POINTS TO BE CONSIDERED IN VERIFICATION
While conducting verification following points should be considered by the auditor:-
1. Existence: The auditor should confirm that all the assets of the company physically exist on the date of balance sheet.
2. Possession: The auditor has to verify that the assets are in the possession of the company on the date of balance sheet.
3. Ownership: The auditor should confirm that the asset is legally owned by the company.
4. Charge or lien: The auditor has to verify whether the asset is subject to any charge or lien.
5. Record: The auditor should confirm that all the assets and liabilities are recorded in the books of account and there is no omission of asset or liability.
6. Audit report: Under CARO the auditor has to report whether the management has conducted physical verification of fixed assets and stock and the difference, if any, between the physical inventory and the inventory as per the book.
7. Event after balance sheet date: The auditor should find out whether any event after the date of balance sheet has affected any items of assets and liabilities.