Chartered Accountant Firm Internship Report

A PROJECT REPORT ON SUMMER TRAINING UNDERTAKEN AT A.K.A & CO. In partial fulfilment for the award of the degree of Bachelors of COMMERCE (BCOM) Honours Submitted by Arjit Maheshwari BCMH1CF11012 Batch of 2011-14 At

ITM UNIVERSITY, OPP. SITHOULI RAILWAY STATION, JHANSI ROAD, GWALIOR, M.P. June-July 2013 1 | Page

DECLARATION

I, ARJIT MAHESHWARI student of ITM UNIVERSITY, Gwalior Batch in BCOM Honours, hereby declare that, this Project Report under the title A.K.A & CO. is the record of my original work under the guidance of CA Mr. Arvind Kumar Agarwal. This report has never been submitted anywhere else for award of any degree or diploma.

Signature of the Student: Place: Etah Date:

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ACKNOWLEDGEMENT

It is a great opportunity & pleasure for me to express my profound gratitude to wards all the individuals who directly or indirectly contributed towards completion of this report. Working on this report was a great fun, excitement, challenges and a new exposure in the field of finance. I am greatly in debated to under whose guidance and concern I am able to bring the report into its real shape. I am thankful to Mr.Abhinandan Chakroborty and all faculty members of Management Department in providing me useful guidance for the completion of this report. I convey my gratitude to all those who are directly or indirectly related in the completion of this project report.

Arjit Maheshwari Roll No: BCMH1CF11012 Course: BCOM (Honours)

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INDEX S. NO.

CONTENT

PAGE

Chapter 1:

5

1 Introduction Chapter 2:

6

2 Industry Profile Chapter 3

10

3 Company Profile Chapter 4

12

4 Objective of the Study Chapter 5

13

5 Job / Work Description Chapter 6

26

6 Achievements & Learning Chapter 7

27

7 Suggestions Chapter 8

8

29

Limitations 9

Conclusion

Introduction of the Organization’s Business Sector

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30

Organization is working as a Chartered Accountants firm under the rules and regulations and code of ethics designed for CA firms by ICAI (The Institute of Chartered Accountants of India). The Institute of Chartered Accountants of India (ICAI or the Institute) was established as statutory body on July 1, 1961 under Chartered Accountants Ordinance, 1961 to regulate the profession of accountancy in the country. ICAI is governed by the Council which consists of nineteen members. Fifteen members are elected from amongst the members for a period of four years. The remaining four of the Council members are nominated by the Government of India. Vision of the ICAI is: The profession of Chartered Accountants in India should be the benchmark of professional excellence upholding the principles of integrity, transparency and accountability. Mission of ICAI: Is to achieve excellence in professional competence, add value to businesses and economy, safeguard public interest; ensure ethical practices and good corporate governance while recognizing the needs of globalization. These kinds of firms provide different kinds of professional services like audit, taxation and management consultancy to its clients. The Chartered Accountancy course is conducted by the Institute of Chartered Accountants of India, which has its headquarters in New Delhi, 5 regional offices (Calcutta, Kanpur, Chennai, Mumbai and New Delhi) and 81 branches under these regional centres.

Organizational Structure

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A hierarchy is an arrangement of items (objects, names, values, categories, etc.) in which the items are represented as being "above," "below," or "at the same level as" one another and with only one "neighbour" above and below each level. These classifications are made with regard to rank, importance, seniority, power status, or authority. A hierarchy of power is called a power structure.



Partners



Directors



Senior Managers



Managers



Supervisors



Senior Trainee Students



Junior Trainees

Partners are often the founders of the firms. Most of the firms’ names are associated with the names of partners. They are basically the main parties who issue and sign any report (specifically audit report) on behalf of the firm. Partners mostly communicate with the Senior Managers. In other words, the progress of any report and any inquiry is made from the Senior Managers and hierarchal structure is strictly followed to avoid any disruption.

Managers are inquired of by Senior Managers and mostly manager manage audit field works etc and after field work managers with cooperation of senior managers makes and finalize any audit report to be issued. Senior Manager is a qualified Chartered accountant having more than 10 year working experience.

