E-Book

CARO 2020 - Decoding the Perspective

The Institute of Chartered Accountants of India

(Set up by an Act of Parliament)
Southern India Regional Council
Chennai
 E-Book

CARO 2020 - Decoding the Perspective

This e-book has been authored by

CA. Bhavana Mupparapu

The Institute of Chartered Accountants of India

(Set up by an Act of Parliament)
Southern India Regional Council
Chennai
 Copyright © with SIRC of ICAI

All rights served. No part of this publication may be reproduced, stored in a retrieval
system, or transmitted, in any form, or means, electronic, mechanical, photocopying,
recording or otherwise without prior permission in writing, from the publisher.

DISCLAIMER:

The views expressed in this e-book are of the author(s). The Institute of Chartered Accountants of
India (ICAI) and/or Southern India Regional Council of ICAI may not necessarily subscribe to the
views expressed by the author(s).
The information cited in this e-book has been drawn primarily by the contributor. While every
effort has been made to keep the information cited in this e-book error free, the Institute or any
office of the same does not take the responsibility for any typographical or clerical error which
may have crept in while compiling the information provided in this e-book.

First Edition: July 2022

Email: [email protected]
Published by: Southern India Regional Council
The Institute of Chartered Accountants of India
ICAI Bhawan
122, Mahatma Gandhi Road
Post Box No. 3314, Nungambakkam,
Chennai - 600034
 THE INSTITUTE OF CHARTERED ACCOUNTANTS OF INDIA
(Set up by an Act of Parliament)
Southern India Regional Council

FOREWORD

CARO 2020 is a new format for issue of audit reports in case of statutory audits of companies
under Companies Act, 2013. CARO 2020 has included additional reporting requirements after consultations
with the National Financial Reporting Authority (NFRA). NFRA is an independent regulatory body for regulating
the audit and accounting profession in India. The aim of CARO 2020 is to enhance the overall quality of
reporting by the company auditors.

CARO 2020 has brought in significant change. Objective of the New CARO is to enhance the Trust in financial
statements, since number of companies in India have failed which has shaken the investors’ confidence.

Applicability of CARO 2020

 One person company
 Small Companies
 Banking Companies
 Insurance Companies
 Companies Registered for Charitable purposes
 Reporting Requirements under CARO 2020
 Details of tangible and intangible assets
 Details of inventory and working capital
 Details of investments, any guarantee or security or advances or loans given
 Compliance in respect of a loan to directors
 Compliance in respect of deposits accepted
 Maintenance of costing records
 Deposit of statutory liabilities
 Unrecorded Income
 Cash Losses
 Reporting regarding Fraud
 Funds raised and utilisation
 Compliance by a Nidhi

We are pleased to present before our members and other stakeholders this e-book, Company Auditors Report
Order (CARO), 2020- Decoding the perspective covering all the above aspects.

On behalf of SIRC, I wish to place our sincere gratitude and appreciation to CA. Bhavana Mupparapu, for
sharing her experience and expertise on the CARO 2020 amongst our members through this e-book. I also take
the privilege of thanking CA. R Muthurajan for reviewing the basic draft of e-book and adding value to the
substance of the e-book. The comments and suggestions on the e-book are welcome at [email protected]

CA.China Masthan Talakayala

Chairman, SIRC of ICAI
 Company Auditor's Report Order
CARO 2020- Decoding the Perspective
Imagine a situation where you are required to drive a vehicle in unmanageable traffic conditions without
even knowing the destination. The only instruction you know is to keep driving without stopping. Among
others, we as Chartered Accountants, all the more cannot do the same as we are trained and wired to
think skeptical and question the reasonability of the state of affairs. Now if we were to do the same in a
more difficult situation where the penalties for violation of even the pettiest of the traffic rule also is
humongous, would we still do it? Would we, as Chartered Accountants, assume such risk? I am sure
most of us would respectfully decline such an offer irrespective of the expected return, isn’t it?

