B. M. Chatrath & Co Audit Executive Interview Questions and Answers

ECL provision is the estimated amount that a company sets aside to cover potential losses on its loans and other assets.

• ECL stands for Expected Credit Losses.

• It is a provision made by financial institutions to account for potential losses on loans and other financial assets.

• The provision is based on historical data, current economic conditions, and future expectations.

• ECL provision is required under accounting standard...read more

I will audit the Borrowing area by reviewing loan agreements, analyzing interest rates, and assessing compliance with borrowing policies.

• Review loan agreements to ensure terms are being followed

• Analyze interest rates to verify accuracy and reasonableness

• Assess compliance with borrowing policies to identify any violations or discrepancies

CARO 2016 focused on reporting requirements for companies, while CARO 2020 introduced additional reporting requirements and emphasized on fraud detection.

• CARO 2016 primarily focused on reporting requirements for companies.

• CARO 2020 introduced additional reporting requirements such as reporting on internal financial controls and fraud detection.

• CARO 2020 emphasized on the responsibility of auditors to detect and report ...read more

Deferred revenue refers to income received by a company in advance of earning it, resulting in a liability on the balance sheet.

• Deferred revenue is also known as unearned revenue.

• It is recorded as a liability on the balance sheet until the revenue is recognized.

• Common examples include magazine subscriptions, annual maintenance contracts, and advance payments for services.

• Once the revenue is earned, it is recognized on ...read more

Reconciling bank balances involves comparing the bank statement with the company's records to identify and resolve any discrepancies.

• Obtain the bank statement and compare it with the company's records of transactions.

• Identify any discrepancies such as missing deposits or withdrawals, bank errors, or outstanding checks.

• Adjust the company's records to match the bank statement by recording any necessary corrections.

• Ensure...read more

The three major activities in cash flow statement are operating activities, investing activities, and financing activities. Purchase of fixed assets would fall under investing activities, while repayment of loans would fall under financing activities.

• Operating activities involve cash flows from day-to-day business operations, such as sales and expenses.

• Investing activities include cash flows related to the purchase and...read more

The 5 steps of Revenue recognition are identification of the contract, identification of performance obligations, determination of transaction price, allocation of transaction price, and recognition of revenue as performance obligations are satisfied.

• Identification of the contract: Determine the existence of a contract with a customer.

• Identification of performance obligations: Identify the separate performance obligati...read more

I want to join Deloitte because of its reputation for providing excellent training and career development opportunities.

• Deloitte is known for its high-quality training programs which will help me develop my skills and knowledge in auditing.

• I am impressed by Deloitte's commitment to employee growth and advancement, which aligns with my career goals.

• I believe that working at Deloitte will provide me with the opportunity ...read more

Fixed assets are audited by verifying physical existence, ownership, valuation, and depreciation methods.

• Verify physical existence by conducting physical inventory counts.

• Confirm ownership by reviewing title deeds and purchase agreements.

• Ensure accurate valuation by comparing book value to market value.

• Review depreciation methods and calculations for accuracy.

• Check for impairment indicators and assess if any assets nee...read more