DECLARATION

I THEJU.S, a student of Master of Business Administration in Finance at JSS Centre for Management
Studies, JSS Technical Institution Campus, Mysuru. I, hereby, declare that this internship report
entitled “HARISH & CO” is a record of an original and independent work carried out by me during the
year 2020- 2022, In my III semester of the course under the guidance of ABHILASH, Associate
Professor JSS Centre for Management Studies, Mysuru, submitted to JSS SCIENCE AND TECHNOLOGY
UNIVERSITY, MYSURU in the partial fulfillment of the requirements for the award of Master of
Business Administration.

I further declare that this work and report has not formed the basis for the award of any other
diploma or degree of any institution or university.

Date: 18/01/2022 THEJU.S

Place: Mysuru USN: 01JST20PMB111

ACKNOWLEDGEMENT

Any presentation completed successfully gives a great sense of achievement and satisfaction. The
report presentation would remain incomplete if the people who made it possible and whose
constant guidance and encouragement go without mention.

I would like to express my gratitude to Dr. S B Kivade, Principal, Sri Jayachamarajendra College of
Engineering Mysuru. For always being a great source of inspiration for providing me a congenial
environment for carrying out the Internship.

I would also like to express my gratitude to Dr SWAROOPA SIMHA, Professor and dean, JSS Centre
for Management Studies Mysuru, for always being a great source of inspiration for providing me a
congenial environment for carrying out the Internship.

I express my heart filled thanks to Abhilash Puttabuddhi, Associate Professor, JSS Centre for
Management Studies Mysuru who is also my Internship guide. Her constant support, inspiring
guidance and persistent help has provided useful insights into the issues being addressed in the
Internship at various stages during its execution. Her guidance and support go beyond words.

I would like to thank my parents and friends for their cooperation and God, the Almighty, for his
blessings and strength.

THEJU.S

USN: 01JST20PMB111

JSS Centre for Management Studies,

Mysuru – 570 006

CERTIFICATE

This is to certify that, THEJU.S (USN: 01JST20PMB111), a student of Master of Business

Administration in Corporate Finance at JSS Centre for Management Studies, JSS Technical Institution
Campus, Mysuru, India, has carried out an internship and submitted a report on “HARISH &CO” in
partial fulfillment of the requirements of the award of MASTER OF BUSINESSES ADMINISTRATION.

MS. THEJU.S, has worked under my guidance and the report is recommended for submission.

Abhilash.P

DATE: 09/01/2021 Associate Professor

PLACE: Mysuru Department of JSS CMS JSS Science and

TechnologyUniversity

Mysuru – 570 006

HARISH GOWDA & CO

HEAD OFFICE:

1. Harish Gowda & Co.,RSR Complex,2nd Floor,Near KSFC Building,R.C.Road, Hassan

BRANCHES:

1. Arsikere Urban Bank, Arsikere

2. Belur Urban Bank, Belur

FIRM REGISTRATION NUM: 225173

E MAIL ca.harishgowda@gmail.com PHONE NUMBER: +91 9663384636

TABLE OF CONTENT

1. Introduction of HARISH GOWDA & C0

2. Services

3. SWOT Analysis of firm

4. Overview of Work

5. Learning

Chapter 1

INTRODUCTION OF THE FIRM:

 HARISH GOWDA AND CO is a Private company incorporated on Monday, 01 january 1900.It
is classified as non-government company and us registered at registrar of companies,HASSAN
Director is HARISH GOWDA D. We are an indian chartered accountant firm based in Ksfc Building
Hassan. We provide all sort of chartered accountant services related to accounting, auditing, income
tax, financial services, company law matters, foreign collaborations, import-export consultancy, GST
Registration, GST Returns, STPI, Transfer Pricing related matters etc. In order to meet the specific
requirements of the clients, we provide the best possible solution and consultancy for their
respective matters.With the active support we receive from our competent team of professionals,
we have managed to provide the effective services to our various esteemed clients.

