EXECUTIVE SUMMERY Audit procedure is mainly a step by step approach.

As this is a case
study on a selected NGOs (according to ACNABIN no one can disclose the name of the
Company name) particular project, it will cover a little area of NGO auditing. But the snapshot can
be obtained from this study. The selected NGO has wide range of operations. As an audit firm
ACNABIN does complete set of procedures to be followed at the time of audit performed. From
engagement to report submission the process is followed with reasonable and professional care
and maintaining all rules and regulation and standards.
In this report the main focus was on the implementation procedure of audit and finding out the
features that is taken to audit the NGOs. NGO auditing is not like general company auditing.
Huge amount of foreign donations are involved here. For that reason the verification of the
authenticity of foreign donation is mandatory in case of NGO auditing. The 35 conditions imposed
by NGOAB are considered a guideline in this regard.
The auditing is done to find out irregularities regarding stock management, fixed asset
management, proper implication of Bangladesh Accounting standards, VAT Act, Income tax
ordinance, labor law and other included in internal control system.
The recommendation provided by the auditor is obviously beneficial for the NGOs as those can
improve the quality of the respective NGOs performance. In the audit a follow up of the previous
years audit is verified whether that is solved or not. If not, recommendation on taking proper
action is communicated to the management.
But the effort will best be obtained when the transparency of financial reporting will be ensured
through a system where the audit procedure will be more flexible and easy to understand.
Because it will ensure greater accessibility of people to disclose and evaluate as well as
understand and implement the auditing and accounting knowledge.
The auditing profession has contributed and will be contributing a greater extent in ensuring
transparency and efficiency of internal control system of various sector of Bangladesh. The
achievement of the auditors will be then when the maximum people of the country will be aware
about their rights and then proper transparency will come conquering all obstacles.
CHAPTER ONE
1.1 Introduction:
Bangladesh has a history of rich sociological bondage. This social bondage is a basic cultural
attributes of Bangladeshi society. With the span of time the social bondage and other social
developmental and other activities is now loosing the appeal and effectively. But the state and
governmental system is not as adequate to fulfill the requirement of the people of our country.
The new capitalist culture is now expanding the income gap between the rich and poor.

Undesirable Social and Cultural hazards are now growing in numbers. Government is elected by
the people but due to some sort of systematic hazards and cultural deterioration all governmental
activities do not fully benefit the people of the country. NGOs are welcomed here to replace this
type of responsibilities which would have to be done by the Government. Non Governmental
Organizations (NGO) is not financed by the Government. NGOs mainly receive fund from foreign
countries and they expend this on different projects aiming to maintain social awareness covering
the site of education, sanitation and health. To ensure proper transparency and accountability
generally auditing is done on those NGOs. Because there are huge possibilities of misusing the
fund received from the foreign donor. Potential threats and prospects of NGO auditing is now a
very important aspect to raise awareness of the stakeholders of the NGOs and making an
evaluation to improve the quality of auditing. This NGO receive a huge amount of Donations
which are transmitted to Sub-recipients NGOs and with prescribed instruction and Budgets. But
due to some difficulties and Problems the proper clarification of the audit made cannot be
achieved. Due to the weakness in internal control system and other associated external problems
the proper utilization of fund money sometimes fall apart. To minimize the risk of that misuse the
roll of auditors is important. What should be those roles in assessing the risk, minimizing those
risks, strengthening the internal control system and making adequate contribution to the
development of the country is an important aspect of this internship report proposal. ACNABIN as
a leading chartered accountancy firm has a wide practical exposure on the NGO auditing. In this
study those information are incorporated which are best conform the procedure of Auditing of a
NGOs by a CA firm.
1.2 Objectives of the study:
Generally in our academic life we get theoretical knowledge about different aspects. But now a
day, in the job market there is no substitute of work experience. Getting meaningful work
experience in one major field of study must to be given a high priority. After getting theoretical
knowledge from university, it is all about the application of that knowledge in real world situations.
It has immense importance to establish relationship between theory and practices in real world
situation. Practically The Procedure of NGO auditing is deeply characterized by the current
accounting and auditing standards, Role of regulatory authorities, Activities of Different Financial
and Non-Financial Institutions from home and abroad and Government itself. The objectives of
this report are:
Gaining practical knowledge and experience on how a chartered accountancy firm (ACNABIN)
performs an audit and a how audit work.
Special Procedures taken by the Firm (ACNABIN) to audit NGOs and their sub recipients.

