10+ Audit Assistant Interview Questions and Answers for Freshers

A provision for doubtful debt is a journal entry made to account for potential losses from customers who may not pay their debts.

• Provision for doubtful debt is recorded as an expense in the income statement.

• It is created by debiting the provision for doubtful debt account and crediting the bad debt expense account.

• The provision is based on an estimate of the amount of debt that is likely to become uncollectible.

• The provision is usually a percentage of the accounts receivable ...read more

Assertions and procedures for auditing debtors

• The existence assertion: ensuring that the debtors actually exist and are valid

• The completeness assertion: ensuring that all debtors are included in the financial statements

• The valuation assertion: ensuring that the debtors are valued correctly

• The rights and obligations assertion: ensuring that the company has the right to collect the debt and that the debtors have an obligation to pay

• The cutoff assertion: ensuring that all transa...read more

General precautions to be taken while auditing include ensuring independence, verifying evidence, and maintaining confidentiality.

• Maintain independence and objectivity throughout the audit process

• Verify evidence through documentation and testing

• Maintain confidentiality of all information obtained during the audit

• Ensure compliance with relevant laws, regulations, and standards

• Communicate effectively with auditee and management

• Document all findings and conclusions accurately

• Rev...read more

The 3 golden principles of accounting are: 1) Debit the receiver, credit the giver 2) Debit what comes in, credit what goes out 3) Debit expenses and losses, credit income and gains.

• Debit the receiver, credit the giver: when an asset is received, it is debited and when a liability is given, it is credited

• Debit what comes in, credit what goes out: when cash is received, it is debited and when cash is paid, it is credited

• Debit expenses and losses, credit income and gains: when ...read more

Types of GST include CGST, SGST, IGST, and UTGST.

• Central Goods and Services Tax (CGST) - levied by the central government on intra-state supplies

• State Goods and Services Tax (SGST) - levied by the state government on intra-state supplies

• Integrated Goods and Services Tax (IGST) - levied by the central government on inter-state supplies

• Union Territory Goods and Services Tax (UTGST) - levied by the union territories on intra-UT supplies

The rate of GST varies depending on the type of goods or services being taxed.

• GST rates are categorized into different slabs - 5%, 12%, 18%, and 28%.

• Some items are exempt from GST, while others may have a special rate like 0.25% or 3%.

• For example, essential items like food grains are taxed at 0%, while luxury items like cars may be taxed at 28%.

The rate of income tax varies depending on the individual's income level and tax laws of the country.

• Income tax rates are typically progressive, meaning higher income levels are taxed at higher rates.

• Tax rates can also vary based on filing status (single, married, etc.) and deductions/credits claimed.

• For example, in the United States, income tax rates range from 10% to 37% for individuals in 2021.

The 3 Golden rules of accounting are principles that guide the preparation of financial statements.

• 1. Revenue Recognition: Recognize revenue when it is earned, not when cash is received. Example: A company sells goods on credit, revenue is recognized at the time of sale.

• 2. Matching Principle: Match expenses with revenues in the period they are incurred. Example: If a company incurs expenses to produce goods, those expenses are matched with the revenue from selling those goods...read more

Yes, I thrive under pressure and am able to prioritize tasks effectively.

• I have experience working in fast-paced environments and have learned to remain calm and focused under pressure.

• I prioritize tasks based on urgency and importance, ensuring that deadlines are met.

• I communicate effectively with team members and superiors to ensure that everyone is on the same page and working towards the same goals.

• For example, during my previous internship, I was given a tight deadline t...read more

Audit procedures are conducted by planning, testing, evaluating, and reporting on the financial statements of a company.

• Planning phase involves understanding the client's business, assessing risks, and developing an audit plan.

• Testing phase includes gathering evidence, performing analytical procedures, and testing internal controls.

• Evaluation phase involves assessing the results of testing, forming conclusions, and issuing an audit report.

• Reporting phase includes communicatin...read more

Golden rules of accounting are basic principles that guide the process of recording financial transactions.

• There are three golden rules of accounting: Debit what comes in, Credit what goes out, Debit the receiver, Credit the giver, Debit expenses and losses, Credit income and gains.

• For example, when cash is received, it is debited because it is an asset that has increased. When cash is paid out, it is credited because it is an asset that has decreased.

• Similarly, when goods ar...read more

Depreciation is the allocation of the cost of a tangible asset over its useful life.

• Depreciation is a non-cash expense that reduces the value of an asset over time.

• It reflects the wear and tear, obsolescence, or decrease in value of the asset.

• Common methods of calculating depreciation include straight-line, double declining balance, and units of production.

• Example: A company purchases a delivery truck for $50,000 with a useful life of 5 years. Using straight-line depreciation...read more

Schedule III of the Companies Act provides the format for balance sheet and profit and loss account.

• Schedule III prescribes the minimum requirements for the presentation of financial statements of a company.

• It includes the format for balance sheet, statement of profit and loss, and notes to accounts.

• The schedule provides guidelines on the classification of assets, liabilities, and equity in the balance sheet.

• It also specifies the format for disclosing various financial inform...read more