ABOUT THE PARTNERS:

We have dedicated & experienced team of chartered accountants & other professionals
which is committed to provide you world class CA services. Out of our total headcount of 5, we have
2 chartered accountants who will be closely working with you and team to ensure that you get
satisfactory services

INTRODUCTION- An Overview Of Auditng

Economic decisions in every society must be based upon the information available at the
time the decision is made. For example, the decision of a bank to make a loan to a business is based
upon previous financial relationships with that business, the financial condition of the company as
reflected by its financial statements and other factors. If decisions are to be consistent with the
intention of the decision makers, the information used in the decision process must be reliable.
Unreliable information can cause inefficient use of resources to the detriment of the society and to
the decision makers themselves. In the lending decision example, assume that the barfly makes the
loan on the basis of misleading financial statements and the borrower Company is ultimately unable
to repay. As a result the bank has lost both the principal and the interest. In addition, another
company that could have used the funds effectively was deprived of the money. As society become
more complex, there is an increased likelihood that unreliable information will be provided to
decision makers. There are several reasons for this: remoteness of information, voluminous data and
the existence of complex exchange transactions 3 As a means of overcoming the problem of
unreliable information, the decision-maker must develop a method of assuring him that the
information is sufficiently reliable for these decisions. In doing this he must weigh the cost of
obtaining more reliable information against the expected benefits. A common way to obtain such
reliable information is to have some type of verification (audit) performed by independent persons.
The audited information is then used in the decision making process on the assumption that it is
reasonably complete, accurate and unbiased.
FEATURES OF AUDITING

(Type in an explanation)

• Audit is a systematic and scientific examination of the books of accounts of a business;

• Audit is undertaken by an independent person or body of persons who are duly qualified for
the job.

• Audit is a verification of the results shown by the profit and loss account and the state of
affairs as shown by the balance sheet.

• Audit is a critical review of the system of accounting and internal control.

• Audit is done with the help of vouchers, documents, information and explanations received
from the authorities. 6

• The auditor has to satisfy himself with the authenticity of the financial statements and
report that they exhibit a true and fair view of the state of affairs of the concern.

• The auditor has to inspect, compare, check, review, scrutinize the vouchers supporting the
transactions and examine correspondence, minute books of share holders, directors, Memorandum
of Association and Articles of association etc., in order to establish correctness of the books of
accounts.

OBJECTIVES OF AUDITING

There are two main objectives of auditing. The primary objective and the secondary or
incidental objective. a. Primary objective – as per Section 227 of the Companies Act 1956, the
primary duty (objective) of the auditor is to report to the owners whether the balance sheet gives a
true and fair view of the Company’s state of affairs and the profit and loss A/c gives a correct figure
of profit of loss for the financial year. b. Secondary objective – it is also called the incidental
objective as it is incidental to the satisfaction of the main objective. The incidental objective of
auditing are:

i. Detection and prevention of Frauds

ii. Detection and prevention of Errors. Detection of material frauds and errors as an incidental
objective of independent financial auditing flows from the main objective of determining whether or
not the financial statements give a true and fair view. As the Statement on auditing Practices issued
by the Institute of Chartered Accountants of India states, an auditor should bear in mind the
possibility of the existence of frauds or errors in the accounts under audit since they may cause the
financial position to be mis-stated. Fraud refers to intentional misrepresentation of financial
information with the intention to deceive. Frauds can take place in the form of manipulation of
accounts, misappropriation of cash and misappropriation of goods. It is of great importance for the
auditor to detect any frauds, and prevent their recurrence. Errors refer to unintentional mistake in
the financial information arising on account of ignorance of accounting principles i.e. principle
errors, or error arising out of negligence of accounting staff i.e. Clerical errors.
BASIC PRINCIPLES OF AUDIT

AAS-1 describes the basic principles, which govern the auditor's professional responsibilities and
which should be complied with whenever an audit is carried out. These are:-

1. Integrity, objectivity and independence: The auditor should be straightforward, honest and
sincere in his approach to his professional work. He must be fair and must not allow prejudice or bias
to override his objectivity. He should maintain an impartial attitude and appear to be free of any
interest which might be regarded. Whatever it's actual effect, as being incompatible with integrity
and objectivity.

2. Confidentiality: The auditor should respect the confidentiality of information acquired in the
course of his work and should not disclose any such information to a third party without specific
authority or unless there is legal or professional duty to disclose. It is remarked that an auditor
should keep his ears and eyes open but his mouth shut.

3. Skill and competence: The audit should be performed and the report prepared with due
professional care by persons who have adequate training, experience and competence. This can be
acquired through a combination of general education, technical knowledge obtained through study
and formal courses concluded by a qualifying 37 examination recognized for this purpose and
practical experience under proper supervision.

