Answer.
An audit note is usually a bound book in which a larger variety of matters over served during the course of audit are recorded. It is thus a part of the permanent record of the auditor available for reference later on, if required. The audit note also provides a valuable help to the auditor in picking up the links of work when the concerned assistant is away or the work is stopped temporarily because it is recorded along with observations the various queries, explanations obtained and evidence seen, while observations the various queries, explanations obtained and evidence seen, while queries remaining undisposed of would be noted for follow up. It is more satisfactory in some ways, however, to use loose sheets for entering queries and notes which, subsequently, on being punched, may be filed in a special query file maintained for each client or along with the clients‟ accounts papers, separately for each year.
Audit queries not cleared immediately e.g. missing receipts, vouchers etc.
The mistakes or irregularities observed during the course of audit e.g. cases of failure to comply with the requirements of Companies Act or the provisions contained in the Memorandum or Articles, a change in the valuation of finished stock and work in progress or in the computation of depreciation, failure to provide adequate depreciation etc.
Unsatisfactory book-keeping arrangements, costing method, internal or financial administration or organization.
Important book-keeping arrangements, costing method, internal or financial administration or organization.
Special information about the company, which is not apparent from the accounts.
Special points requiring consideration at the time of finalizing accounts.
Important matter for future reference.