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CA is one of the best career options, but the first step to becoming a Chartered Accountant is to clear the CA exams. And to clear the exams, the most important thing is proper guidance. CA course is filled with subjects that bring tremor in students and one such subject is Audit and Assurance. There are few principles with which you can score well in not just Audit and Assurance but any exam. So, let's talk about these principles and how we can score good marks in CA Inter Audit exams. These tips are not just for the new course students, the old course students can equally benefit from them. This post won't just tell you how to score good marks but also tell you how to score exemption in Audit.
Before we get started with how to score good marks in Audit, let's answer a few frequently asked questions-
Audit is a practical subject. Yes, you read it right. The conception that Audit is a theory subject is wrong on so many levels. In fact, Audit is the most practical subject out there. How is it a practical subject you may ask? The understanding of Audit is not just required for clearing the exam but is also important for our practice when we become a Chartered Accountant. So, we are not just studying for exams but also for our future.
Both. But understanding Audit is more important than cramming. So, to score good marks we have to apply a combination of understanding as well as cramming with more emphasis on the understanding part.
ICAI STUDY MATERIAL. We can't emphasize this more. Sure, there are plenty of books available in the market from renowned authors but nothing, I repeat, NOTHING can replace ICAI Study Material. Every teacher uses ICAI's Study Material as the source for their book and if someone doesn't then their book automatically becomes un-useful. You can refer any book that you like but ICAI's Study Material MUST never be left unattended. And for Old Course students, they must use Practice Manual along with the Study Material. Along with that, RTPs, MTPs, and Suggested Answers issued by ICAI should also be referred. The New Course students can also refer to Old Course's Suggested Answers for topics which are same in both the courses.
This is a question for another day but to summarise, do 'question based' study. As mentioned earlier, Audit is a practical subject and the understanding of the subject is very important. Where we get the understanding from and from where are we cramming is a key point. Doing a question-based study helps us understand what kind of questions are going to come in the exam and helps us to prepare for the same. The questions from the Study Material, Practice Manual, RTPs, MTPs, and Suggested Answers must be covered properly.
With that said and done, let's focus on why we are actually here-
There are a lot of things to be kept in mind while preparing for the exams. We'll divide this elixir into few points such as syllabus distribution for both old and new course, categorize SAs on the basis of importance, paper pattern, language, and presentation.
Syllabus distribution means the sequence in which you should study your chapters to have a better understanding of the subject. We'll divide it into two parts, Old Course and New Course.
Start with the first few basic chapters, i.e, Nature of Auditing, Basic Concepts in Auditing, Preparation for an Audit, and Internal Control. Then study Company Audit, Vouching and Verification, and Special Audit respectively. This will cover a good chunk and help you in a better understanding of the syllabus.
This is a proper plan for CA Inter New Course. First of all, you need to complete the first five chapters of the study material, viz., Nature, Objective and Scope of Audit; Audit Strategy, Audit Planning, and Audit Programme; Audit Documentation and Audit Evidence; Risk Assessment and Internal Control; and Fraud and Responsibilities of the Auditor in this Regard.
After finishing the above-mentioned chapters, you should complete Chapter 7- Audit Sampling; Chapter 8- Analytical Procedures, and Chapter 11- Audit Report. One thing to keep in mind is to complete the related SAs along with the chapters. These chapters are very important for understanding. After completing these chapters pick the chapter with the maximum weightage, i.e., Company Audit including CARO. Company Audit will come for around 10-20 marks in the exam which can play a key role in scoring good marks in Audit.
After that, pick Chapter 13- Audit of Different Type of Entities. One question is sure to come from this chapter. Then go for Chapter 12- Audit of Banks and Chapter 6- Audit in Automated Environment respectively which have two questions of 4 marks each. You can understand the concept of both the chapters and then do question-based study. For which you can use the RTPs, MTPs, and SAs of all the previous attempts. Covering 10-15 questions from both of these chapters from the institute's materials will ensure 8 to 16 marks in the exam.
At last, study Chapter 9- Audit of Items of Financial Statement. This is a vast chapter and anything can be asked from this chapter. If it is not possible to cover all the questions then cover at least 10-15 questions from this. You can find videos on YouTube for this chapter but make sure you are studying from good teachers only.
We have categorized SAs for you on the basis of Importance. The list will help you determine which SAs are very important, which SAs you can cover entirely through questions, and which SAs you can leave and still be able to do questions based on them.
