CA Inter Auditing and Ethics MTP January 2026: Question Paper and Solutions

How to Prepare for CA Intermediate Auditing and Ethics

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Question directory and available solutions

49 indexed questions. Open a question to read its full statement and available answer.

1. CA Arun, a Chartered Accountant, is conducting the statutory audit of Preeti Textiles Ltd. for the financial year ending March 31, 2025. As part of…
2. The Comptroller and Auditor General of India (C&AG) deputed Mr. V. Sarkar, Chief Audit Officer, to conduct propriety audit of various departments of…
3. Great Point Ltd., a software development company, has been under pressure to meet aggressive market expectations for revenue growth. For the…
4. CA Meena is the statutory auditor of GLOW Ltd. Her husband has recently joined the company as CFO. CA Meena has undue dependence on professional…
5. During planning of an audit of XYZ Ltd., the engagement partner realises that complex valuation issues will arise. Accordingly, a valuation expert…
6. During audit of FAN Pvt. Ltd., the auditor finds that the company has defaulted on loan repayments and is unable to pay creditors on time. The…
7. Raman & Suman, Chartered Accountants, are the statutory auditors of Santosh Bank Ltd. The bank uses a centralized core banking system (CBS) for…
8. An established audit firm, 'ABC & Co.', is preparing to commence the statutory audit for its long-standing client, Nitin Handlooms Private Ltd. The…
9. Sameer & Co., Chartered Accountants, are conducting the audit of ABC Ltd. for the year ended 31st March, 2025. While testing accounts payable, the…
10. WXY Ltd. is a trading company that maintains a large quantity of inventory in its warehouse. During the year, some inventory items belonging to the…
11. During the audit of SITU Bank Ltd, the auditor reviews the loan portfolio and comes across the account of M/s Neem Tree Infrastructure Ltd., which…
12. An audit firm SPR &Co. is preparing the detailed audit plan for a new client, Rajeshwari Ltd. The overall audit strategy has already been…
13. During audit of Kavita Ltd., the auditor performs various audit procedures such as inspection, observation, confirmation, recalculation,…
14. During statutory audit of Orient Chemicals Ltd., the auditor, CA Raj, obtained an understanding of the company's internal control system as part of…
15. ABC Ltd. is a government company whose statutory audit is being carried out by auditors appointed on the advice of the Comptroller and Auditor…
16. Wonder Homes Pvt. Ltd. owns a commercial building divided into several apartments that are rented out. During the course of audit, the auditor…
17. As per SQC 1 - "The firm's system of quality control should include policies and procedures addressing each element." In this context, describe the…
18. Describe the essential contents of the "Basis for Opinion" section in an auditor's report and explain why this section is important as per the…
19. Sun and Moon Credit Co-operative Society Ltd., a large scale cooperative organisation operates in Maharashtra and engages in providing small loans…
20. During audit of PQR Ltd., the auditor observed that the company had incurred several types of expenditure in relation to its new manufacturing…
21. Explain the circumstances under which a professional accountant may depart from specific procedures prescribed in the Standards and describe the…
22. During an audit, the auditor becomes aware that management has imposed a limitation on the scope of the audit after the engagement was accepted.…
23. Hansa Airways has purchased a new aircraft for its fleet. The aircraft has an airframe and engines, both of which have significant cost in relation…
24. XYZ Ltd. finalized its financial statements for the year ended 31st March 2025. Audit is in progress and the auditor is expected to issue the report…
25. Explain the factors that determine the form, content, and extent of audit documentation as per the Standards on Auditing.
26. Samta Tools Pvt. Ltd. manufactures precision cutting tools. You are auditing the company for FY 2024-25. The company employs about 450 workers. The…
27. Madan Leasing Co. Ltd. is a non-banking leasing company that leases industrial machinery and consumer durables. During the current year, Madan…
28. Trimurti & Co., Chartered Accountants, are appointed as the statutory auditors of Techno Industries Ltd., a medium-sized manufacturing company…
29. A newly qualified Chartered Accountant, CA Riya is handling an assignment where no specific ethical rule is prescribed for a particular unusual…
30. An audit firm, RST & Co., conducted the statutory audit of Bluewing Traders Ltd. During the review of audit files by regulatory authority, it was…
31. During the audit of JKL Industries, the auditor identified certain significant deficiencies in the company's internal control system. Senior…
32. During audit of ABC Ltd., the audit team discussed the concept of audit risk. The engagement partner explained that audit risk is a function of the…
33. Bell Manufacturing Ltd. has undergone a restructuring during the current year resulting in changes in key personnel and ownership interests. The…
34. R & Co., Chartered Accountants, have been appointed as auditors of XYZ Ltd., a company operating in multiple business segments, including…
35. Ridham Enterprises, a trading firm, has shown a substantial amount under “Trade Payables and Other Current Liabilities" in its financial statements…
36. MNB Bank Ltd. is undergoing its statutory branch audit. During planning stage, engagement partner convened a meeting with audit team and a valuation…
37. Kiran Anupam & Associates, Chartered Accountants, are conducting statutory audit of ABC Ltd. for the F.Y 2024-25. During the audit, the engagement…
38. The auditor of Global Manufacturing Ltd. is planning to use Inspection as an audit procedure to achieve various audit objectives relating to the…
39. AB Ltd. is facing a temporary decline in sales due to adverse market conditions. However, the management has prepared future cash flow projections…
40. The office of the Comptroller and Auditor General (C&AG) undertook an Audit of Receipts in the Department of Indirect Taxes. During the audit, it…
41. FGH Ltd. has appointed you as the auditor for the financial year 2024-25. The company had a different auditor in the previous year. While planning…
42. Wing Ltd. has appointed CA G as its statutory auditor for FY 2024–25. During preliminary discussions, CA G observes that the company prepares…
43. SA 705, "Modifications to the Opinion in the Independent Auditor's Report,” deals with circumstances in which the auditor is required to modify the…
44. During audit of Himani Electronics Ltd., the auditor identifies that several purchase bills bearing proper stamps and signatures of authorised…
45. ABC Ltd. has several fixed deposits with different banks. During audit for the year 2024-25, the auditor notices that the interest income shown in…
46. Sunrise Degree College appointed you as the auditor for the FY 2024-25. During audit, you observed the following: (i). The Students' Fee Register…
47. SA 706 “Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent Auditor's Report" requires the auditor to include an Emphasis…
48. Sunrise Pharma Ltd. has incurred significant expenditure during the financial year 2024-25 on developing a new drug formula and also on purchasing…
49. State the auditor's responsibilities in relation to facts that become known to the auditor after the date of the auditor's report but before the…