Published On:Wednesday, 14 December 2011

Posted by Muhammad Atif Saeed

The primary aim of an audit is to enable the auditor to say “these accounts show a true and fair view” or, of course, to say that “they do not show a true and fair view”.
At the end of his audit, when he has examined the entity, its record, and its financial statements, the auditor produces a report addressed to the owners/stake holders in which he expresses his opinion of the truth and fairness, and sometimes other aspects, of the financial statements.

Standard format of Auditor’s Report as per the Companies Ordinance 1984:
FORM 35A
AUDITORS’ REPORT
We have audited the annexed balance sheet of COMPANY NAME as at THE DATE and the related profit and loss account, cash flow statement and statement of changed in equity together with the notes forming part thereof, for the year then ended and we state that we have obtained all the information and explanations which to the best of our knowledge and belief were necessary for the purposes of our audit. It is the responsibility of the company’s management to establish and maintain a system of internal control and prepare and present the above said statements in conformity with the approved accounting standards and the requirements of the Companies Ordinance, 1984. Our responsibility is to express an opinion on these statements based on our audit.
We conducted our audit in accordance with the auditing standards as applicable in Pakistan. These standards require that we plan and perform the audit to obtain reasonable assurance about whether the above said statements are free of any material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the above said statements. An audit also includes assessing the accounting policies and significant estimates made by management, as well as evaluating the overall presentation of the above said statements. We believe that our audit provides a reasonable basis for our opinion and, after due verification, we report that:
a) In our opinion, proper books of accounts have been kept by the company as required by the Companies Ordinance, 1984
b) In our opinion:
i. The balance sheet and profit and loss account together with the notes thereon have been drawn-up in conformity with the Companies Ordinance, 1984, and are in agreement with the books of account and are further in accordance with accounting policies consistently applied
ii. The expenditure incurred during the year was for the purpose of the company’s business; and
iii. The business conducted investments made and the expenditure incurred during the year were in accordance with the objects of the company.
c) In our opinion and to the best of our information and according to the explanations given to us, the balance sheet, profit and loss account, cash flow statement and statement of changes in equity together with the notes forming part thereof conform with approved accounting standards as applicable in Pakistan and, give the information required by the Companies Ordinance, 1984, in the manner so required and respectively give a true and fair view of the state of the company’s affairs as at DATE and of the profit/loss its cash flows and changes in equity for the year then ended; and
d) In our opinion Zakat deductible at source under the Zakat and Usher Ordinance, 1980 was deducted by the company and deposited in the Central Zakat Fund established under Section 7 of that Ordinance.

Date Signature
Place (Name(s) of Auditors)

(Virtual University Notes)