Understanding the field level problems related to the implementation of the prescribed
procedure from the part of both Auditor and client?
Getting a exposure of the Problems in internal control system of different Organizations and
plausible recommendations.
Understanding how NGOs are being benefited by the supervision of the audit firm with
adequate exposure on future prospects.
1.3 Methodology of collecting Information:
The hypothesis which I have developed will be through empirical testing research based on the
collection of quantitative data taken from financial statements, balance sheets of Different SubRecipients and the selected NGO itself. I will mainly focus on the qualitative aspect of my audit.
Because for most of the cases, auditing is not only to focus on quantitative aspects of
information, it is focusing on qualitative aspects of information also. And there is a high
confidentiality regarding the quantitative information.
In order to prepare the assigned project paper I have collected necessary information from two
types of source as follows:
1)

Primary sources information.

2)

Secondary sources information.

Primary sources information

1.
I have collected primary information by working with NGO audit teams.
2.
Discussing with engagement partner, audit manager, audit stuff and articled students.
Secondary sources information
I have also collected secondary information like annual audit report, management audit report,
accounting system, Policies, Circulation & audit working papers.
2.
The information was obtained from various corresponding files of the firm.
1.

1.4 Limitation of the study:

During my study, I have confronted some challenges. I have tried my best to overcome those
challenges. Even then, I have some limitations. The study is conducted with an objective to make
a thorough study of external audit procedure. The challenges I mentioned before can be termed
as the limitation of my study. Those limitations are as follows:
a)

As the internship was the first practical experience, it was not possible for me to know all

and everything of audit procedure.

b)

Some qualitative information is incorporated and for that reason the name of the NGO

cannot be mentioned.
CHAPTER TWO
LITERATURE REVIEW

NGO means Non Government Organization. NGOs are not self-serving in aims and related
values. Their aim is to act in the public arena at large, on concerns and issues related to the well
being of people, specific groups of people or society as a whole. They are not pursuing the
commercial or professional interests of their members.
Non-governmental development organizations are potentially critical catalysts for unlocking the
energies and resources of the poor and voiceless, and for building pluralistic and democratic
societies. To be effective in this role, they must formulate and implement programs that
strategically promote and support long-term changes that have large-scale development
multiplier effects. All too often the early successes of NGOs are difficult to sustain let alone
replicate on a larger scale, because of problems in organization and management. (Brown,
David. 1988. Organizational Barriers to NGO Strategic Action. Institute for Development
Research, Boston, 10 pp.)
Auditing is the accumulation and evaluation of evidence about information to determine and
report on the degree of correspondence between the information and established criteria.
Auditing should be done by a competent, independent person. (Loebbecke.1986)
In other words Auditing is subject to expectations and demands which are, justifiably or
otherwise, often disappointed (Kealey, Lee & Stein 2007).
According to the Companies Act 1994, accounts of companies registered under this act must be
audited by chartered accountants within the regulations of the Bangladesh Chartered
Accountants Order 1973. Similarly, all books of accounts maintained by a non-government
organization receiving foreign donations shall be audited by a chartered accountant as defined in
the same Order (http://www.banglapedia.org/httpdocs/HT/A_0361.HTM)
NGO Auditing is being characterized as a tool to find out the possible threats and risk associated
with the operation of the NGO. To ensure Accountability in NGO sector previously studies are
done. With regard to the evolution of NGO accountability practices and their implications on
NGOs, Songco (2007) finds that the effort of creating a more proactive environment for NGO
accountability is to dissect the different levels at which accountability needs to be promoted, the
methods that can be used by NGOs operating in these different levels and incentives and
disincentives that can be instituted in this regard. Lloyd R. and de las Casas, L. (2005)
investigate NGO self-regulation and its impact on enforcing and balancing accountability.
Srinivas(2005) claims that NGO accountability covers issues such as organizational
management, project implementation, financial management and information disclosure. It is
related to issues such as answerability, responsibility, liability, dependability, conscientiousness,
reliability, trustworthiness, legitimacy, and transparency. There has been a rising visibility and