4. Work performed by others: When the auditor delegates work to assistant* or uses work
performed by other auditors or experts, he will continue to be responsible for forming and
expressing his opinion on the financial information. At the same time he is entitled to rely on work
performed by others provided he exercises adequate skills and care and is not aware of any reason
to believe that he should not have relied. The auditor should carefully direct, supervise & review
work delegated by assistants. He should obtain reasonable assurance that work performed by other
auditors or experts is adequate for this purpose.

5. Documentation: The auditor should document matters, which are important in providing evidence
that the audit was carried out in accordance with the basic principles.

6. Planning: The auditor should plan his work to enable him to conduct an effective audit in an
efficient and timely manner. Plans should be based on knowledge of client's business. They should
be further developed and revised, if required, during the course of audit.

7. Audit evidence: The auditor should obtain sufficient appropriate audit evidence through the
performance of compliance and substantive test procedure. It will enable him to draw reasonable
conclusions there from on which he has to base his opinion on the financial information.

8. Accounting system & internal control: The auditor should gain an understanding of the accounting
system and related internal controls. He should study and evaluate the operation of those internal
controls upon which he wishes to rely in determining the nature, timing and extent of other audit
procedures.

9. Audit conclusions and reporting: The auditor should review and assess the conclusions drawn
from the audit evidence obtained and from his knowledge of business of the entity as the basis for
the expression of his opinion on the financial information. 38 The audit report should contain a
written expression of opinion of the financial information. It should comply with the legal
requirements. In case of a qualified opinion, adverse opinion or disclaimer of opinion is given or
reservation on any matter is to be made reasons thereof.
AUDIT TYPES MEANING:

Audit is not legally obligatory for all types of business organizations or institutions. On this basis
audits may be of two broad categories i.e., audit required under law and voluntary audits.

(i) Audit required under law : The organizations which require audit under law are the following:

(a) companies governed by the Companies Act, 1956;

(b) banking companies governed by the Banking Regulation Act, 1949;

(c) electricity supply companies governed by the Electricity supply Act, 1948;

(d) co-operative societies registered under the co-operative Societies Act, 1912;

(e) public and charitable trusts registered under various Religious and Endowment Acts;

(f) corporations set up under an Act of parliament or State Legislature such as the Life Insurance
Corporation of India.

(g) Specified entities under various sections of the Income-tax Act, 1961.

(ii) In the voluntary category are the audits of the accounts of proprietary entities, partnership firms,
Hindu undivided families, etc. in respect of such accounts, there is no basic legal requirement of
audit. Many of such enterprises as a matter of internal rules require audit. Some may be required to
get their accounts audited on the directives of Government for various purpose like sanction of
grants, loans, etc. But the important motive for getting accounts audited lies in the advantages that
follow from an independent professional audit. This is perhaps the reason why large numbers of
proprietary and partnership business get their accounts audited. Government companies have some
special feature which will be seen later.

INTERIM AUDIT: An audit that is taken up between two annual audits is called an Interim Audit. A
specific date, as per the client’s requirement is taken into account, e.g. 30th September, 31st
December, etc. a trial balance is drawn and verified with a view to prepare financial statement.
Financial statement are prepared and authenticated for the interim audit period. Assets and
liabilities are verified for interim 39 balance sheet purposes. Independence is considered less
independent than the statutory Auditor; generally an employee of the enterprise will be the internal
auditor. In the interim audit no format is prescribed. It depends on the nature of work, coverage and
audit observations.

CONTINUOUS AUDIT: A continuous audit is one in which the auditor’s staff is engaged continuously
in checking the accounts of the client, during the whole year round or when for the purpose, the
staff attends at quite frequent intervals say weekly basis during the financial period. A continuous
audit is preferred for the following reasons:

i. It makes it possible for the management to exercise a stricter control over the accounts in as
much as one is able to check sooner the causes of any errors of frauds uncovered by such an audit.

ii. The frequent attendance by the staff deters persons so inclined, from committing a fraud.

iii. The accounting staff of the client is motivated to keep the books of account up-to-day.
QUALITIES OF AN AUDITOR

