Regulation 54 — Audit Regulations 2020
Original Rule Text
54. Application of prescribed accounting standards
The Accounting Standards (AS)/Indian Accounting Standards (Ind AS), auditing standards, guidance notes etc. issued by the Central Government/Institute of Chartered Accountants of India (ICAI) should be kept in view while carrying out the audit of Government companies or any other company. The statutory auditor shall comply with all the regulatory and statutory requirements while reporting audit results.
What This Means
When auditing government companies or other companies, the auditor must follow all applicable accounting and auditing standards. This includes Accounting Standards (AS), Indian Accounting Standards (Ind AS), auditing standards, and guidance notes issued by the Central Government or ICAI. The statutory auditor is required to comply with all regulatory and statutory requirements when reporting audit results.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Key Points
- 1Both AS and Ind AS standards must be considered during audit of government companies
- 2ICAI guidance notes and auditing standards are mandatory references
- 3The statutory auditor must comply with all regulatory requirements in audit reporting
- 4Standards issued by the Central Government take precedence alongside ICAI standards
- 5This applies to both government companies and 'any other company' under CAG audit
Practical Example
A statutory auditor appointed by CAG for Indian Oil Corporation must verify that the company has correctly applied Ind AS 116 (Leases) for its fuel station lease agreements. If ICAI has issued a guidance note on revenue recognition for oil companies, the auditor must consider it while examining IOC's revenue figures and mention any non-compliance in the audit report.
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.
Frequently Asked Questions
Which accounting standards apply — AS or Ind AS?▼
Are ICAI guidance notes mandatory for statutory auditors of government companies?▼
What happens if the statutory auditor fails to comply with prescribed standards?▼
This explanation was generated with AI assistance for educational purposes. Always refer to the official gazette notification for authoritative text.