“AUDIT”

An Internship report submitted I partial fulfillment of the requirements for the

award of the degree of Bachelor of commerce

Submitted by

RACHITHA.M

U18IP21C0167
2021-2024

SINDHI COLLEGE
Permanently affiliated to Bengaluru city university and Accredited by NAAC
Recognized by UGC under 2(f) & 12(B), ISO 9001:2015

33/2B, Kempapura Hebbal, Bangalore-560024

 INDEX

SL No Topics Page No

1 Declaration by the student 3

2 Acknowledgement 4

3 Organisation profile 5

4 Work description 5-11

5 GST –overview 12-17

6 Observation 18

7 Learning outcomes 19

8 Conclusion 20
 DECLARATION BY THE STUDENT

I hereby declare that this is my original work made personally during internship carried out
in MANISHANKAR AND ASSOCIATES for a period of 30 days. This internship fulfills the
requirement of “B.COM” degree of Bengaluru City University.

RACHITHA.M
 ACKNOWLEDGEMENT

I take this as an opportunity to express my profound to all who have been significant
contributors of this internship .

I express my deepest sense of gratitude to Professor. N. Asha ,Principal , Sindhi college for
the constant support rendered in fulfilment of the internship report.

I am thankful to Professor. Jayashree Tambad Head of Department, Commerce and

Management, Sindhi college for her constant support and guidance in completion of
internship report .

I am grateful to Assistant Professor. Kumar coordinator, B.com , Sindhi college for his
valuable time, guidance and encouragement.

I am also grateful for my guide Assistant Professor Shri Hari ,Sindhi College for guiding
me and providing me a valuable support.

I owe my gratitude to Manishankar Sivalanka, charted accountant for his constructive

criticism and constant encouragement during the course of my study.

Lastly I thank all my friends who helped me to complete this project.

Thank you
 ORGANISATIONAL PROFILE

Name of the employer: Manishankar Sivalanka

Address : No. 66, 1st floor, 14th main road,

Malleshwaram, Karnataka,Bengaluru-
560003.

Phone no : 8553168667

Email id :camanishankar.s@gmail.com

Works provided to the clients

• Maintenance of the accounts and preparation of Financial

Statements.
• Management of reports.

• Filling of Statutory Returns.

• Accounting supervision.

• GST registration and return filing.

 NOTE : Company profile attached

 BRIEF DESCRIPTION OF WORKS PERFORMED

Types of voucher

Sales Voucher (F8)

It is used to record sales. The sales voucher has purposes for both supplier and customer.
For the supplier, a copy of the voucher is normally left with the inventory to indicate that
it was purchased and paid for.

Purchase Voucher (F9)

Purchase Vouchers is used when you have to purchase some goods from any party and
you get an invoice against cash or credit purchase from the party.

Payment Voucher (F5)

The Payment Voucher (PV) authorizes the spending of money. You can use it to pay an
outside vendor or to transfer money within your entity.

Receipt Voucher (F6)

A Receipt voucher is used to record cash or bank receipt. Here there is an inflow of
funds.
Contra Voucher (F4)

A contra voucher is a set/group of two or more vouchers to record transactions within

the Establishment especially to record transactions for Cash to Bank or Withdrawal
from Bank

Journal Voucher (F7)

Journal voucher is a document of every financial transaction, having the necessary

information such as the identification number of the voucher, date, description of the
business transaction, etc

Credit Note Voucher (Ctrl + F8)

Credit note is a document issued to a party stating that account has been credited in
books of account for the stated reason or vice versa. It is commonly used in case of
sales return, escalation/ de –escalation in price.

Debit Note Voucher (Ctrl + F9)

Debit Note is a document/voucher given by a party to other party stating that such other
party's account is debited in the books of sender.
 HOW TO CREATE A COMPANY

Every company is created in tally for accounting purpose. Each and every company
is created with their name, mailing name, address, financial year, currency symbol. The
company details can be secured by the tally vault password.