| Standards on Quality Control (SQCs) |
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| SQC 1 |
Quality Control for Firms that Perform Audit and Reviews of Historical Financial Information, and Other Assurance and Related Services Engagements |
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| Standards on Auditing (SAs) | ||
| SA 200 | Overall Objectives of the Independent Auditor and the Conduct of an Audit in Accordance with Standards on Auditing | |
| SA 210 | Agreeing the Terms of Audit Engagements | |
| SA 220 | Quality Control for an Audit of Financial Statements | |
| SA 230 | Audit Documentation | |
| SA 240 | The Auditor’s Responsibilities Relating to Fraud in an Audit of Financial Statements | |
| SA 299 | Responsibility of Joint Auditors | |
| SA 320 | Materiality in Planning and Performing an Audit | |
| SA 500 | Audit Evidence | |
| SA 505 | External Confirmations | |
| SA 530 | Audit Sampling | |
| SA 570 | Going Concern | |
| SA 700 | Forming an Opinion and Reporting on Financial Statements | |
| SA 701 | Communicating Key Audit Matters in the Independent Auditor’s Report | |
| SA 705 | Modifications to the Opinion in the Independent Auditor’s Report | |
| SA 300 | Planning an Audit of Financial Statements |
| SA 315 | Identifying and Assessing the Risks of Material Misstatement Through Understanding the Entity and Its Environment |
| SA 330 | The Auditor’s Responses to Assessed Risks |
| SA 450 | Evaluation of Misstatements Identified During the Audit |
| SA 501 | Audit Evidence-Specific Considerations for Selected Items |
| SA 520 | Analytical Procedures |
| SA 540 | Auditing Accounting Estimates, Including Fair Value Accounting Estimates, and Related Disclosures |
| SA 550 | Related Parties |
| SA 580 | Written Representations |
| SA 610 | Using the Work of Internal Auditors |
| SA 706 | Emphasis of Matter Paragraphs and Other Matter Paragraphs in the Independent Auditor’s Report |
| SA 250 | Consideration of Laws and Regulations in an Audit of Financial Statements |
| SA 260 | Communication with Those Charged with Governance |
| SA 265 | Communicating Deficiencies in Internal Control to Those Charged with Governance and Management |
| SA 510 | Initial Audit Engagements - Opening Balances |
| SA 560 | Subsequent Events |
| SA 600 | Using the Work of Another Auditor |
| SA 620 | Using the Work of an Auditor’s Expert |
| SA 402 | Audit Considerations Relating to an Entity Using a Service Organisation |
| SA 710 | Comparative Information—Corresponding Figures and Comparative Financial Statements |
| SA 720 | The Auditor’s Responsibility in Relation to Other Information in Documents Containing Audited Financial Statements |
Now that our preparation part is done, let's focus on the real deal - the paper pattern. Since this is the first time that we'll have MCQs in our exams, this section becomes fairly important. Let's divide the paper pattern into two parts- Type of Questions and Number of Questions.
There will be three types of questions- MCQs, Correct or Incorrect, and other descriptive questions. The MCQs will be of 30 marks which will include 20, 1 mark questions, and 5, 2 marks questions. The paper will also include Correct/Incorrect type questions of 14 marks. The rest of the questions will be descriptive type.
There are going to be 6 questions in the Audit exam of which the students will have to attempt 5 questions. The first question will be compulsory which will include Correct/Incorrect questions. And there will be an internal choice in the 6th question.
It is fairly easy to score good marks with this paper pattern. The MCQs and Correct/Incorrect comprises of 44 marks alone. Even if you score 30 marks in them and score 40% from the rest of the 56 marks, you'll be looking at a good 52 marks. And if you put just a little bit more effort you can easily score an exemption in Audit.
Now that our "before exam" part is complete, let's focus on what we need to do during the exam. This is the part which will actually determine whether we are going to score good marks in Audit exam or not. This includes language, sentence formation, and paper pattern.
This is a very important thing because of which students lose their marks. They may have the conceptual knowledge but they fail to present that knowledge in their question paper. Audit is an exam which needs a higher level of knowledge and presentation skill. Instead of writing in layman's language include keywords in your answer. Include the technical keywords which are being used by the ICAI in the Study Material, RTPs, MTPs, and Suggested Answers. Learn the keywords and impress the paper checker and score good marks in Audit.
Truth be told, there are plenty of students who can't even form a proper sentence. But this is not something that can not be learned or improved. And how can you improve this and score good marks in Audit? Practice. "Awareness precedes change". Acknowledge the problem and practice it till you achieve perfection. Give mock tests, write answers and see where you are lacking. Don't just give one Mock Test, give as many as you can and see yourself improve with each one of them. There are plenty of tests series available online, get those and improve your presentation skill.
This is what everything depends on. Your months of coaching, studies, and practice everything comes to this one thing - Presentation. Here are few commonly asked questions and their answers-
Whether you should answer in points or not depends on the question that is being asked. If the question asks for 'Explain', 'Describe', and 'Analyze', then avoid writing in points. Instead, write in para-points. An example of para points is this post. But if the question asks for 'Advantage/Disadvantage', 'Process', or 'Limitations', then you should go for points. Even when you're writing in points don't forget to give an introductory paragraph and then continue with your points.
Yes. Repeat after me, 'Fresh Answer, Fresh Page'. Each of the answers must start from a new page. Avoid writing answers on the same page.
Making charts in your answer sheet enhances the presentation of your answer. Practice making charts during your preparation, this is one habit which will fetch you good marks in exams. Charts make your answers more appealing to the paper checker and are an extra something that you can use to make your answer sheet stand out among others and help you score good marks in Audit exam.
Few other things that you should use to improve your presentation-
And now everything left for you is to make use of these points and score good marks in Audit exam. If you use these points and apply them in your practice and presentation, you can surely score exemption in Audit exam. You can watch the video below which includes these points and is a power pack of motivation for you to start studying.