So far we have discussed the question of formal qualifications of an auditor. But it is not enough to
realise what an auditor should be. He is concerned with the reporting on financial matters of
business and other institutions. Financial matters inherently are to be set with the problems of
human fallibility; errors and frauds are frequent. The qualities required, according to Dicksee, are
tact, caution, firmness, good temper, integrity, discretion, industry, judgment, patience, clear
headedness and reliability. In short, all those personal qualities that goes to make a good
businessman contribute to the making of a good auditor. In addition, he must have the shine of
culture for attaining a great height. He must have the highest degree of integrity backed by adequate
independence. In fact, AAS-1 mentions integrity, objectivity and independence as one of the basic
principles. He must have a thorough knowledge of the general principles of law which govern
matters with which he is likely to be in intimate contact. The Companies Act, 1956 and the
Partnership Act, 1932 need special mention but mercantile law, specially the law relating to
contracts, is no less important. Needless to say, where undertakings are governed by a special
statute, its knowledge will be imperative; in addition, a sound knowledge of the law and practice of
taxation is unavoidable.

He must pursue an intensive programme of theoretical education in subjects like financial and
management accounting, general management, business and corporate laws, computers and
information systems, taxation, economics, etc. Both practical training and theoretical education are
equally necessary for the development of professional competence of an auditor for undertaking
any kind of audit assignment.

The auditor should be equipped not only with a sufficient knowledge of the way in which business
generally is conducted but also with an understanding of the special features peculiar to a particular
business whose accounts are under audit.On ‘Audit Planning’ emphasises that an auditor should
have adequate knowledge of the client’s business. The auditor, who holds a position of trust, must
have the basic human qualities apart from the technical requirement of professional training and
education.

He is called upon constantly to critically review financial statements and it is obviously useless for
him to attempt that task unless his own knowledge is that of an expert. An exhaustive knowledge of
accounting in all its branches is the sine qua non of the practice of auditing. He must know
thoroughly all accounting principles and techniques.

Auditing is a profession calling for wide variety of knowledge to which no one has yet set a limit; the
most useful part of the knowledge is probably that which cannot be learnt from books because its
acquisition depends on the alertness of the mind in applying to ever varying circumstances, the fruits
of his own observation and reflection; only he who is endowed with common sense in adequate
measure can achieve it.

Lord Justice Lindley in the course of the judgment in the famous London & General Bank case had
succinctly summed up the overall view of what an auditor should be as regards the personal
qualities. He said, “an auditor must be honest that is, he must not certify what he does not believe
to be true and must take reasonable care and skill before he believes that what he certifies is true”.

RISK OF FRAUD AND ERROR IN AUDIT

The following events may increase the risk of fraud or error -

1. Internal Control Faults: Weaknesses in the design of internal control system and non-compliance
with laid down control procedures, e.g. a single person being responsible for receipt of all pasts/
mails and marking it ti the relevant secions or two persons responsible for receipt of all posts/ mails
but the same is not followed in the practice.

2.Doubts about the integrity or competence of the management, e.g. domination by one person,
high rate of employee turnover, frequent change of legal counselsof Auditors, significant and
prolonged understaffing of the accounts department, etc.

3.Unusual pressures within the entity, e.g. industry is doing well but the Company's performance is
poor, heavy dependence on a single line of product, inadequate working capital, need to show more
profit to support the share market price, etc.

4.Unusual transactions e.g. transactions with related parties, excessive payment for certain services
to lawyers, etc.

5.Problems in obtaining sufficient and appropriate audit evidence, E.g. inadequate documentation
significant differences between the figures as per accounting records and confirmation received
from third parties. Etc.

AUDITOR’S DUTIES AND RESPONSIBILITIES IN RESPECT OF FRAUD

The primary objective of an auditor is to express an opinion on the financial statements. However,
the auditor while conducting the audit is required to consider the risk of material misstatements in
the financial statements resulting from fraud or error.

An audit conducted in accordance with the auditing standards generally accepted in India is
designed to provide reasonable assurance that the financial statements taken as a whole are free
from material misstatement, whether caused by fraud or error. The fact that an audit is carried out
may act as a deterrent, but the auditor is not and cannot be held responsible for the prevention of
fraud and error.

The auditor’s opinion on the financial statements is based on the concept of obtaining reasonable
assurance; hence, in an audit, the auditor does not guarantee that material misstatements, whether
from fraud or error, will be detected. Therefore, the subsequent discovery of a material
misstatement pf the financial statement resulting from fraud or error does not, in and of itself,
indicates:

a) Failure to obtain reasonable assurance,

b) Inadequate planning, performance or judgment,

c) Absence of professional competence and due care, or,

d) Failure to comply with auditing standards generally accepted in India.