To open Tally Software ……….. Double click on tally icon from your desktop ……...
Select Create Company from the Company Info. Menu using up and down arrow key
and press Enter Key………… select the path using Alt+D ……...... enter all the
details of the company that you been asked for…….. Enter to accept and save the
details.
 SPLIT COMPANY

You can split the company data at the end of the current financial year or at the beginning of
the next financial year when the data size becomes huge.

Go to Gateway of Tally > F3: Comp Info. > Split Company Data > Select
Company …….. Select the required company from the List of Companies
…….Enter the required date in the Split from field………Press Enter to split the company
data.
 ENTRY OF BANK STATEMENT IN TALLY

Every company has its own bank account. Large amounts of transactions such
payments from the creditors and payment to the debtors take place through bank. So it
is necessary to record this transactions.

Open tally-----select the company-------select balance sheet--------select current

assets---------select the bank A/c--------and select respective vouchers for respective
transactions……
Entries

• Cash Deposit Bank entry

Voucher type: Contra Voucher Shortcut Key - F4
entry:

Bank A/c (Dr)

To Cash (Cr)

• Cash withdrawal entry:

Cash A/c (Dr)

To Bank A/c (Cr)

• Bank entry for cheque Issued or given to a supplier entry:

Supplier A/c (Dr)
To Bank A/c (Cr)

• Payments
entry:

Dr the Expenses
Cr the Bank

• Receipt
entry:

Dr the Bank
Cr the Party
 Creation of ledger

Select company……………Account info ……….Ledger ……..create……..

Enter the name and select the respective group under which it comes. Tally
automatically creates two ledger accounts, i.e., Profit & Loss account and Cash in
Hand account. As per the requirements of the organization, we can create the ledger
accounts .
 Goods and services tax (GST)

Goods and Services Tax (GST) is an indirect tax (or consumption tax) used in India
on the supply of goods and services. Goods and services are divided into five
different tax slabs for collection of tax - 0%, 5%, 12%, 18% and 28%. From July 1,
2017, GST came up as single taxation system in India

AUDIT :

Vouching:-

Vouching is a technical term which refers to the inspection of documentary

evidence supporting and substantiating a transaction, by an auditor. It is the practice followed
in an audit, with the objective of establishing the authenticity of the transaction recorded in
the primary books of account. It essentially consists of verifying a transaction recorded in the
books of account with the relevant documentary and the authority on the basis of which the
entry has been made, also confirming that the authority on the basis of which the entry has
been made; also confirming that the amount mentioned in the voucher has been made; also
confirming that the amount mentioned In the voucher has been posted to an appropriate
account which would describe the nature of the transaction on its inclusion in the final
statements in account Vouching do not include valuation.

Verification:-Verification enables an auditor to confirm the result of Vouching about the

ownership or the existence of the assets and the liabilities.

TAXATION:-

Indirect (gst):

GST (goods and service tax) is a indirect tax levied on goods and services.

GST is a single tax on the supply of goods and services.

GST improve overall economic growth of the nation.

GST is a comprehensive indirect tax levy on manufacture, sale and consumption of goods as
well as services at the national level. It will replace all indirect taxes levied on goods and
services by states and central.
Direct (income tax) :-

Income Tax is a direct and single tax charged on the income of any person for a relevant
income year in relevant assessment year.

That means, in order to generate revenues, Government imposes tax on various areas. Of
them

Income Tax is the tax which is levied on the taxable income of a person or entity as per the

provisions of the income Tax Ordinance, 1984.

3) PROJECT FINANCING:-

The International Project Finance Association defines Project finance as “financing of long-
term infrastructure, industrial projects, power plant, etc., where project debt and equity used
to finance the project are paid back from the cash-flow generated by the project.”

The two key aspects of project financing are:

■ 1. The project revenues (cash flows) are expected to service debt or equity interest taken by
the providers of capital.

■ 2. The loans are secured by the project assets or, to the extent security interests are
restricted or have limited value, are secured by contingent support from sponsors and other
project participants

Tally Accounting:

Tally is most used accounting software. Small and medium sized business can take services
from CA firms who can allocate accountants to handle accounting for your business.

