Building Societies - Specialized Audit Situation
Building Societies are organisations that exist to offer a savings and investment intermediate to the public and to lend to personalities money to enable them buy their own houses obtaining as security the deeds of the houses. Such they are not limited companies however are run through a board of directors chosen through the investors and permanent staff. There is strong similarity in the legislation covering building societies and such covering companies.
Some of additional control problems peculiar to building societies are:
i. The large volume of withdrawals and deposits of small amounts of cash;
ii. The compromise of loans on mortgage
iii. Control over documents of title heading
iv. Control over investments and their related income
It shall be the duty of a building society of the auditors to carry out such investigations as will enable them to form the opinion as to the following matter.
(a) Where the society has kept proper books of account;
(b) Where the society has kept a satisfactory system of control over its records and transactions;
(c) Where appropriation account and revenue and the balance sheets are in agreement along with the books of account and records of the society and which the auditors are of the opinion such the society has failed to maintain proper books of account or specific records or a specific system of control they should state such fact in their report.