Field work and information collection and implementation of policies by adopting changes in rules & regulations is the main responsibility of supervisors and trainees. They use different kind of techniques for error and fraud detection. 6 | Page

A.K.A & Co. Is having its head office in Etah. Almost all the controls and regulations are dealt at head office in Etah. All the offices constitute different number of departments who basically handle their respective functions. The major departments include



Audit and Assurance Department: Firm provides audit and assurance services to wide range of clients which include performing audits of financial statements of limited companies, NGOs and partnerships. Firm also performs special assignments which include management audits, internal audits and investigations. Audit focuses on business issues and the matters that can impact on the financial statements, whilst also retaining the basic audit procedures that test the information contained in the financial statements. Services are aimed to comply with the legal requirements as defined under the various laws and regulations in Pakistan. In doing so firm not only identify the non-compliances but also assists clients in its rectification, designing remedial measures and provides guidance to adhere with the laws and regulations. Firm always endeavour to meet reporting deadlines as set out by the laws and regulations or as mutually agreed with clients, without compromising the professional, legal and ethical requirements.

Firm emphasis on delivering high quality services to clients, adding value to their business through identification of existing and potential control risks and suggesting best possible measures in the given circumstances. Firm always place priority in deploying audit teams to clients who are well equipped with the specific industry knowledge, experience and are professionally sound.



Tax & Corporate Department: Firm delivers taxation services to clients and assists them in obtaining optimal tax benefits available under the laws. Firm also assist clients to comply with the tax rules and regulations and always keep them updated with the latest developments and amendments. Tax personnel are qualified professionals, experienced and knowledgeable. We maintain a comprehensive tax library which always 7 | Page

provides ready references and timely solution in complex situations. Firm provides a comprehensive range of tax services which includes;



Preparation and submission of annual tax returns



Compliance services



Tax advisory services



Representation and litigation with tax authorities



Personal income tax services

In A.K.A. & Co. same staff is handling with tax matters as well as corporate sector. While in corporate firm provides different kinds of services relating to corporate sector from incorporation to winding up of a Company.



Computer Department: Department handles the computer related matters and assists other departments in working properly and efficiently. Department deals with online filing of returns of income for tax department and finalize audit reports in proper format in a presentable manner. It deals with networking of computers in office and all other problems which may be faced by computer users time to time.



Correspondence Department: It handles with all the correspondence of the firm by sending the solicited and unsolicited information from time to time. Effectively and efficiently manage the day-to-day operations of the Correspondence. Interact with clients to resolve policy and customer issues. Identify trends and remove obstacles in Statement production and delivery by properly maintaining record of all communication for future reference.



HR Department: This department is mainly concerned with the recruitment, hiring/firing of the firm and this department presents the timely reports on effective utilization of the resources by the firm. A purpose of the human resource is to keep the trained employees and recruit new energetic staff to work. Another purpose of this 8 | Page

department is to provide a good working environment for staff and try to make by facilitating them and arranging some recreational activities for them. HR knows the real worth of its employees so cares for them and motivate them to work more efficiently and diligently.

The hierarchy adopted by A.K.A. & Co. is in accordance with the legal structure a CA firm shall have. Although the ICAI rules permit of not having the supervisors and does not make it mandatory having senior manager and manager, yet this goes as additional benefit for the firm of having such an extensive hierarchy.

COMPANY PROFILE A. K. A. & Co. was established in the year 1991. It is a leading chartered 9 | Page

Accountancy firm rendering comprehensive professional services which include audit, management consultancy, tax consultancy, accounting services, manpower management, secretarial services etc. A. K. A. & Co is a professionally managed firm. The team consists of distinguished chartered accountants, corporate financial advisors and tax consultants. The firm

represents

a

combination of specialized skills, which are geared to offers sound financial advice and personalized proactive services. Those associated with the firm have regular interaction with industry and other professionals which enables the firm to keep pace with contemporary developments and to meet the needs of its clients.

CORPORATE SERVICES 

Incorporation of company



Consultancy on Company Law matters.



Planning for Mergers, Acquisitions, De-mergers, and Corporate re-organizations.

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Filing of annual returns and various forms, documents.



Clause 49 review for compliance with fiscal, corporate and tax laws

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Secretarial Matters including share transfers



Maintenance of Statutory records



Consultancy on Public/Rights/Bonus Issue of shares.



Change of Name, Objects, Registered Office, etc.

AUDIT

Broadly, Audit involves the following: 

In-depth study of existing systems, procedures and controls for proper understanding. Suggestions for improvement and strengthening.



Ensuring compliance with policies, procedures and statutes.

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

Comprehensive review to ensure that the accounts are prepared in accordance with Generally Accepted Accounting Policies and applicable Accounting Standards/IFRS.

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Checking the genuineness of the expenses booked in accounts.



Reporting inefficiencies at any operational level.