This is particularly the case for certain kinds of intentional misstatements, since auditing procedures
may be ineffective for detecting an intentional misstatement that is concealed through collusion
between or among one or more individuals among management. Those charged with governance,
employees, or third parties, or involves falsified documentation. Whether the auditor has performed
an audit in accordance with auditing standards generally accepted in India is determined by the
adequacy of the audit procedures performed in the circumstances and the suitability of the auditor’s
reports based on the result of these procedures.

In planning and performing his examination the auditor should take into consideration the risk of
material misstatements of the financial information caused by fraud or error. He should inquire with
the management as to any fraud or significant error. Which has occurred in the reporting period,
and modify his audit procedures, if 36 necessary. If circumstances indicate the possible existence of
fraud and error, the auditor should consider the potential effect of the suspected fraud and error on
the financial information. If he is unable to obtain evidence to confirm, he should consider the
relevant laws and regulations before expressing his opinion.

The auditor also has the responsibility to communicate the misstatement to the appropriate level of
management on a timely basis and consider the need to report to it then changed with governance.
He may also obtain legal advice before reporting on the financial information or before withdrawing
from the engagement. The auditor should satisfy himself that the effect of fraud is properly reflected
in the financial information or the error is corrected in case the modified procedures performed by
the auditor confirm the existence of the fraud.

The auditor should also consider the implications of the frauds and errors, and frame his report
appropriately. In case of a significant fraud, the same should be disclosed in the financial statement.
If adequate is not made, there should be a suitable disclosure in his audit report.

SERVICES OFFERED:

Company Registration
The most famous business composition is to register a Pvt. Ltd. company. Company registration will
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DIN & check name availability of Company.

One Person Company

Register one person company for quick start of your business within reasonable fees by experienced
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LLP Registration

Limited liability partnership has benefit of company registration & easiness of partnership. Apt for
small businesses. Experienced CA firms can ease out the process within reasonable fees.

GST Registration

GST registration of business to sell goods beyond turnover limit. Limit may differ from state to state.
Necessary to get GST credit. Experienced CA firms can ease out the process within reasonable fees.

Project Financing

Need fund to grow your business. Experienced CA can prepare project report for loan financing to
ensure that you get most eligible amount in the shortest time. Generally, fees as % of finance
amount.

ROC Filing

Periodic returns / forms need to be submitted to registrar of companies (ROC) for companies act
compliance. Experienced CA firms can file timely & correct ROC filing in reasonable overall cost.

GST Returns

GST returns need to be filed on periodic basis by business to provide information about value of
turnover & total GST liability & mode of payment. Frequency may differ from state to state. Delays
will attract penalty. Experienced CA firms can ensure compliance within reasonable fees.

TDS Returns

Income tax act requires TDS (Tax Deducted at Source) deductor file the TDS return on periodic basis
by mentioning TAN No.

Income Tax (Salaried)

Income tax return of salaried employee can be filed with help of Form 16 & Form 16A. Form 26 AS
will help you in getting information about TDS on salary. Experienced CA firm can help you for better
tax planning and reduce the TDS.

Income Tax (Business)

Income Tax return filling is requirement of Income Tax Act for companies / businesses. Tax Audit
Report helps in compliance of income tax laws. Experienced CA firms can help in reducing non-
compliance of income tax laws.

Tally Accounting

Tally is most used accounting software. Small & medium sized business can take services from CA
firms who can allocate accountants to handle accounting of your business

Statutory Audit

Get the Statutory Audit of your company under Companies Act from experienced CA firms. Statutory
Audit is compulsory for any type of company.

Tax Audit

Tax Audit is requirement of Income Tax Act for companies / large businesses. Tax Audit Report helps
in compliance of income tax laws & highlights key tax related information. Experienced CA firms can
help in reducing non-compliance of income tax laws.

Internal Audit

Internal Audit & Internal Financial Control Testing is needed as per Companies Act. Internal Audit is
NOT as compulsory as Statutory Audit. Internal auditor can add value to your business to arrest
leakage & improve control & efficiency.
SWOT ANALYSIS

SWOT that stands for Strength, Weakness, Opportunity and Threats. It is intended to identify the
internal and external factors that are favorable and unfavorable to achieving the objectives of the
venture or project. SWOT has been described as a tried-and-true tool of strategic analysis,but has
also been criticized for its limitations, and alternatives have been developed.Here am presenting the
SWOT analysis of HARISH & CO CHARTERED ACCOUNTANTS.

