Audit work on the holding company, Auditing

Audit Work on the Holding Company

We will focus on the verification of investments in subsidiary companies.

1. Get a schedule that should contain the following information. All the data such the Companies Act needs to be disclosed in the holding company's own accounts, copies of the accounts of each and every subsidiary along with a note who that the auditor is, summary of movements in investments in subsidiary, details of any qualifications in any of the audit reports, and on current and loan accounts along with its subsidiary, reconciliations of intercompany balances.

2. Ownership and Existence must be verified through examining the share certificates and ensuring such they are in the identification of the holding company. Whether not, then blank signed transfer forms should be obtainable from the nominees. Whether the share certificates are held through third parties, after that an suitable certificate must be acquired.

3. Loan and Current accounts: Their verification is usually done through acquiring a certificate from its subsidiary verifying the balances. Also whether the auditor of the holding company is the auditor of the subsidiary, so he can reconcile entries in equally sets of books himself. The auditor must convince himself about dealings among group companies are not required to cover up material errors.

4. Valuation: Valuation is verified as follows: whether the shares were obtained in the year consider authorization and cost. Examine accounting treatment of any discount and premium upon acquisition and any dividends obtained out of pre-acquisition profits. The balance sheet value of its subsidiary might be considered and this could involve review of each individual subsidiary's account to verify that it is now a going concern.

Posted Date: 1/28/2013 4:54:35 AM | Location : United States







Related Discussions:- Audit work on the holding company, Assignment Help, Ask Question on Audit work on the holding company, Get Answer, Expert's Help, Audit work on the holding company Discussions

Write discussion on Audit work on the holding company
Your posts are moderated
Related Questions
Higher  normal risk Several audit assignments involve high audit risk and usually in any client there will always be at least one high risk area.  Indications that an audit has

Auditor's Procedures - Going Concern In forming a thought on the going to relate position of a company, the auditors have to: a) Examine the company, its plans for the futu

Insurance Companies Authoritative documents involved as: The Insurance Act The Companies Act IFRS 4 Insurance Contracts The major legislation governing insu

Incorporated Banks under Companies Act Banks are incorporated under the Companies Act like any other business but are granted special privileges under the same Companies Act a

Capital allowances vs. Depreciation Whether the client can prove such they will keep the existing levels of investment in original terms, then there may be justification to ac


Subsequent Events - Audit Process IAS 10 Events after the Balance Sheet Date prescribes the accounting for, and disclosure of, events than the balance sheet date. Events th

What is the role of the auditor, and what are the key duties the auditor must carry out? Role of the Auditor In modern commercial environmental it is desirable that bus

Ownership and Existence - Verification Procedures Establishment of title and beneficial ownership of investments is not convincingly possible. Conversely, evidence is obtainab