Tax Audit:

Tax Audit is requirement of Income Tax Act for companies large businesses Tax Audit
Report helps in compliance of income tax laws & highlights key tax related information
Experienced CA firms can help in reducing non-compliance of income tax laws.
 Difference between auditing & accounting:

Several customers and members confuse with accounting and auditing, because maximum
auditing is concerned with accounting information also many auditors have considerable
expertise in accounting matters.of Accounting the system of recording and summarizing
business and financial transaction and analyzing, verifying, and reporting the results of
financial information for decision making. It’s provides service to an entity.

Financial auditing is the process of examining an organization’s (or individual) financial

records to determine if they are accurate and in accordance with any applicable rules
(including accepted accounting standards), regulations, and laws.

Auditing is the process of examining an organization’s (or individual) financial records to

determine if they are accurate and in accordance with any applicable rules (including
accepted accounting standards, regulation, and laws. From the point view of the audit of
financial statements, these are generally accepted accounting principles (GAAP).
 Requirements of an Effective Audit:

In order for an audit to be completed properly, auditor must contain certain attributes. Such
as:

 Auditor must have a thorough understanding of the entity being audited and the industry of

which it is a part.

 The auditor must also have a comprehensive knowledge of GAAP in order to audit

effectively.

 A solid grasp of concepts of internal control and a careful review and evaluation of internal

accounting controls are also necessary ingredients to an effective audit.

 In addition to understanding the company, GAAP, and internal control, the auditor must
also

be knowledgeable in the area of evidence gathering and evaluation.

According to Taylor and Glezen, 1979, to become a chartered accountant, a person must
fulfill the following requirements:

 An Educational Requirement

 An Experience Requirement
 Communicating the audit result:-

At the last stage of the audit, the audit team communicates the audit result to the Trustee and
the Stakeholders of the fund. The auditor should review and assess the conclusion drawn
from the audit evidence obtained during the course of the audit. Before finalizing the audit the
audit report the following formalities are maintained which are as follows.

a) Draft Audit Report

On evaluation and finalization of audit findings the audit firm communicates the audit report
to the clients in draft form to the clients.

b) Discussion of Audit Report With Exit Meeting

After preparation of draft audit report the audit firm documents all the matters, which are
important in providing guidance that the audit are carried out with the basic principles of
auditing. Then the firm discuses with the clients the audit findings at an exit meeting
presented in the audit report .Firm invites comments on findings from the management and
documents therein and documents the comments given by the client.

c) Finalizing the Audit Report

After making final amendments the firm submits the final report to the clients with the
auditors’ report.

Specific accounts risk analysis:-

Sometimes verification of all accounts won’t be easy because of time constraint.then it is

urgent for the audit team to analyse the risk assesment of some specific accounts.these can
be :

• Accounts Receivable
• Accounts Payables
• Non current Assets
• Inventory
• Cash and Cash equivalents
• Retained Earnings
• Tax and Vat
• Non current Loan etc.
 MY OBSERVATION:-

 Meaning and understanding the responsibilities

 Necessity of Commitment

 Accumulated valuable work related skills

 Gained and understanding and become comfortable with professional work environment
expectation and social norms
 LEARNING OUTCOMES

 Knowledge about accounting works in tally, how to use Tally software.

 Creation of ledger and posting entries of bank statement in Tally.
 Making entries of purchases and sales bill.
 Splitting company data and creating company.
 Posting of opening balance in tally.
 Improve communication skills, communicating with Proffessionals.
 Getting practical experience in a real life, assess interests and abilities in this field .
 Plan for future and how to adjust in an organisation.
 CONCLUSION

1.After working on this project its my immense pleasure to say that it has been most
beneficial to me as it gave a lot of knowledge about the Finance.

2.The Internship program with MANISHANKAR &ASSOCIATES was a good learning

experience and a first step in the Corporate world.

3. MANISHANKAR & ASSOCIATES is overall one of the profit making and reputed firm .

4.The organization since its very first day is devoted to providing quality services.

5.The detailed and through review of work and clients’ trust shows the perfection with which
it is working.