Strengths:-

1. Goodwill in Public Mind

2. Capacity to handle various types of task simultaneously

3. Performance in typical situations

4. High speed

Weakness:-

1. Overloaded work.

2. Lack of day to day time management.

3. Due to overloaded work, the concentration lacks.

Opportunities:-

1. Tax auditing

2. Internal auditing

3. Consultancy

Threats:-

1. Lacking time management

2. High level of competition

 STRUCTURE OF THE FIRM

Harish Gowda and Co

Chartered Accountant

Partners

First Partner
OVERVIEW OF GST

It is a destination based tax on consumption of goods and services. It is proposed to be levied at all
stages right from manufacture up to final consumption with credit of taxes paid at previous stages
available as set off. In a nutshell, only value addition will be taxed and burden of tax is to be borne by
the final consumer.

OBJECTIVES OF GST

1. To achieve the ideology of 'One Nation, One Tax' ...

2. To subsume a majority of the indirect taxes in India. ...

3. To eliminate the cascading effect of taxes. ...

4. To curb tax evasion. ...

5. To increase the taxpayer base. ...

6. Online procedures for ease of doing business. ...

7. An improved logistics and distribution system.

FEATURES OF GST

1. Subsuming of 17 taxes at Central/States level.

2. Consumption Based Tax.

3. One Tax rate across the country.

4. Taxable event – “Supply of Goods or Services”

5. No differentiation in Goods or Services.

6. Comprehensive tax on Goods & Services.

7. No tax on tax.

8. Free flow of credit.

GST HISTORY

The implementation of the Goods and Services Tax (GST) in India was a historical move, as it marked
a significant indirect tax reform in the country. The amalgamation of a large number of taxes (levied
at a central and state level) into a single tax is expected to have big advantages. One of the most
important benefit of the move is the mitigation of double taxation or the elimination of the
cascading effect of taxation. The initiative is now paving the way for a common national market.
Indian goods are also expected to be more competitive in international and domestic markets post
GST implementation.

2000: In India, the idea of adopting GST was first suggested by the Atal Bihari Vajpayee Government
in 2000. The state finance ministers formed an Empowered Committee (EC) to create a structure for
GST, based on their experience in designing State VAT. Dasgupta chaired the committee till 2011.

From the viewpoint of the consumer, there would be a marked reduction in the overall tax burden
that is currently in the range of 25% to 30%. The GST, due to its self-policing and transparent nature,
is also easier to administer on an overall scale.
TYPES OF GST

1. Integrated Goods and Services Tax (IGST)

2. State Goods and Services Tax (SGST)

3. Central Goods and Services Tax (CGST)

VOUCHING

Vouching is a technical term that refers to the inspection of documentary evidence supporting and
substantiating a financial transaction, by an auditor. It is the essence of auditing

Vouching is the practice followed in an audit, with the objective of establishing the authenticity of
the transactions recorded in the primary books of account. It essentially consists of verifying a
transaction recorded in the books of account with the relevant documentary evidence and the
authority on the basis of which the entry has been made; also confirming that the amount
mentioned in the voucher has been posted to an appropriate account which would disclose the
nature of the transaction on its inclusion in the final statements of account. Vouching does not
include valuation.

Vouching can be described as the essence or backbone of auditing. The success of an audit depends
on the thoroughness with which vouching is done. After entering in all vouchers, only then can
auditing start. Vouching is defined as the "verification of entries in the books of account by
examination of documentary evidence or vouchers, such as invoices, debit and credit notes,
statements, receipts, etc.

Vouching is the essence or backbone of auditing because when performing an audit, an auditor must
have proof of all transactions. Without the proof provided by vouching, the claims provided by the
auditor are just that, only claims. In most cases, hard to detect frauds can only be discovered
through the use of vouching. This means that the auditor must conduct vouching with great
importance, if not, he can be charged with negligence which happened in the case of Armitage v.
Brewer and Knott.

Through this case, the importance of vouching was realized. In this case, the auditors were found to
be guilty on negligence, because the auditors did not display enough reasonable care and skill in
vouching the wage sheets and ended up failing to detect fraud in manipulation of these wage
records and cash vouchers. When delivering the decision the Judge stated that "It was clear that a
good many documents were suspicious on either face and called for Inquiry". It was declared that it
was essential that due care and attention are to be given to vouching in auditing.