With compliances of various regulatory bodies increasing by the day, the accountability and risk
factor of Chartered Accountants has become directly proportional to the dynamic changes. Therefore,
trying to implement the dynamic changes and amendments without understanding the bigger picture and
macro level perspective would be equivalent to driving in the above referred situations.

The robust economic and business conditions in the economy steered by globalization and
liberalization of trade practices that are witnessed by cross border business transactions, multi-national
presence of various entities has necessitated the paradigm shift from Accounting Standards to Indian
Accounting Standards and the well managed phased implementation covering most large entities
moderately. The very underlying concept of Accounting Standards has been revamped from dictating
specific treatments to more principal based and establishing broad rules under Indian Accounting
Standards. However, these financial statements prepared as per Indian Accounting Standards also gain
sanctity and reliability for various stakeholders only after they are signed and commented upon by the
auditor by way of an Independent Auditors’ Report accompanied by CARO (together referred to as Audit
Report hereafter) where applicable.

Further, considerable instances of audit failures witnessed in the recent past as a result of mis
presentation of financial statements and well-designed fraudulent schemes compel the need to update
the Audit Report for more information and better reporting of the true status of Companies.

Thus, we as auditors are entrusted with great

responsibility to summarize all our audit findings into our Audit
Report to provide reasonable assurance to the stakeholders that
the state of affairs of the entity are in order and that the entity in
toto is compliant of various statutory requirements applicable. The
decision making of the stakeholders is elicited largely from the
observations reported in our report among other factors.

Therefore, when our Audit Report finds paramount place in the monetary decision-making

process, the same ought to change to meet the emerging needs. Hence, CARO 2020.
Recent changes in CARO 2020

1. Reporting requirements with respect to Tangible and intangible assets

a. The words “Tangible assets” is now replaced by the words
“Property, Plant & Equipment” in order to match the terminology with
that of global accounting language and financials prepared as per
Indian Accounting Standards. This enables better understanding and
removes any possible confusion for stakeholders who are not well
versed with accounting jargon.
b. Inclusion of clause requiring reporting the
maintenance of proper & full records of Intangible
assets. Yes, the time has come for us to give more
importance to intangible assets and treat them at
par with tangible assets. With new forms of
businesses budding at a rapid rate, intangible
assets like trademarks, patents, brands,
franchisees, intellectual property, copy rights,
Goodwill etc., have gained immense prominence. Also, these intangible assets carry
substantial value and therefore have been assigned a separate clause in the Audit Report in
CARO 2020. In order to report the same, we might have to consider collecting title documents
for intangible assets for verification of ownership just as we do for tangible assets. However,
the form, content, terms etc., of the ownership is expected to be quite different compared
to that of tangible assets because of which we may have to rely on reports obtained from
competent professionals. Further, it might be challenging to collect information in case of
internally generated intangible assets like in-house development of software, apportioned
cost of intangible assets purchased for a group of related companies etc. In such cases, we
might collect the detailed cost records of every element in the process of asset creation /
development process and verify the invoices to ensure that the company has rightful title.
Further, it is advisable to collect Management Representation Letter to ensure that
they have reviewed the ownership of intangible assets and its valuations at regular intervals
and that the title is free from litigations or impairments as part of our working papers file.
c. In CARO 2016, we were only required to specify whether or not the title deeds of immovable
properties held by the company was in its own name or not. This clause has been slightly
amended to include a tabular presentation of the list of immovable properties the title deeds
of which are not in the name of the Company. The following is the table mandated
 Description Gross Held in the Relationship Period of Reason for not
of the carrying name of holding being held in the
property value name of the
company

