Company Audit MCQs - Sanidhya Saraf
Company Audit MCQs - Sanidhya Saraf
2. Within how many days the auditor is required to intimate ROC about his
appointment?
(a) 15 days
(b) 30 days
(c) 45 days
(d) 60 days
4. Mr Ram who has been appointed by the members suddenly meets a plane crash
and died. The casual vacancy shall be filled by
(a) BOD within 30 days.
(b) Members within 30 days.
(c) BOD within 60 days.
(d) Central Government
11. Mr Ram the auditor of the company submitted his resignation. He is required to intimate to ?
(a) The BOD
(b) The ROC
(c ) Both a and b.
(d) BOD, ROC and CG.
13. The company proposes to remove Mr , Shyam the Auditor before the expiry of term.
The procedure to be followed is?
(a) Firstly BR , then SR, then CG approval.
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14. Mr Ram, the auditor of the company has been removed by the Tribunal on the grounds
of fraud. Which of the following implication is correct?
(a) He cannot be appointed as the auditor of the same company for a period of 5 years.
(b) He cannot be appointed as the auditor in any company for a period of 5 years.
(c) He cannot be appointed as the auditor in any company for a period specified in the
Tribunal order.
15. Mr Hanuman ,is a director of the company. He can’t be appointed as the auditor in
(a) The company.
(b) The company and its subsidiary.
(c) The company, subsidiary and associate.
(d) He can be appointed as the auditor in all of them.
16. Rahul’s grandfather holds security of Rs 10 lakh face value in ABC Ltd. Which of the
following statement is correct?
(a) Rahul is disqualified to be appointed as auditor in the company.
(b) Rahul is disqualified to be appointed as auditor in the company and its subsidiary.
(c) Rahul is disqualified to be appointed as auditor in the company and its subsidiary and
associate.
(d) He can be appointed as the auditor in all of them.
17. Rahul’s mother holds security of Rs 10 lakh face value in ABC Ltd. Which of the
following statement is correct?
19. Singhi and Enterprise (CA Firm) has a business relationship with ABC Ltd. Singhi and
Enterprise are disqualified to be appointed as auditor of?
(a) ABC Ltd
(b) ABC Ltd , its subsidiary, holding, associate and subsidiary of holding.
(c) ABC Ltd , its subsidiary, holding, associate and subsidiary of holding and associate.
(d) He can be appointed as the auditor in all of them.
20. “ABC and Company” is an audit firm having partners “Mr. A”, “Mr B” and “Mr C” Chartered
Accountants "Mr. A", Mr. B "and "Mr. C" are holding appointments as Auditor in 4, 6 and 10
Companies respectively. How many audits they can accept?
(a) 16, 14 and 10 respectively.
(b) 6, 4 and O respectively.
(c) Unlimited accounts.
(d) He 26, 24 and 20 respectively.
21. "ABC and Company" are statuary auditors of ABC Ltd. Subsequently they started
providing actuarial services to the company. Which of the following statement is correct?
(a) Disqualified to be appointed as auditor in the company.
(b) Disqualified to be appointed as auditor in the company, holding and subsidiary.
(c) Disqualified to be appointed as auditor in the company, holding and subsidiary and associate.
(d) There is no prohibition in providing actuarial services.
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24. Which of the following are to be included mandatorily in the audit report?
(a) Whether all the information and explanation relevant for the audit has been obtained.
(b) Whether personal expenditure is debited to revenue account.
(c) Whether the loans and advances given are unsecured and prejudicial to the interest
of the company.
(d) Whether the book entries are prejudicial.
30. Which of the following do not fall in the category of regulated sectors for the purpose
of cost audit?
(a) Fertilizers
(b) Telecommunication
(c) Turbo jets
(d) Electricity
31. A company dealing in petroleum and natural gas has an overall turnover of 65 crores
and turnover of the individual products is 30 crores. However, the company generates
electricity and uses it for captive consumption. Considering the above situations which of
the following statement is correct
(a) Company is exempted from the requirements of cost audit and maintenance of cost
records.
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(b) Company is exempted from the requirements of cost audit but not from the
requirement to maintain the cost records.
(c) Both the requirements of cost records and cost audit are mandatory.
32. X Ltd. Is engaged in the production of Iron and Steel. A CA Firm ABC Co was appointed
as the statuary auditor of X Ltd. for the current financial year. During the year, the
management of the company realized that the company is required to maintain cost
records in their books of account and get it audited. Therefore, in a general meeting , the
members of the company appointed ABC Co as the cost auditor of the company. You are
required to examine the validity of appointment of ABC Co. as the cost auditor.
(a) Appointment done by the members is valid.
(b) Appointment done by the members is invalid. Appointment shall be done by the BOD.