VOUCHER

A voucher is nothing but a written or printed piece of documentary evidence, which authenticate the
transactions, i.e. it proves that the entries made in the books of accounts are real and genuine.

OBJECTIVE

1. To check whether all the business transactions are properly recorded in the books of
accounts or not.

2. To see whether recorded transactions are duly in supported by documentary evidence or

not.

3. To verify that all the documentary evidence is authenticated and related to business
transactions only.

4. To verify that transactions are free from errors or frauds.

5. To verify whether voucher is processed through all the stages of Internal Check system
properly.

6. To verify and confirm that the entries are recorded according to the capital and the revenue
nature or not.

7. To check the accuracy of accounting transactions.

IMPORTANCE
 Vouching forms the base for auditing and has an important part of Auditor’s duty. In case of
negligence in vouching, the Auditor will be held responsible; he cannot escape from his duty, if he
has done vouching carelessly. Following points show the importance of vouching −

 Vouching is equally important as passing of original entry in the books of accounts. If,
original entry is wrong, it will affect every process of accounting entry and its impact will be till the
end result. Similarly, vouching is base of all auditing process.

 Efficiency of vouching will decide the success of audit.

 Any errors and frauds are easily detectable if vouching is conducting in searching and
intelligent manner.

 Intelligent and faithful vouching will establish reliability on financial statements, i.e., Profit
and Loss account and Balance Sheet of any organization.

 If adequate internal control system exists, the Auditor may choose to do test checking
instead of complete vouching.

TYPES OF VOUCHERS

There are two types of vouchers −

Primary Voucher − Original copy of written supporting document is called primary voucher. Like
purchase Bill, cash memo, pay-in-slip, etc.

Collateral Voucher − Copies of supporting documents which are not available in original are
collateral voucher like duplicate or carbon copy of sale invoice.

IMPORTANT POINTS REGARDING VOUCHING

 Following points need to be considered regarding vouching −

 Accuracy of transactions.

 Authenticity of transactions.
 Proper classification of accounts.

 Voucher should be properly numbered serially and arrangement of vouchers accordingly.

 Every checked voucher should be tick marked with sign.

 Amount of receipt should be same in words and in figure.

 Period of payment should be there on receipt.

 Receipt should clearly mention “advance payment” if it is do.

 To check and investigate the books of accounts if they are in the name of Director, Manager,
Partner or any other employee of the company.

 To verify that proper certification of voucher should be there by any responsible officer of
the company.

 Investigation about missing vouchers in file if any.

 Every alteration in voucher must be authenticated by concerned officer.

 Vouching should be complete at once in one sitting for a particular period of time.

 All the expenses should be examined by the Auditor.

TAX AUDIT:

A tax audit is an examination of your tax return by the IRS to verify that your income and deductions
are accurate. A tax audit is when the IRS decides to examine your tax return a little more closely and
verify that your income and deductions are accurate.

OBJECTIVE OF AUDIT:
It is conducted to report the requirements of Forms - 3CA/3CB and 3CD, which the tax auditor has to
present in front of the tax authority.

Proper maintenance of the book of accounts and other similar records is another such objective of
tax audits.

It is also done to get a proper record about the income of the taxpayers as well as their tax
deductions.

Tax audits are conducted to facilitate the administration of tax laws by presenting the accounts
properly in front of authorities.

Another objective of tax audits is saving verification time. Tax Audits help save time that is taken
during routine verification, which is an even more tedious procedure than auditing

GSTR-1

GSTR-1 is a monthly or quarterly return that should be filed by every registered GST taxpayer,
except a few as given in further sections. It contains details of all outward supplies i.e sales.

When is GSTR-1 due?

The due dates for GSTR-1 are based on your turnover. Businesses with sales of up to Rs.5 crore have
an option to file quarterly returns under the QRMP scheme and are due by 13th of the month
following the relevant quarter.

Whereas, those taxpayers who do not opt for the QRMP scheme or have total turnover above Rs.5
crore must file the return every month on or before 11th of the next month.

Who should file GSTR-1?

Every registered person is required to file GSTR-1 irrespective of whether there are any transactions
during the period or not. For nil GSTR-1 filers, there is a facility to file through an SMS that began
from the 1st week of July 2020. The following registered persons are exempt from filing the GSTR-1:

How to revise GSTR-1?