As can be seen, this table calls for detailed information as to why the title deeds are not
in the name of the company and the relationship with such name holder. This new reporting
intends to disclose related party transactions and thereby intends to report any possible
violation of laws because of involvement of related parties.
This additional information can be collected in the process of verification of tangible and
intangible assets and its ownership as per the previous clause itself. In case any reporting is
required under this table, it is advisable to first establish the relationship of the company with
the owner of the title and cross check the same from external sources like MCA website
where possible. Next step would be to analyses the commercial elements of the transaction
and critically evaluate the reasons for holding the property in the name of other entity /
person and report accordingly.
d. In case of Revaluation of assets during the year (including right of use of assets), we are now
required to report if the valuation was carried out by a Registered Value and if the change in
net carrying value is more than 10%, the amount of change of each asset class is to be
reported in the Audit Report. The scope of this clause is further extended to include right of
use of assets also. This is applicable in Lease contracts where “lessee may elect to apply that
revaluation model to all of the right of use assets that relate to that class of property, plant
and equipment.”
The need for this clause is that revaluation of assets has
become relatively normal in the present time and every time the
assets are revalued, the net worth of the company is affected. This
might have an impact on several aspects like deciding the applicability
of various provisions, loan / overdraft facilities in banks and financial
institutions, reporting requirements for Stock Exchanges etc.

As we would collect the valuation report as part of routine audit procedures in the
event of revaluation of asset, no additional audit procedures are required for reporting of this
clause. We may report the changes due to revaluation of assets for each class / block of assets
separately for better presentation of information.
2. Reporting requirement with respect to pending litigations

Earlier, we were only required to report about unpaid statutory dues because of
pending litigations. Now we are required to report about proceedings pending / initiated
under the Benami Transactions (Prohibition) Act, 1988.
The perspective behind this amendment could be that any violation under this Act
usually entails substantial financial outflows and may sometimes jeopardize the very
existence of a company. Therefore, it is crucial to report the status of such pending
proceedings fairly in the Audit Report.
In order to report this clause, we may verify the invoices in Legal expenses account
and correlate the same with various pending litigations and collect a comprehensive list
from the Company containing details like the crux of the proceedings, Authority before
which the proceedings are pending, what is the likely impact of the verdict on the financials
etc.

3. Reporting requirements with respect to Inventories

The subjectivity of materiality is removed, and we are now required to express our opinion
on the appropriateness of the coverage and procedure adopted by the management for
verification of inventory. Further, where discrepancies of more than 10% are observed by the
management in aggregate of each class of inventories (in terms of value), we are required to
mention if the same has been adequately dealt with in the books of account.
This is because inventories hold substantial value in the overall financial wellbeing of
a company, and they must ideally not be subjected to the test of materiality. Therefore, any
variation beyond the threshold of 10% constitutes sizeable value and considered prudent to
report the same in our report.
In order to be able to report under this additional clause, we me rely on the audit
reports issued by the internal auditors of the company. In cases when internal audit is not
applicable to the company, we may conduct physical verification of stock in the first week of
April and reconcile the same to match the stock as on 31st March of the year. We may also
 Collect the inventory verification reports prepared by the management at the time of their
verification and their findings duly signed on their letterheads and a Management
Representation Letter stating that adequate measures have been taken to deal with
discrepancies, if any. Where any differences are noticed, we may make note of the same for
each category of inventory. We may further analyses the variances noticed by dividing the
same into gross and net by way of factoring standard stock losses, misplaced inventories etc.,
and accordingly disclose in the Audit report.

4. Reporting with respect to security for working capital limits

If a company has working capital limits of more than ₹ 5 crores from any bank or financial
institution that are secured against current assets of the company, we are now required to report
whether quarterly statements submitted to the bank / financial institution in this regard are in
conformity with books. If not, we are now required to report the details of the discrepancies.
This provision has been brought in light of the humungous financial frauds / bankruptcy of
companies reported by banks over the recent few years. There were several instances in the past
where some companies had submitted inflated current asset statements to the banks / financial
statements in order to keep their drawing power and cash credit limits maintained. This might
warrant the banks / financial institutions to write off substantial amounts as NPAs in the event of
non-repayment of borrowings by companies as there will not be sufficient current assets in
substance to exercise the lien and recover the debt when the companies are unable to repay.
In order to meet this additional reporting requirements, we may request the company to
send us a copy of the list of assets that are being pledged for lien and conduct physical verification
of stock before submission of documents in the bank / financial institution. Alternatively, we may
conduct surprise stock checks whenever possible during the year and correlate them with latest
current assets statements submitted to banks / financial assets to ensure the same have not been
inflated. For companies where internal audit is applicable, we may rely on the reports of the internal
auditors with respect to physical verification of stocks.