Detection and prevention of leakages of income and suggesting corrective measures to prevent recurrence.



Certification of the books of account being in agreement with the Balance Sheet and Profit and Loss Account.



Issue of Audit Reports under various laws.

Types of Audits conducted 

Statutory Audit of Companies



Tax Audit under Section 44AB of the Income Tax Act, 1961.



Audit under other sections of the Income Tax Act, 1961 such as 80HHC, 80-IA, etc.



Concurrent Audits.



Revenue Audit of Banks.



Branch Audits of Banks.



Audit of PF Trusts, Charitable Trusts, Schools, etc.



Audit of Co-operative Societies.



Information System Audit



Internal Audits.

Objective of the Study 11 | P a g e

I choose to work with A.K.A AND CO. During this internship I have learnt many new skills. Before internship I have only theoretical knowledge about work in organisation but now I have practical some practical experience of working in organisation. Now I have knowledge about the organisation’s working environment and how organisations work and achieve their goals and objectives.

This internship has to gives me the understanding of business and also about the elements of strategic thinking, planning and implementation, and how these things are applied in a real world organisation environment. Following are the objectives that I have in my mind before working as an internee.

         

To improve communication skills. To analyze the business situation. To establish high standard in professionalism. To learn more than the theoretical knowledge. To learn book keeping practices of different companies. To apply the theoretical knowledge in actual organisation. To compare practical aspects with theoretical aspects. To make quick decision in real situation. To learn how to promote and to conduct research in business area. To promote my personal knowledge and professional preparation for future. To

   

properly integrate my theoretical knowledge and practical work. To plan for the future of oneself and learn how to adjust in an organisation. To know how to present your recommendations in front of your boss. To get knowledge of opportunities and threats while entering into an organisation. To get exposure to do a work in an organisation and also known about organisational behaviour, ethical rules and regulations.

JOB DESCRIPTION

I have tried my best to enhance my abilities and apply the knowledge that I gained during the studies. On my first day at firm, company secretary Miss. Nensi Goyal gave me training session about TDS returns and computerised accounting in tally software. Mr. Rahul Goyal 12 | P a g e

(assistant) also shared his practical experience with me and gave me some techniques of this process. He also guided me that how to prepare VAT return and creating data in income tax return preparation software. Different task that I performed during my internship: 1. Maintenance of accounts/ book keeping. 2. TDS return preparation. 3. VAT returns preparation. Software used during internship: 1. Compuoffice 2. Tally software

Overview of TDS Tax deducted at source (TDS) is a tax that is deducted from income that a company in India pays to a recipient or supplier if the income amount exceeds a specific statutory limit in a financial year. The types of income that are subject to TDS include: 13 | P a g e



Salary.



Interest and dividends.



Winnings from the lottery.



Insurance commission.



Rent.



Fees from professional and technical services.



Payments to contractors and subcontractors.

The withholding amounts for TDS can be deducted from an invoice submitted by a supplier or from the payment that is issued to the recipient or supplier. Examples of recipients and suppliers include contractors, providers of professional services, employees, and real estate landlords. Companies submit a TDS certificate to each supplier on a monthly or yearly basis. The certificate includes the payments, as

well as information

about the company and supplier. Companies must also submit an annual return to the government for each recipient or supplier for the financial year. TDS certificate can be either Form 16 (R75I10A) or Form 26Q-P2P-IND (R75I122EQ). Form 16 is the TDS certificate which an individual submits and Form 26Q is the TDS certificate which a company submits to the tax authorities. TDS must also be deducted from payments issued to third parties by both corporate and noncorporate entities. The entity must deposit the amount owed for withholding at any of the designated branches of banks that are authorized to collect taxes on behalf of the government of India. The entity must also submit the TDS returns, which contain details about the payments and the challan for the tax deposited to the Income Tax Department (ITD). For electronic TDS, companies must generate the Form 26Q for each financial quarter. This is a statutory requirement for the ITD.

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Process flow of TDS

This process flow shows the steps to charge and remit TDS :-

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Create vouchers for suppliers with pay status % and applicable tax type

Calculate TDS on vouchers

Issue payments to suppliers with TDS amounts deducted

Submit monthly payment for TDS to tax authority

Update Challan

Generate monthly statements and submit quarterly and annual returns

Preparation of VAT returns

At the end of the month or each quarter, you file a VAT return with the tax office, and remit the VAT due.

Prerequisites You have carried out the activities described in closing for VAT. 16 | P a g e

Process 1.