stakes of NGOs work. A crisis of legitimacy in many sectors, especially business and government
has amplified the need for NGOs as a counterbalance.
Srinivas(2005) concludes that cases of NGO misconduct in advocacy, fund use, management,
and governance, have come to light, questioning their very legitimacy and congruency with social
values and expectations. Some NGO have also ignored the fact that they are answerable to key
stakeholders and the constituency that they work with, for promises of performance. Bendell
(2006) concluded based on the submissions of eleven world leading NGOs that the core values
and operating principles for international NGOs, should include good governance and
management; fundraising and multi-stakeholder engagement. It also makes specific reference to
respect for universal principles (such as the Universal Declaration of Human Rights),
independence, responsible advocacy, effective programs, non-discrimination, transparency and
ethical fundraising.
With regard to the evolution of NGO accountability practices and their implications on NGOs,
Songco (2007) finds that the effort of creating a more proactive environment for NGO
accountability is to dissect the different levels at which accountability needs to be promoted, the
methods that can be used by NGOs operating in these different levels and incentives and
disincentives that can be instituted in this regard.
Lloyd R. and de las Casas, L. (2005) investigate NGO self-regulation and its impact on enforcing
and balancing accountability. They argue that increasing visibility and increasing criticism, among
other factors, have led to growing pressure on NGOs to be more accountable, both from within
and outside of the sector.
CHAPTER THREE
PROFILE OF ACNABIN
Founded in 1985, ACNABIN started with seven partners. The name ACNABIN comes from the
acronyms of the founder partners:
A

= ABM Azizuddin

= Anwaruddin Chowdhury

= Abu Syed Mohammad Nayeem

= Mohammad Akhtaruzzaman

= ATMA Bari

= Iftekhar Hossain

= Mohammad Nurun Nabi.

At present the partnership comprises four founder partners and three new partners.
3.1 The Profile Of Acnabin At A Glance:

NAME OF THE AUDIT FIRM

ACNABIN
Chartered Accountants

DATE OF ESTABLISHMENT

15 February 1985

MAILING ADDRESS,
TELEPHONE, FAX & E-MAIL

BDBL Bhaban (13th Floor)

12 Kawran Bazar Commercial Area
Dhaka-1215, Bangladesh
Phones: (880-2) 8144347-52
Fax #: (880-2) 8144353-54
E-mail: acnabin@bangla.net
Web site: www.acnabin-bd.com

BRANCH OFFICE

House # 734, Road # 26, CDA R/A, Chittagong.

NAME OF PARTNERS,
QUALIFICATION

ABM Azizuddin
B.Com. (Hons). M. Com., FCA
(ICAB Regn. # 46)
:

Iftekhar Hossain
B. Com., FCA
(ICAB Regn. # 150)

Abu Sayed Mohammed Nayeem

B. Com. (Hons.), M. Com., M. Sc., (UK), FCA,

FCCA
(ICAB Regn. # 353)
:

Mohammad Nurun Nabi

B.Sc., FCA
(ICAB Regn. # 370)

Md. Rokonuzzaman
M. Com., FCA
(ICAB Regn. # 739)

M. Moniruzzaman
B. Com. (Hons.), M. Com., FCA
(ICAB Regn. # 787)

Md. Mominul Karim

B. Com. (Hons.), M. Com., FCA

(ICAB Regn. # 934)
3.2 Manpower Strength
Sl.

Personnel

Number

#
01.
02.

Partners

Professional Staff:
- Senior Director-Taxation
- Director-Audit & Consultancy (Chartered Accountant)
- Manager-Audit & Consultancy (Chartered Accountant)
- Manager-Taxation & Corporate Affairs (Chartered Accountant)
- Deputy Manager-Taxation & Corporate Affairs
- Deputy Manager-Audit & Consultancy
- Senior Assistant Manager-Audit & Consultancy
- Senior Assistant Manager-Taxation & Corporate Affairs
- Assistant Manager-Audit & Consultancy
- Assistant Manager-Taxation & Corporate Affairs
- Executive and Junior Executive-Audit, Consultancy & Taxation

03.
04.
05.

Articled Students

1
1
2
2
2
8
4
1
3
3
3
172

Interns

26

Supporting Staff

30

Total

265

*** copied organogram

3.3 Role of the Personnel:

i.

Partners:

The role of a partner is to get new clients and also sometimes the clients approach the partners
themselves. The partners also make sure the existing clients are provided with the best possible
service. Partners guide their employees to prepare a proposal which is to be submitted to the
client depending on what kind of service the client requires.
ii.

Audit manager:

An audit manager is a Chartered Accountant who assists the partners in various ways. He/ She
review reports before signing by the engagement partner.
iii.

