-compliance during the reporting period with the adopted accounting policy of reflecting individual business transactions and property valuation in the accounting records;
- violations of civil, tax and currency laws;
- other violations affecting the distortion of financial statements.
If distortions in the financial statements are detected, the auditor must adjust the audit procedures developed by him depending on:
-types of violations leading to distortions;
- - the degree of materiality of the identified misstatements;
When identifying distortions in the financial statements, the audit organization must assess how effectively the internal control system of the economic entity prevents the occurrence of various violations leading to the appearance of distortions in the financial statements. If the audit organization concludes that the internal control system’s ability to prevent misstatements in financial statements is lower (than previously assumed), the audit organization should reconsider its previous assessment of the reliability of the internal control system and, in this regard, clarify the scope and nature of the audit procedures used.
Facts of distortions in the financial statements of the audit organization identified during the audit should be reflected in detail in its working documentation, drawn up in the prescribed manner: the audit organization must include information about the identified distortions in the auditor’s report on the financial statements when conducting a statutory audit or in the auditor’s report when conducting an initiative audit various target orientations.
The audit organization is responsible for:
- expression of an objective and substantiated opinion on the reliability of the financial statements, presented in writing in the auditor’s report and (or) report to the management of the audited economic entity;
- the correctness and completeness of the data reflected in the auditor’s conclusion and report on the significant misstatements of the financial statements identified by him;
- non-compliance with the confidentiality of commercial information of an economic entity, expressed in the disclosure of information about identified distortions in financial statements to third parties (except for cases expressly provided for by current legislation).
The personnel of the inspected economic entity, including its management, are responsible for:
- occurrence of intentional and unintentional distortions in financial statements;
- failure to take measures to prevent the occurrence of such distortions;
- failure to eliminate or untimely elimination.
- Final assessment of financial statements
The purpose of the audit is to establish that all points of the general plan and audit program have been fulfilled, and based on the results of the audit procedures, ordinary performers have drawn the correct conclusions.
The review director must ensure that:
- the audit plan and program have been fully implemented, the audit program contains marks, designations, and signatures confirming its completion;
- the size of the audit sample is determined correctly;
- the conclusions drawn are consistent with the results of the audit procedures;
- the preparation of working documents complies with the federal rules (standards) of auditing activities and the internal standards of audit organizations and auditors;
- the detected distortions in the financial statements do not exceed, individually or in aggregate, the level of materiality established by the audit organization;
- the audit file (a set of audit working documents) contains a sufficient amount of audit evidence necessary to substantiate the conclusions drawn;
- the audit as a whole was carried out in accordance with the requirements of the internal standards of the audit organization.
- Documentation of all existing decisions made during the audit and the results of their implementation
In addition, the written report contains constructive proposals for improving the accounting system and internal control of the economic entity.
During a proactive audit, audit organizations are also required to prepare and provide a written report to economic entities in cases where:
- the contract for the implementation of a proactive audit based on the results of the audit provides for the preparation of an audit report;
The contract for the implementation of a proactive audit does not provide for the preparation of an auditor's report, but the preparation of written information from the auditor.
The auditor's written report cannot be considered a complete report of all existing deficiencies, since it indicates only those that were discovered during the audit process.
The auditor's written report is prepared during the audit and is presented to the manager and owner of the economic entity subject to the audit at the final stage of the audit. The written report is a confidential document and may only be disclosed to:
- the person who signed the agreement (contract, letter of commitment) for the provision of audit services;
- the person directly indicated as the recipient of the auditor’s written report in the agreement (contract, letter of engagement) for the provision of audit services;
- to any other person in the event of a written instruction to the address of the audit organization of the person who signed the agreement (contract, letter of commitment) for the provision of audit services.
Certain issues of the auditor's written report can be discussed orally or through an exchange of letters with employees of the economic entity during its audit, taking into account the degree of responsibility, access to information and the level of competence of these employees.
For example, if the fact of failure to submit any documents to the auditor based on the results of the procedure for checking the completeness of primary documents for a specific section (section) is recorded in the auditor’s written report, then the employees of the audited economic entity will not be able to take timely actions to find them. If duplicates of these documents are subsequently received, the auditor will have to change his findings, calculations, written report, etc. That is why a letter about the need to obtain duplicates of primary documents should be sent to the management of the accounting department during the audit. If such documents are not presented before the auditors complete their work on collecting audit evidence, then the fact that certain documents are missing will be reflected again in the written report.