You prepare a copy of the sales ledger and the purchase ledger. The ledgers show the invoices that have been paid and on which VAT is thus due. The ledgers are for your own reference in the event of a checkup by the tax office.

2.

You prepare the VAT return. This consists of two steps. 1.

You calculate the total amounts of VAT for each tax code.

2.

You print the VAT return. The system fills out the fields in the VAT return using the totals that you calculated in the first step.

3.

For information about preparing VAT returns for VAT withheld from vendors.

4.

You file the VAT return with the tax office and remit the taxes.

Compuoffice online software:Tax Solution for professionals to provide end-end management of every stage of the tax life cycle - from provision to estimates and extensions. returns, audit, amendment and planning.

A solution for 

Income Tax Return



TDS return

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

Service tax return



Balance sheet & audit report



VAT returns (Raj./UP/MP)



Checking of assessment orders



ROC form and filling



CMA



AIR return



Document Management



Challan



All other required forms



Standard letters to clients



Standard formats of departmental letters



Office assistance works & mechanism.



Various types of reporting.

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Features:

Single switch board for all software



Common client information for all software



Searching of records by Code No., Name PAN, etc.



Online auto-update of software



Defining user rights with grouping facility.

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Password protection for individual clients



Active/De-active of individual party from particular/all software



Single window/screen to input, edit, view and print.



Front-view buttons for easy understanding.



User friendly similar layout of all software.



LAN compatible



Various data input validation checks to eliminate errors.



Easy auto backup of your precious data.



Option to access from any where in the world.

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Overview of Tally ERP 9 Journal entry Journal Vouchers are used to adjust the debit and credit amounts without involving the cash or bank accounts. Hence, they are referred to as adjustment entries.

Creating a Journal Entry Journal entries are usually used for finalization of accounts. To pass a Journal Voucher, Go to Gateway of Tally > Accounting Vouchers ·

Click on F7: Journal on the Button Bar or press F7. For example, there may be entries made for interest accrued or interest due. If you have to receive Interest from a party, the same can be entered using Journal Voucher.

1.

Debit the Party

2.

Credit the Interest Receivable Account The Journal entry is displayed as shown:

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SPECIAL KEYS FOR VOUCHER NARRATION FIELD: 

ALT+R: Recalls the Last narration saved for the first ledger in the voucher, irrespective of the voucher type.



CTRL+R: Recalls the Last narration saved for a specific voucher type, irrespective of the ledger.

Allowing Cash Accounts in Journals Journals are adjustment entries, which do not involve Cash account and Bank account. However in exceptional cases where the user would like to account Journal entries involving Cash/Bank Account, Tally.ERP 9 has the flexibility of passing such entries by enabling the option under F12 configuration. To enable Cash Accounts in Journal voucher, ·

Set Allow Cash Configuration).

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Accounts in

Journals to Yes in F12:

Configure

(Voucher

Entry

To pass a Journal voucher with Cash/Bank Ledger, 1.

Go to Gateway of Tally > Accounting Vouchers > Select F7: Journal

2.

Press the spacebar at the Debit or Credit field. The Journal Voucher Screen with Cash/Bank Ledger selection will appear as shown:

Debit Note Entry Debit Note is a document issued to a party stating that you are debiting their Account in your Books of Accounts for the stated reason or vise versa. It is commonly used in case of Purchase Returns, Escalation/De-escalation in price, any other expenses incurred by you on behalf of the party etc. Debit Note can be entered in voucher or Invoice mode. You need to enable the feature in F11: Accounting or Inventory features. 22 | P a g e

·

To use it in Voucher mode you need to enable the feature in F11 :Accounting Features Use Debit / Credit Notes.

·

To make the entry in Invoice mode enable the option F11: Accounting Features - Use invoice mode for Debit Notes. To go to Debit Note Entry Screen, Go to Gateway of Tally > Accounting Vouchers

·

Click on Ctrl+F9: Debit Note on the Button Bar or press Ctrl+F9. You can toggle between voucher and Invoice mode by clicking Ctrl+V. Pass an entry for the goods purchased returned to Supplier A:

Special Keys for Voucher Narration Field: 

ALT+R: Recalls the Last narration saved for the first ledger in the voucher, irrespective of the voucher type.

·

CTRL+R: Recalls the Last narration saved for a specific voucher type, irrespective of the ledger.