A return once filed cannot be revised. Any mistake made in the return can be rectified in the GSTR-1
filed for the next period (month/quarter). It means that if a mistake is made in GSTR-1 of June 2021,
rectification for the same can be made in the GSTR-1 of July 2021.

Late Fees and Penalty

As per the GST law, a late fee for not filing GSTR-1 is Rs. 200 per day of delay (Rs. 100 as per the
CGST Act and Rs. 100 as per SGST Act). The late fee will be charged from the date after the due date.
However, after going through the notifications issued up to February 2021, the late fees continue to
be levied at a reduced fee of Rs. 50 per day and Rs 20 per day (for nil return). Note that on the GST
portal, the late fee on GSTR-1 is currently not being demanded as a part of payment challan in PMT-
06 at the time of filing GSTR-3B.

As per CGST notification 20/2021 dated 1st June 2021, the maximum late fee chargeable from the
period of June 2021 onwards.

Registered persons having no outward supplies in the tax period are liable to a maximum late fee of
Rs.500 (Rs.250 per Act). Whereas, registered persons having a total turnover of up to Rs.1.5 crore in
the preceding financial year, other than the nil filers are liable to a maximum late fee of Rs.2,000
(Rs.1,000 per Act). On the other hand, the registered persons having an aggregate annual turnover
of more than Rs.1.5 crore but up to Rs.5 crore in the preceding financial year, other than the nil filers
can be charged a maximum late fee of Rs. 5,000 (Rs.2,500 per Act). There is no change in maximum
late fee for taxpayers with total turnover more than Rs.5 crore and it remains Rs.10,000.

However, the tax officer may raise a notice demanding late fee for the period of delay at the time of
assessment of returns.

PROCEDURE FOR FILLING NIL GSTR1:

How to file nil GSTR-1 on the GST portal?

Here is a step-by-step guide on how to file nil GSTR-1 on the GST portal

Step 1- Login to the GST portal

Step 2 - Go to services in the drop-down, select return dashboard.

Step 3 - Select month and year of filling from the drop-down.

Step 4 - Click on ‘prepare online’ under GSTR-1 tile.

Step 5 - click on ‘ Generate GSTR-1 Summary’

Step 6 - Select the checkbox and click on ‘Preview’

Step 7 - Click on ‘submit’. you can file your return by either using DSC or using EVC.

What is GSTR 3B?

The GSTR-3B is a consolidated summary return of inward and outward supplies that the Government
of India has introduced as a way to relax the requirements for businesses that have recently
transitioned to GST.

Since a lot of small and medium businesses have been using manual accounting methods, filing
returns within the July 2017 deadlines would be difficult for many of these businesses. Hence, from
July 2017 to June 2018, tax payments will be based on a simple return called the GSTR-3B.
Step-by-Step to filling GSTR-3B on GST portal

Step 1 - login to GST portal and on the homepage, you can find the return filling status for the last
five tax periods.

Step 2 - Go to ‘Service’>’Returns’>’Returns Dashboard’.

Step 3 - This displays the ‘File Returns’ page.Select the ‘Financial Year’& ‘Return Filling Period’for
which you want to file the return from the drop-down list.Click the ‘SEARCH’button

Note that if you submit quarterly returns, you must also file form GSTR-3B for the last month of the
year.If you choose month 1 or month 2 of the quarter, the form GSTE-3B tile will not be usable.

Step 4 - On ‘Monthly Return GSTR-3B’tile, click the ‘PREPARE ONLINE’ button.

LEARNING EXPERIENCE

It was really a great experience to me to work with HARISH & CO(Chartered Accountants)
Internships are a great way to apply the knowledge from the classroom to real-world experience.
Learning is one thing, but taking those skills into the workforce and applying them is a great way to
explore different career paths and specializations that suit individual interests. Internship gives
experience in the career field which we want to pursue. It also gives individuals an edge over other
candidates when applying for jobs, it also prepares us for what to expect in companies and increases
confidence in work.

Firstly, I started my intern by doing purchase invoice and sales invoice entries and also, I vouched it
and then it continued with tally ERP9, GST and party reconciliation statement..

I would like to end it by saying internship is an especially important aspect of any post graduation.It
helps us to know everything in practical and you gain knowledge and excel in your career.