Students should practice these Audit of Different Types of Entities – CA Inter Audit MCQ based on the latest syllabus.

Audit of Different Types of Entities – CA Inter Audit MCQ

Question 1.
A Limited Liability Partnership shall maintain such proper books of account as may be prescribed relating to its affairs for each year of its existence. Books are prescribed _________
(a) under Section 34 of LLP Act, 2008
(b) under Rule 24 of LLP Rules, 2009
(c) under Section 44AA of the Income-tax Act, 1961
(d) under Section 129 of the Companies Act, 2013
Answer:
(b) under Rule 24 of LLP Rules, 2009

Question 2.
As per Section 34 of LLP Act, 2008, every LLP shall, prepare a Statement of Account and Solvency in prescribed form _________
(a) within a period of 3 months from the end of each financial year
(b) within a period of 6 months from the end of each financial year
(c) within a period of 30 days from the end of each financial year
(d) within a period of 60 days from the end of each financial year
Answer:
(b) within a period of 6 months from the end of each financial year

Question 3.
As per Rule 24 of LLP Rules, 2009, Statement of Account and Solvency shall be filed in with the _________, within a period of
(a) Form 5, SEBI, 30 days from the end of 3 months of the financial year to which the Statement of Account and Solvency relates
(b) Form 5, Registrar, 30 days from the end of 6 months of the financial year to which the Statement of Account and Solvency relates
(c) Form 8, SEBI, 30 days from the end of 3 months of the financial year to which the Statement of Account and Solvency relates
(d) Form 8, Registrar, 30 days from the end of 6 months of the financial year to which the Statement of Account and Solvency relates
Answer:
(d) Form 8, Registrar, 30 days from the end of 6 months of the financial year to which the Statement of Account and Solvency relates

Question 4.
Considering the provisions of Rule 24 of LLP Rules, 2009, state which of the following is correct:
(a) An LLP whose turnover does not exceed, in any financial year ₹ 50 Lacs, or whose contribution does not exceed ₹ 25 Lacs shall not be required to get its accounts audited
(b) An LLP whose turnover does not exceed, in any financial year ₹ 40 Lacs, or whose contribution does not exceed ₹ 20 Lacs shall not be required to get its accounts audited
(c) An LLP whose turnover does not exceed, in any financial year ₹ 40 Lacs, or whose contribution does not exceed ₹ 25 Lacs shall not be required to get its accounts audited
(d) An LLP whose turnover does not exceed, in any financial year ₹ 50 Lacs, or whose contribution does not exceed ₹ 40 Lacs shall not be required to get its accounts audited
Answer:
(c) An LLP whose turnover does not exceed, in any financial year ₹ 40 Lacs, or whose contribution does not exceed ₹ 25 Lacs shall not be required to get its accounts audited

Question 5.
Auditor of an LLP shall be appointed for:
(a) each financial year
(b) two financial years
(c) three financial years
(d) five financial years
Answer:
(a) each financial year

Question 6.
Auditor for the first financial year of an LLP may be appointed by the designated partners:
(a) within 3 0 days of incorporation of LLP
(b) within 3 months of incorporation of LLP
(c) at any time but before the end of the first financial year
(d) within 30 days of end of the first financial year
Answer:
(c) at any time but before the end of the first financial year

Question 7.
The designated partners may appoint an auditor for each financial year {other than first financial year) of LLP:
(a) within 90 days of the commencement of each financial year
(b) within 180 days of the commencement of each financial year
(c) at least 30 days prior to the end of each financial year
(d) at least 90 days prior to the end of each financial year
Answer:
(c) at least 30 days prior to the end of each financial year

Question 8.
Auditor of an LLP shall hold office in accordance with the terms of his or their appointment and shall continue to hold such office till the period
(a) the new auditors are appointed
(b) they are re-appointed
(c) the new auditors are appointed, or they are re-appointed
(d) the new auditors are appointed, or they are re-appointed, whichever is later
Answer:
(c) the new auditors are appointed, or they are re-appointed

Question 9.
As per Section 3 5 of LLP Act, 2008, every LLP shall file _________ duly authenticated with the Registrar within _________
(a) Annual Return; 60 days of closure of its financial year
(b) Annual Return; 120 days of closure of its financial year
(c) Financial Statements and Audit Report; 30 days of closure of its financial year
(d) Financial Statements and Audit Report; 60 days of closure of its financial year
Answer:
(a) Annual Return; 60 days of closure of its financial year