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Credit Note Entry

Credit Note is a document issued to a party stating that you are crediting their Account in your Books of Accounts for the stated reason or vise versa. It is commonly used in case of Sales Returns. A Credit Note can be entered in voucher or Invoice mode. You need to enable the feature in F11: Accounting or Inventory features. ·

To use it in Voucher mode you need to enable the feature in F11 :Accounting Features - Use Debit / Credit Notes.

·

To make the entry in Invoice mode enable the option F11: Accounting Features - Use invoice mode for Debit Notes. To go to Credit Note Entry Screen: Go to Gateway of Tally > Accounting Vouchers

1.

Click on Ctrl+F8: Credit Note on the Button Bar or press Ctrl+F8. You can toggle between voucher and Invoice mode by clicking Ctrl+V. Pass an entry for goods sold returned from Customer A:

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Special Keys for Voucher Narration Field: ·

ALT+R: Recalls the Last narration saved for the first ledger in the voucher, irrespective of the voucher type.

·

CTRL+R: Recalls the Last narration saved for a specific voucher type, irrespective of the ledger.

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LEARNING I learned through my training program, that how I can          

Improve communication skills. Analyze the business situation. Establish high standard in professionalism. Learn more than the theoretical knowledge. Learn book keeping practices of different companies. Apply the theoretical knowledge in actual organisation. Compare practical aspects with theoretical aspects. Make quick decision in real situation. Learn how promote and conduct research in business area. Promote my personal knowledge and professional preparation for future. To

   

properly integrate my theoretical knowledge and practical work. Plan for the future of oneself and learn how to adjust in an organisation. Know how to present your recommendations in front of your boss. Get knowledge of opportunities and threats while entering into an organisation. Get exposure to do a work in an organisation and also known about organisational behaviour, ethical rules and regulations.

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Suggestions 

They have good opportunity to introduce the ISO standards training program which

  

no other firm is giving to customer. Try to adopt new technologies that their competitors are not using. Make a network that allows its customers to negotiate with them easily. In comparison of A.K.A AND CO. With its competitors has an edge to make an



accurate and error free report. The local economy continues to be strong and we believe our typical clients will



continue to flourish. The company has mostly professional educated human resources, which are the



biggest threat for their competitors. The A.K.A. AND CO. Has the facility to give coverage even the small retailers for income estimation who want to take loan from bank.



A.K.A & Co strongly needs to improve its network firms so as to be counted among one of the extensively know firms in UP. The partner needs to make the best use of their goodwill to bring more clientage and reputation to firm. They need to offer the audit services at most economical cost with the assured quality services to retain and



expand clients. The infrastructure and working condition reviews can improve the working efficiency of the trainees. Audit and Assurance is the tough job. Some motivational meetings and mentoring exercises would bring good feel among employees for their work. Time to time financial bonuses or performance incentives will energize the staff.



The trainees are not offered extra financial or any other incentive for the extra work or over time. This causes some sort of mental stings which immediately needs to be

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overcome by the management. The firm, to be more competitive in days to come, still has room for improvement in Information Technology. As firm don’t have any of its website to attract customer and their timely feedback as most of the good firms have their own web and well organized. 

Firm also lacks in marketing perspective as it does not any marketer to market and introduce their business, firm is getting business only on personal relations of the partners and other firm personnel. So if firm thinks to improve its business volume it needs a professional marketer as many other big firms adopted and have complete marketing department.

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Limitations   

They have a small staff with shallow skills base in many areas. Less number of staff members. Developments in technology change this market beyond A.K.A AND CO. Ability to

 

adopt. Change in government policies and procedures may act as threat for company. A small change in focus of large competitor might wipe out any market position



A.K.A & CO. achive. A.K.A &CO. Has many

competitors. Under

certain

competitors may act as a major threat for the organisation.

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circumstances these

Conclusion 

A.K.A & Co is overall one of the profit making and reputed firm of Etah. The organization since its very first day is devoted to providing quality services. The detailed and through review of work and clients’ trust shows the perfection with which it is working.



The firm has earned a distinction of being placed in the category 'A' in the list of panel of auditors maintained by State Bank of india. Moreover only these “A” category firms can audit of listed companies.



The Institute of Chartered Accountants of India has also carried out the Quality Control Review and has issued satisfactory QCR report stating that the firm has conducted the audits of the clients in accordance with International Standards on Auditing.

Reference & Sources In my work I used different webs to collect information/data which includes. WWW.AKA&CO.COM WWW.ICAI.ORG WWW.WIKIPEDIA.COM

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WWW.INVESTOPEDIA.COM www.computaxonline.com

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