Supervisor:

A supervisor may or may not be a Chartered Accountant. He has to complete the course and
having some years experience in the field of accountancy therefore he designated as the Audit
Supervisor of the firm. Audit manager briefs the audit supervisor on where and when an audit has
to be performed and how the job is to be carried out.
iv.

Senior student:

An audit senior has some years of experience in the accountancy field therefore he has been
designated as the audit Senior of the firm. Audit senior is briefed by the audit manager and
supervisor about where and when an audit has to be performed and how the job is to be carried
out.
v.

Semi-Senior Student:

A semi-senior student has to complete at least one year of article ship in the firm. Every time he
is liable to his assigned senior/s.
vi.

Junior Student:

Junior Students are the fresher who have just joined as an articled to the firm.
3.4 Non Professional Staff:
The numbers of non professional staffs involved with the firm are as follows:
General Manager (GM)
Manager, Administration
Accountant
IT Specialist
Computer Operator
Photocopy Machine Operator
Receptionist.
3.5 Services Provided By the Firm

ACNABIN provides a wide range of high quality services of diversified nature to its clients in the
private and public sectors in Bangladesh. It also renders services to international development
agencies and expatriate consultants those are associated with various projects in Bangladesh.

(a)Services
cover the
areas

offered
following

Statutory audit
Internal audit
Special audit
Management audit
Performance audit
Financial review
Accountancy
Taxation individuals, companies, banks, branch offices, liaison offices
Accountancy and management training
Company formation and secretarial work
Investigation of frauds and irregularities
Setting up branch office and setting up liaison office
Companies registration with Board of Investment, Ministry of Industries etc.
Work permits, visa, security clearance of expatriates
Bank accounts opening for foreign clients
Obtaining permission from the central bank regarding inward and outward remittance
Obtaining trade license, factory license, Import Registration Certificate, Export Registration
Certificate,

Bonded

warehouse

facility,

VAT

registration,

Membership

of

Trade

Association/chambers etc.
Providing services regarding setting up of office, drafting rent/lease agreement, recruitments of
staff etc.
Preparation of manual and policy guidelines in respect of finance, accounts, internal control,
inventory, procurement, operation, administration, human resources etc.
Services relating to fixed assets management, inventory management etc.

Services with regard to share issue, right issue, initial public offering, prospectus
Outsourcing of accounting services, payroll, internal audit etc.
Helping clients in adopting international and local accounting standards
Tax planning and tax management of expatriates
Business plan developments
System development
Feasibility study of projects
Management consultation/development
Due Diligence Review
Data processing with computers
Privatization consultancy (includes pre-privatization review, restructuring, valuation in particular
and privatization assistance in general)
Company acquisition, merger, spin off, amalgamation etc.
Liquidation and winding up of companies
Micro-finance consulting
Human Resource Development Issues
Organizational consulting services.
Designing computerized systems for MIS and accounting and its implementation
Share/business/asset valuation.
Other services as per needs of the clients.

(b) Following are a few

of the major category of
clients
receiving
ACNABINs services

Manufacturin
g and Trading

Energy and Telecommunications

Oil and gas

Power and power generation
Telecommunication
Mining.

Apparel
Chemical processing
Engineering

NGOs

Cement

Charitable organ

Fabricated products

Universities

Pharmaceuticals
Jute goods/garments/textiles
Food products

Commercial
services

Financ
e

Courier and cargo services

Banking

Hospitals

Investment

Airlines

Insurance

Hotels

Capital Market.

3.6 Association and Membership

Associations

Nonorga
s

(a) Affiliation with International Auditing/Accounting

Firm
ACNABIN is an independent member of Baker Tilly International, 8th largest
network in the world with 145 independent member firms in 110 countries.

(b) Relationship with International Accounting Firm

(i) Association with ASNAF-ASEAN Accounting Firms, Singapore since 18 February 2003.
(ii)Services already provided to the clients include:
Due diligence review
Joint venture enquiries
Business valuation
Tax advice
Statutory regulations
Establishing business presence
Liquidator/official receiver
Secretarial service

(c) USAID, EC
CIDA Enlisted

and

In 1993 ACNABIN have been enlisted by the United States Office of Regional Inspector
General/Audit, Singapore to perform financial audits of USAID fund recipients in Bangladesh. We
have been also enlisted by the European Commission and Canadian International Development
Agency to conduct financial audit of the recipients of their fund.