Question 10.
As per Section 36 of LLP Act, 2008, documents of LLP maintained with Registrar can be inspected by:
(a) Designated Partner Only
(b) Any Partner
(c) Any partner and the lenders
(d) Any person
Answer:
(d) Any person

Question 11.
An auditor ofa Co-operative Society is appointed by the
(a) Governing body of Co-operative Society
(b) Members of Co-operative Society
(c) Registrar of Co-operative Societies
(d) None of the above .
Answer:
(c) Registrar of Co-operative Societies

Question 12.
As per Section 5 of the Co-operative Societies Act, 1912, in the case ofa society where the liability of a member of the society is limited, no member of a society other than a registered society can hold such portion of the share capital of the society as would exceed a maximum of _________ of the total number of shares or of the value of shareholding to _________
(a) 10%; ₹ 1,000
(b) 20%; ₹ 1,000
(c) 10%; ₹ 10,000
(d) 20%; ₹ 10,000
Answer:
(b) 20%; ₹ 1,000

Question 13.
A society may invest its funds in any one or more of the following:
(i) In the Central or State Co-operative Bank
(ii) In any of the securities specified in Section 20 of the Indian Trusts Act, 1882
(iii) In the shares, securities, bonds or debentures of any other society with limited liability
(iv) In the Shares of Public Sector Undertakings
(v) In the Securities of Public Listed companies
(vi) In any Co-operative Bank, other than a Central or State co-operative bank, as approved by the Registrar on specified terms and conditions
Select the appropriate one:
(a) (i), (ii) and (iii) only
(b) (i), (ii), (iii) and (iv) only
(c) (i), (ii), (iii), (iv) and (v) only
(d) (i), (ii), (iii) and (vi) only
Answer:
(d) (i), (ii), (iii) and (vi) only

Question 14.
A co-operative society is required to transfer _________ to Reserve Fund, before distribution as dividends or bonus to members
(a) 10% of the profits
(b) 20% of the profits
(c) 25% of the profits
(d) None of the above
Answer:
(c) 25% of the profits

Question 15.
A registered society may, with the sanction of the Registrar, contribute an amount _________
(a) not exceeding 10% of the net profits remaining after the compulsory transfer to the reserve fund for any charitable purpose
(b) not less than 10% of the net profits remaining after the compulsory transfer to the reserve fund for any charitable purpose
(c) not exceeding 10% of the net profits before transfer to the reserve fund, for any charitable purpose
(d) not less than 10% of the net profits before transfer to the reserve fund, for any charitable purpose
Answer:
(a) not exceeding 10% of the net profits remaining after the compulsory transfer to the reserve fund for any charitable purpose

Question 16.
In respect of examination of overdue debts of a co-operative society, auditor is required to perform which of the following:
(a) Overdue debts for a period from 30 days to 6 months and more than 6 months will have to be classified and shall have to be reported by an auditor
(b) The auditor will have to ascertain whether proper provisions for doubtful debts is made and whether the same is satisfactory
(c) The percentage of overdue debts to the paid-up capital will have to be compared with last year, so as to see whether the trend is increasing or decreasing
(d) All of the above
Answer:
(b) The auditor will have to ascertain whether proper provisions for doubtful debts is made and whether the same is satisfactory

Question 17.
In case of co-operative societies, bad debts and irrecoverable losses before being written off against Bad Debts Funds, Reserve Fund etc. should be certified as bad debts or irrecoverable losses by the _________
(a) auditor where the law so requires
(b) the managing committee of the society, when law is silent as to certification by auditor
(c) the managing committee of the society, irrespective of the provisions ofthe law
(d) both (a) and (b)
Answer:
(d) both (a) and (b)

Question 18.
During the course of audit of co-operative society, if the auditor notices that there are some serious irregularities in the working of the society, he may report these special matters to the _________
(a) Registrar
(b) Members
(c) Managing Committee
(d) None of the above
Answer:
(a) Registrar

Question 19.
Circumstances in which auditor of co-operative society is required to submit special report includes:
(a) Personal profiteering by members of managing committee
(b) Weak Internal Control
(c) Errors noticed in the books of account
(d) All of the above
Answer:
(a) Personal profiteering by members of managing committee

Question 20.
First Auditor of Multi-State Co-operative Society shall be appointed by _________
(a) Board of Directors within one month of registration
(b) Registrar within one month of registration
(c) Managing Committee within 60 days of registration
(d) Members within 60 days of registration
Answer:
(a) Board of Directors within one month of registration

Question 21.
Subsequent auditor of a multi-state co-operative society is to be appointed:
(a) by Registrar
(b) at each AGM
(c) at first AGM and thereafter at every 6th AGM
(d) by BOD
Answer:
(b) at each AGM