Auditors must include all incoming and outgoing written documents of this kind with their other working documentation.
Based on the results of the audit, in agreement with the management of the economic entity, a preliminary version of the auditor’s written report can be prepared. The preliminary version of the written report may be distributed only to those persons to whom the final version is also presented.
The preliminary version of the auditor's written report may contain requirements for making (following the rules established for this purpose) corrections to accounting data and for preparing a list of clarifications to already prepared financial statements. Compliance with such requirements, if they relate to corrections of a significant nature, is mandatory so that the audit organization can subsequently provide the economic entity with a positive audit report.
The management of an economic entity can:
- prepare a written response to a preliminary version of the auditor’s written report, reflecting the auditee’s point of view on the comments contained in the version of this document;
- meet with the auditors who conducted the audit, inviting on their part those persons deemed necessary to discuss a preliminary version of the document.
The final version of the auditor's written report must be prepared and presented to the management of the audited enterprise no later than the auditor's report.
The comments of the economic entity are accepted by the audit organization if the auditors deem it necessary.
If the preliminary version of the auditor's written report contained comments of a significant nature, the final version of the written report must evaluate and analyze the corrections made by the employees of the economic entity in order to fulfill the requirements of the auditors.
In accordance with the Russian auditing rule (standard) “The actions of the auditor when identifying distortions in the financial statements,” the audit organization must reflect in detail the facts of distortions in the financial statements discovered during the audit in its working documentation.
In addition, information about identified distortions should be included in the auditor’s written report to the management of the economic entity being audited, and if the violations are not corrected, then in the auditor’s report on the financial statements.
After studying the preliminary version of the auditor's written report, the management of the audited enterprise may decide to make corrections to the financial statements.
It should be remembered that although the auditor's written information contains the final figures for adjustments to items in the financial statements, it is not enough to make corrections only in the reporting forms. Corrections are considered made only if they are made in accounting - accounting certificates for making corrections are issued, accounting entries are made, new analytical and synthetic accounting registers are formed and financial statements are compiled.
In order for the audit organization to be convinced that the necessary corrections of significant irregularities in accounting have been made, the audited economic entity must provide it not only with a new version of the financial statements, but also with a balance sheet or other accounting register, on the basis of which the organization draws up a balance sheet , as well as a list of corrective accounting entries.
In accordance with the federal auditing standard “Audit's report on financial (accounting) statements,” if, as a result of an audit, an economic entity has made the necessary amendments to the financial statements before presenting them to interested users, then the auditor’s report should not contain indications of these amendments.
If the audit takes place after the reporting is presented to interested users, then if the errors and irregularities in the financial statements are of a significant nature, before corrections are made, the audit firm must provide an audit report other than an unconditionally positive one.
The auditor's written information (preliminary and final versions) is compiled in at least two copies. One copy of written information is handed over against signature only to those persons to whom this information can be provided in accordance with the requirements of the Russian auditing standard, the second copy remains at the disposal of the audit organization and is attached to other working documentation of the auditor. Disagreement of the recipient of the auditor's written information with the content of its final version cannot serve as a basis for refusal to receive the said document.
By agreement with the recipient, the auditor's written information may be sent by mail or other means. In this case, during archival storage in the audit organization, documents confirming the fact of mailing or another method of transmitting written information are attached to the second copy of the auditor’s written information.
The auditor's written information is a confidential document. The information contained therein is not subject to disclosure by the audit firm, its employees or an auditor working independently, except in cases expressly provided for by the federal laws of the Russian Federation.
An economic entity has the right to dispose of the information contained in the auditor’s written information at its own discretion. The audit organization is not responsible for the disclosure of confidential client information that occurred through the fault or with the knowledge of employees of the economic entity subject to the audit.
In the event of a change in the audit organization, the management of the audited economic entity is obliged to provide the new audit organization with copies of written information based on the results of audits for at least three previous financial years prepared by the previous audit organization (audit organizations). The new audit organization is obliged to maintain the confidentiality of information contained in documents prepared by the previous audit organization (audit organizations).
Chapter 2. Written information from the auditor to the management of the economic entity based on the results of the audit
2.1. Matters that have a significant effect on the audited financial statements
Subsequent events have a very significant impact on the results of the audit. For this purpose, ISA 560 Subsequent Events must apply.
The purpose of ISA 560 is to establish standards and provide guidance regarding the auditor's responsibilities related to subsequent events.
All the main provisions of ISA 560 are based on IFRS 10 “Contingencies and events that occur after the reporting date”.
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