Auditor should check the books of accounts and balance sheet and need to prepare the audit report addressing to the shareholders and present it to the concerned department and to the company. Copy of such report should be sent to all the shareholders. Audit report should contain the following things.
1. Answer, clarification and explanation of furnished questions are given by the concerned authority satisfactory or not.
2. Income statement and balance sheet is prepared by the company in prescribed structure or not.
3. Accounts are maintained as per the provision of laid down rules and regulations or not.
4. Balance sheet of the company presents true and fair view of financial position or not.
5. High ranking official, representatives and staffs of the company have performed work as per the provision of rules and regulations or not; they have committed fraud or not.
6. Transactions of the company are satisfactory or not.
7. Auditor should provide suggestion if necessary.
In addition to above facts, an auditor should include other facts using his own discretion. Other facts which are to be incorporate in the report are given below:
1. An auditor should include all the facts demanded by the Company Act.
2. Auditor should include the true and fairness of books of accounts as well as facts where he is not able to satisfy himself.
3. Auditor should include all the important facts which directly affect the financial position of the company.
4. Some abnormal transactions which are found during the course of audit but they are necessary for the company should be incorporated in the audit report.
5. If financial statements like income statement and balance sheet are not maintain properly, an auditor should clearly state in the audit report.
6. An auditor should include in the report that the audit of books of account is made in detail or applying test check.
7. If there is special situation, an auditor should include it in the audit report.
8. If auditor detects any frauds and errors during the course of audit, he must include in audit report clearly stating their effect in financial statements. Like regarding valuation of stock, depreciation system demarcation of capital and revenue etc.
