Examine the qualification and qualities that an Auditor must possess.
Only the Chartered Accountants can be appointed as auditor of a limited company. He must have adequate skill and qualities to conduct his work efficiently.
- The auditor must have thorough knowledge of principles and practice of all aspects of accountancy. He must be familiar with all systems of accountancy in use. At he has to deal with different accountancy systems, he must understand their method of preparation.
- He has to be tactful because for certain transactions no or inadequate information may be available, he has to extract such information tactfully from his clients.
- He must have thorough knowledge of audit case laws as per the various cases decided by courts in and outside India. These decisions are helpful in conducting audits and determining the scope of his powers and duties.
- He must have up-to-date knowledge of Companies Act, Mercantile Laws.
- He must have thorough knowledge of Principles of Economics and Economic legislation’s because these affect the business whose accounts he has to audit.
- He must be familiar with Principles and Practices of Cost Accounting for performing Cost Audits.
- He should have adequate knowledge of financial management, industrial administration and business organisation.
- An auditor must be honest i.e. he must not certify what he doe S not believe to be true and he must take reasonable care and skill before he believes what he certifies is true.
- While discharging his duties, he must act impartially and not influenced by others directly or indirectly.
- He should be able to understand the technical details of business whose accounts he is going to audit. For this purpose he may make certain inquiries from the client as well as visit place of work.
- If circumstances of suspicion arise it is his duty to probe them to the bottom. This is the case when he comes to do his duty, he is bound to assume that he is dealing with fraudulent and dishonest people.
- From time to time he should seek clarification on the matters which he is not able to understand from the information provided to him,
- He should have high moral standards and should not accept and sign a report or statement which he does not believe to be true and fair.
- He should be hardworking, systematic and methodical.
- He must have capacity to hear arguments of others.
- He should not disclose the secrets of his client.
- He should have adequate skill and courage to write audit report correctly, clearly, concisely and forcefully.