Question 22.
A person who is a Chartered Accountant can only be appointed as auditor of a multi-state co-operative society. However, a person who is indebted to multi-state co-operative society or who has given guarantee in connection with a loan of third party to multi state co-operative society for an amount exceeding _________ cannot be appointed as auditor
(a) ₹ 1,000
(b) ₹ 10,000
(c) ₹ 1,00,000
(d) ₹ 5,00,000
Answer:
(a) ₹ 1,000

Question 23.
Which of the following matter is not required to be inquired by auditor of multi-state co-operative society under Sec. 73(2) of Multi-State Co-operative Societies Act, 2002:
(a) Whether loans and advances made on the basis of security have been properly secured and whether the terms on which they have been made are not prejudicial to the interests of the society or its members;
(b) Whether transactions which are represented merely by book entries are not prejudicial to the interest of Society;
(c) Whether personal expenses have been charged to revenue account; and
(d) Whether loans and advances shown as deposits
Answer:
(d) Whether loans and advances shown as deposits

Question 24.
As per Section 77 of Multi-State Co-operative Societies Act, 2002, Central Government may pass an order for the special audit if they are of opinion
(a) that the affairs of any Multi-State Co-operative society are not being managed in accordance with co-operative principles or prudent commercial practices or with sound business principles
(b) that any Multi-State Co-operative society is being managed in a manner likely to cause serious injury or damage to the interests of the trade industry or business to which it pertains
(c) that the financial position of any Multi-State Co-op-erative society is such as to endanger its solvency
(d) any of the above
Answer:
(d) any of the above

Question 25.
Special Auditor under section 77 of Multi-State Co-operative Societies Act, 2002 can be:
(a) Auditor of Multi-State Co-operative Society
(b) Any Chartered Accountant other than auditor of Multi-State Co-operative Society
(c) Any person, may or maybe a Chartered Accountant
(d) Either (a) or (b)
Answer:
(d) Either (a) or (b)

Question 26.
An inquiry may be ordered by Central Registrar u/s 78 of Multi-State Co-operative Societies Act, 2002, on a request received from:
(a) not less than 1 /3rd of the members of the board or not less than 1 /5th of the total number of members of a multi-state cooperative society
(b) not less than 1/5th of the members of the board or not less than 1/3rd of the total number of members of a multi-state cooperative society
(c) not less than 1/3rd of the members of the board or not less than 1/3rd of the total number of members of a multi-state cooperative society
(d) not less than 1/5thofthe members of the board or not less than 1/5th of the total number of members of a multi-state cooperative society
Answer:
(a) not less than 1 /3rd of the members of the board or not less than 1 /5th of the total number of members of a multi-state cooperative society

Question 27.
An inquiry may be ordered by Central Registrar u/s 78 of Multi-State Co-operative Societies Act, 2002, on a request received from certain category of person. However, no inquiry shall be held unless
a notice of not less than has been
given to the Multi-State Co-operative Society
(a) 10 days
(b) 15 days
(c) 30 days
(d) 45 days
Answer:
(b) 15 days

Question 28.
An inquiry may be ordered by Central Registrar u/s 78 of Multi-State Co-operative Societies Act, 2002, on a request received from certain category of person. Scope of inquiry related to:
(a) the constitution and managing committee of the Multi-State Co-operative Society
(b) the working of a Multi-State Co-operative Society
(c) the financial condition of a Multi-State Co-operative Society
(d) the constitution, working and financial condition of a Multi-State Co-operative Society
Answer:
(d) the constitution, working and financial condition of a Multi-State Co-operative Society

Question 29.
Person conducting inquiry u/s 78 of Multi-State Co-operative Societies Act, 2002 haspowerto require the officers of the society to call a general meeting of
the society by giving notice of not less than _________ at such time and place atthe headquarters ofthe society to consider such matters, as may be directed by him
(a) 7 days
(b) 14 days
(c) 21 days
(d) 21 clear days
Answer:
(a) 7 days

Question 30.
Person conducting inspection u/s 79 of Multi¬State Co-operative Societies Act, 2002 may exercise which of the following powers:
(a) access to all books, accounts, papers, vouchers, securities, stock and other property of that society and may, in the event of serious irregularities dis-covered during inspection, take them into custody
(b) verify the cash balance of the society
(c) call a meeting ofthe Board and also a general meet¬ing ofthe society where such general meeting is, in his opinion, necessary
(d) all of the above
Answer:
(d) all of the above