The Institute of Company Secretaries of India 2008 ICSI Final Secreterial Management and System Audit - Question Paper

(7 marks)
(c) Draw an audit programme for conducting operational audit of packaging process of toilet soap manufacturing company.
(6 marks)

6. (a) The quantity of sales of Gell Well Ltd. was comparable with its sales during the previous year. However, there was a considerable fall in its trading profit compared to the previous year. You are asked to investigate into the reasons of fall in profit. Outline the procedure.
(10 marks)
(b) part 231 of the Companies Act, 1956 provides that an Auditor of a company shall be entitled to receive notice of and to attend any general meeting of the company at which any accounts which have been examined and reported on by him are to be laid before the company and make any statement or explanation he desires with respect to the accounts. You are needed to ans the subsequent —
(i) In what circumstances should the right to make a statement or explanation be exercised by the Auditor ?
(ii) Would any explanation made by the Auditor relieve him in respect of omissions from the report or from the balance sheet ?
(iii) Should the Auditor so attending the AGM, ans ques. put-up by the shareholders ?
(iv) If the Auditor is current and any wrong info is provided by a director in regard to an item in the balance sheet, would it be proper for him to accurate that info in the absence of explanation by the director concerned ?
(v) Would the Auditor incur any liability for absenting himself from the AGM ? provide reasons for your ans.
(2 marks each)

7. (a) select the most improper ans from the provided choices in respect of the subsequent :
(i) The primary objective of info Systems Audit is to identify ––
(a) Critical IT processes
(b) Key IS risks
(c) IT controls
(d) Material control weaknesses.
(ii) The sequence of an info Systems Audit process is ––
(a) Review, evaluation, identification and documentation
(b) Identification, evaluation, compliance testing and substantive testing
(c) Review, evaluation, compliance testing and substantive testing
(d) Identification, compliance testing, substantive testing and valuation.
(iii) info Systems Audit is needed as ––
(a) IT is becoming more complex
(b) IT controls are inherently unreliable
(c) A tool for providing assurance to management
(d) IT security is inadequate.
(iv) The most critical control consideration in designing the audit procedures in a computerised environment is ––
(a) Lack of segregation of duties
(b) Lack of management control
(c) Lack of IT knowledge by staff operating the system
(d) On line and real-time nature of the system.
(1 mark each)

(b) Re-write the subsequent phrases after filling-up the blank spaces with improper word(s)/figure(s) :
(i) The slack resource will not be available to other application system if it is __________ to 1 system.
(ii) Analytic review of real data to test its quality by using certain audit software or packages are called _____________ tests.
(iii) Business continuity planning is a part of _________ controls.
(iv) In _________ attacks, the user is deluded to get into a few unwanted site by overriding the domain name service entries.
(1 mark each)

(c) State, with reasons in brief, whether the subsequent statements are accurate or incorrect. Attempt any 2 :
(i) The process of removing defects in a software programme is called fresh programme design.
(ii) Non-availability of source code is a serious handicap when software developed by 3rd parties is procured.
(iii) Switches/hubs lying loose on tables/hanging on walls is an illustration of lack of proper environmental controls.
(2 marks each)

(d) Comment on any 2 of the subsequent statements :
(i) The need for steering committee for security cannot be considered as of low priority.
(ii) The scope of systems audit covers the entire info systems management process.
(iii) Asset safeguarding is an important objective of info systems audit.
(4 marks each)
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Earning:   Approval pending.