(d) Collaboration with

other consulting firms
ACNABIN has been able to establish close working relationship with many national and
international consulting firms in Bangladesh through its efficient and dedicated services.
ACNABIN has thus enriched its professional base for serving the clients interest in the best
possible manner.

Membership
(a)

Metropolitan Chamber of Commerce and Industries

(b)

The Dhaka Chamber of Commerce & Industries

(c)

American Chamber of Commerce in Bangladesh.

Firms registration with relevant authorities

i.

Partners of ACNABIN is registered with The Institute of Chartered Accountants of

Bangladesh (ICAB) for audit practice.

ii.

ACNABIN is enlisted with the Non-Government Organization Affairs Bureau Bangladesh

(NGOAB), Enlistment # 21 with NGOAB.

iii.

ACNABIN is registered with the Registrar of Joint Stock of Companies and Firms # PF

27897/86 under Section 58 (1) of the Partnership Act, 1932 (IX of 1932) dated June 21, 1986.
**** Information Gathered from ACNABIN Manual
CHAPTER FOUR
AUDIT PROCEDURES FOR NGOs FOLLOWED BY ACNABIN
4.1 ENGAGEMENT PROCEDURES
Before discussing the Audit Procedures followed by ACNABIN, I try to focus on the engagement
procedures through which ACNABIN is engaged/ recruited by the NGO to perform the audit.
ACNABIN faces three kinds of situations in engagement process:
Engagement with new NGO.
Engagement with existing NGO.
Directly appointed by the NGO.
Before starting the audit work, some letters are exchanged between ACNABIN and NGOs.
In case of engagement with new NGO:
4 (four) letters are exchanged between ACNABIN and NGO including acceptance letter of
appointment at the time of involving with the new NGO. Following stages are followed by both
ACNABIN and NGO:
Stage-1: NGO requires for technical and financial proposal from the ACNABIN
NGO generally gives circular with the newspaper or directly wants proposal for audit from the
audit firm. In case of direct offer they request to the audit firm to submit a quotation for the cost of
conducting audit of the NGO. They also mention the specific date to confirm the decision taken
by the audit firm and completion date for audits. The NGO firm mentions here the key areas of
the audit in the form of attachment. It assures that if ACNABIN audits NGOs firm, they will supply
the formal terms of reference/audit mandates to govern the conduct of audit.

Stage-2: The technical and financial proposal is sent by ACNABIN to the NGO
After reviewing the NGO letter or papers circular, audit firm drafts a proposal letter to the NGO.
The proposal letter contains technical and financial proposal for carrying out the subject of audit.
ACNABIN estimates its personnel costs after considering the mandates to be utilized and using
the minimum hourly rate of fees as prescribed by The Instituted of Chartered Accountants of
Bangladesh (ICAB). The firm also mentions that as it is an estimate, the cost may vary with
variation in number of mandates estimated to be utilized for the job.
Stage-3: Acceptance by the NGO on the basis of proposal of ACNABIN A letter of
contract
After receiving proposal letters from various audit firms, the NGO then selects the one which is
favorable to them, and it appoints the audit firm for audit purpose. From the technical and
financial proposal of the ACNABIN the NGO understands the nature of the audit (such as
independent, external) to assess the organizations internal control system in administering the
audited matter.
Stage-4: A letter is sent by ACNABIN to the NGO confirming to work with the NGO
Confirmation Letter
After receiving the acceptance letter from the NGO, ACNABIN provides confirmation letter
describing the firms willingness to work with the NGO.
In case of engagement with existing NGO
Three letters are exchanged between the ACNABIN and NGO:
1.
Willingness letter for reappointment: In this letter ACNABIN wants
to audit this year. It can request to increase audit fee or change some other conditions.
2.
2.
NGO sends appointment letter.
3.
3.
ACNABIN accept this appointment.
4.
4.
1.

In case of directly appointed by the NGO

If the NGO is interested to work with ACNABIN, then it directly sends an appointment letter to the
firm which includes all terms and conditions. If all terms and conditions are favorable to the
ACNABIN then it accepts the appointment and sends a letter to the NGO as an auditor.
4.2 Audit Procedures Followed By ACNABIN
The primary goal of ACNABIN at the time of involving in any audit engagement is to provide the
opinion on Financial Statements in accordance with Bangladesh Standards on Auditing (BSA) as
well as International Standards on Auditing (ISA). ACNABIN also seek to provide auditing and
management consultancy services that are innovative, efficient and most importantly responsive
to the NGOs needs.

