1 / 20

Audit of charitable trust

Audit of charitable trust. In this issue. Auditors duty as to check Constitution of trust Various aspects of authorization receipts & expenditures Audit of liabilities Audit of assets Conduct analytical review Report to the management. CONSTITUTION OF TRUST. Check up the

velika
Download Presentation

Audit of charitable trust

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Audit of charitable trust

  2. In this issue • Auditors duty as to check • Constitution of trust • Various aspects of authorization • receipts & expenditures • Audit of liabilities • Audit of assets • Conduct analytical review • Report to the management

  3. CONSTITUTION OF TRUST • Check up the • Constitution of the trust • Byelaws, rules & regulations of the trust • Object for which trust is settled • Application of the fund of the trust • Minutes of the board of trustees • Provisions of trust act of concerned state

  4. Receipt RECEIPT CONTRIBUTION & GRANT FUND RAISING PROGRAMME MEMBERSHIP FEES SUBSCRIPTION

  5. CONTRIBUTIONS • Check for the agreement with donor • Check for the grant letters • Check the accounting for the fund received • Check applicability of the fcra law • Verify donations with copies of receipt issued • See for any conditions attached to contributions • Verify income of the interest & dividend • Check the accountability for TDS if any

  6. FUND-RAISING PROGRAMME • Verify in details the internal control system • See the responsible persons for the collection of the fund • See for the mode of the receipts • Ensure all the collections are accounted for & deposited in daily basis • Check up the receipt with the documentary evidence

  7. Membership fees • Check for the fees received with the membership register • Ensure proper classification is made between entrance & annual fees • Reconcile fees received with the fees to be received during the year • Vouch for fees received with duplicate copies of the receipt issued

  8. subscription • Check the amount with subscription register & receipt issued • Reconcile subscription received with the dispatch of corresponding magazine • Check the receipt with subscription rate schedule • See for the arrears of subscription & steps taken to recover • See for the subscription in advance & its adjustment in the year of receipt

  9. expenditure EXPENDITURE PROGRAMME EXP. ESTABLISHMENT EXP.

  10. Programme & project expenses • Verify agreement with donor to ascertain the condition for undertaking project • Ascertain whether I.C. Works systematically in this regard • Ensure income tax is deducted & deposited • Ensue return is filed properly in case of payment

  11. ESTABLISHMENT EXPENSES • Verify PF, life insurance, and administrative charges are deducted • Check for office & administrative exps. • With reference to relevant vouchers & • Relevant supporting documents • Check for the revenue & capital expenditures • Ensure trustees are not benefited out of the institution

  12. AUDIT OF LIABILITIES • Vouch contribution & grant towards corpus • Verify all contribution in kind is duly recorded • Vouch special contribution have been utilized for specified purpose • Vouch for the earmarked funds • Verify whether any fund has been left unspent • Ascertain the borrowing power of NGOs

  13. AUDIT OF ASSETS AUDIT OF ASSETS FIXED ASSETS INVESTMENT CURRENT ASSETS

  14. AUDIT OF FIXED ASSETS • Vouch all acquisitions/ sale of assets • Check calculation for depreciation • Verify accountability of assets received as contributions • Check donor’s letters/agreements for the grant • Conduct physical verification of the fixed assets

  15. Audit of investments • Verify the investment register • conduct physical inspection of investments • Ensure that investments are in the name of the NGO • Verify whether accrued income on investment have duly accounted for • Verify fresh investments and dis-investments by approval of appropriate authority and • Check bank accounts for the principal amount and interest.

  16. Audit of current assets • Physically verify the cash in hand and imprest balances • At the closing of the year see whether it tallies with books of account • Check the bank reconciliation statements • Ascertain details for old outstanding and unadjusted amounts. • Verify stock in hand • obtain certificates from the management for the quantities and valuation of cash

  17. Analytical procedure • Carry out the substantive or compliance audit procedure for analytical review • Compare the information of the prior periods • Conduct the variance analysis • In any inconsistency , investigate the difference by adopting the further audit procedure • Look for the anticipated result of the entity like budget forecast, expectation of the auditor

  18. Forming an opinion • The auditor shall form an opinion on the financial statements on the basis whether: • Sufficient & appropriate audit evidence has been obtained • Uncorrected mis-statements are material • Statements are prepared with requirement of the applicable financial reporting framework • Accounting estimates by the management are reasonable • Financial statement discloses significant accounting policies selected & applied

  19. conclusion • Auditor has to outline audit programme so as to check • Constitution of the trust • Income of the trust • Expenditure of the trust • Audit of assets • Audit of liabilities • More information in this regard on Accountable 89

  20. Further Reading • AccountAble 141: Charitable Purpose and Income Tax

More Related