There are seven steps involved in the procedures that come one after another. Steps are as
follows:
Identity Overall Goals
Gather & Evaluate Initial Information
Assess General Risks
Assess Account-Specific Risks
Develop Effective and Efficient Audit Plan/Work Program
Conduct Audit Testing
Evaluate and Communicate Audit Results
4.2.1

Identify Firms Overall Goals

The goal of ACNABIN in conducting an audit is to express an opinion as to whether the financial
statements are prepared and presented fairly in accordance with Generally Accepted Accounting
Principles (GAAP). The Firms policies on Generally Accepted Accounting Principles are
contained in Accounting Standards. The audit team considers these standards in formulating an
opinion. In forming an opinion, the audit team also addresses responsibilities for:
Errors
Irregularities and other matters
Efficiency
NGO value
Errors
Errors are unintentional misstatements or omissions of accounts of disclosures in financial
statements and may involve:
a)

Mistakes in gathering or processing accounting data from which financial statements are

prepared.
b)

incorrect accounting estimates arising from oversight or misinterpretation of facts and;

c)

Mistakes in the application of accounting principles relating to amount, classification,

manner of presentation or disclosure.

The audit team is required to design the audit to provide reasonable assurance of detection of
material errors. The In-charge of an audit team is responsible to ensure that the following matters
are considered at the time of audit:
Existence or occurrence. Assets or liabilities of the entity exist at a given date and recorded
transactions have occurred during a given period.
Completeness. All transactions and accounts that should be presented in the financial
statements are so included.

Accuracy. Transactions and account balances are accurately recorded.

Valuation. Assets are stated at realizable value, and liabilities are stated at expected settlement
amounts.
Rights and obligation. Assets are the rights of the entity and liabilities are the obligations of the
entity at a given date.
Presentations and disclosure. Particular components of the financial statements are properly
classified, described and disclosed.
Irregularities and other matters
Irregularities are intentional misstatements or omission of amounts or disclosures in financial
statements, including fraudulent financial reporting and misappropriation of assets. So there is
always a risk that material irregularities may occur and not be detected. This risk is increased by
the possibility of managements override of internal controls, collusion, forgery, or unrecorded
transactions. Thus, while the audit team is required to design the audit to provide reasonable
assurance of detection of material misstatements regarding irregularities, the following matters
must be considered by the In-charge of the audit team:
Detection of Material Irregularities
Detection of Material Misstatements resulting from illegal acts having a direct effect on the
Financial Statements.
Alertness for the Unsupported Transactions.
Efficiency
The audit team should design audit procedures that accomplish the overall goals discussed
above in the most efficient manner. Performing an efficient audit involves:
Performing front-end risk assessment and planning with adequate partner and manager
involvement.
Designing the combination of audit procedures based on the risk assessment that will efficiently
reduce the risk of undetected material misstatements to an appropriately low level.
Assigning work to adequately trained and supervised persons with appropriate experience and
skill levels.
NGO Value
It has long been a tradition of ACNABIN to provide enhanced value to NGOs as an integral part
of audits. This strategy has allowed ACNABIN to differentiate our approach from that of other
firms. Delivering added value as an integral part of an audit and effectively communicating the
added value information to top management, directors etc. is a key factor in building and
maintaining a sound NGO relationship.

Most NGOs and most of related personnel would agree that the achievement of ACNABIN
differentiate from other firms and communicate the value of ACNABIN audit by consistently
stressing the following:
Sound working relationship
Understanding NGOs Activities and Funding.
4.2.2 Gather & Evaluate Initial Information
After involving with the NGO, ACNABIN first task is to collect and evaluate the relevant and
necessary information related to the NGOs operation for the purpose of:
Understanding the NGOs activities and operation
Considering the internal control structure
Identifying NGO expectation
Considering materiality.
Understand the operation of NGOs
Proper planning and designing of an audit is dependent on proper understanding of NGOs
operation. So after appointing by a NGO, we, the members of an audit team use various sources
to gain an understanding of NGO operation. Different sources which provide us NGOs operating
information are as follows:Annual report
Minutes
Internal Reports
Previous years audit Work Papers
Discussion with NGO
NGO policies and circulation