5. Reporting with respect to Investments, loans and advances given

The following disclosures are required to be given with respect to investments made,
guarantees or security provided, and loans & advances granted.
i. Disclosure of aggregate amount and Outstanding Balance in respect of such Guarantee, Security
or Loans & Advances to subsidiaries, Joint Venture and Associates. (Modified)
ii. Disclosure of the aggregate amount and Outstanding Balance in respect of such Guarantee,
Security or Loans & Advances to parties other than subsidiaries, Joint Venture and Associates.
(Modified)
iii. In case existing loans falling due during the year have been extended, renewed, replaced with
fresh loans, specify the aggregate amount and percentage of such loans. (Inserted)
iv. In case of loans or advances repayable on demand, without any terms or period of payment,
specify the amount of such loans given to the promoters & related parties. (Inserted)

The reason behind inserting the two new sub-clauses quite apparently is to curb money
laundering between related parties as related party transactions have been used as a tool to
siphon money in several instances by creating shell companies. Further, auditors have always
perceived the events such as frequent defaulting of loan payments, replacement of loans with
fresh ones etc., as indicators for financial distress which could possibly lead to insolvency
depending on the frequency and volume of borrowings. Therefore, it was time to introduce these
clauses in the Audit report to express the seriousness of such instances in the businesses.
In order to be able to report under these clauses, we may have to carefully and critically
examine all the transactions with related parties and not resort to sampling techniques for these
accounts. With due consideration of the concept of watch dog not a blood hound, we may treat
these limited accounts as an exception and conduct audit of related party transactions and
defaulting loan / renewal without repayment loan cases with utmost skepticism. We may obtain
confirmation of transactions and closing balances from auditors of related parties where
transactions have taken place during the year and communicate findings that we may deem fit.
6. Reporting with respect to transactions not recorded
Under this clause we are required to report if there was any unreported income that was
disclosed and added to income of the company during tax assessments.

This is because, it is quite normal that income declared by company in its return of income
may be increased by additions made by Assessing Officer. However, when certain additions are
substantial and recurring in nature, the company may have to give effect of such transactions in
its books of account of substantial years. Therefore, it is important for us to report the same in
our Audit report.
In order to report under this clause, we may login to the income tax e-filing portal of the
company and check the status of all assessment proceedings, both pending and complete and
accordingly report the same.

7. Reporting with respect to period and amount of default with respect to loans
Earlier, we were only required to report if there were any defaults in payment of interest
or repayment of loan. Now, the following new sub-clauses have been introduced
i. Lender wise details of defaults
ii. Whether the lender has declared the company as wilful
defaulter
iii. Whether term loans / short term loans were utilised for
the purpose for which they were obtained and
deviations, if any
iv. Details of funds procured by the company to meet the
obligations of subsidiaries, joint ventures, and associates
v. Whether the company has raised any loans on pledge of securities in the name of subsidiaries,
joint ventures, and associates
These sub-clauses are introduced to report the end use of borrowed funds. One of the
basic concepts of accounting - Matching concept stands violated under circumstances when
interest bearing loans are taken by holding company and the funds are diverted to its group
 Companies as interest free advances repayable on demand. This is in line with provisions of
Section 14A and Rule 8D of Income Tax Act, 1961. Further, reporting about the end use of
borrowed funds and deviations, if any, would also alarm the lender about the possibility of timely
recoveries.
In order to be able to report under these newly inserted clauses, we may carefully verify
all the loan disbursal documents and loan agreements to verify the schedule of assets pledged.
Further, we may critically examine all the loan account statements correlating the same with
related party accounts. We may compare all the payments towards loans during the year with
loan repayment schedule to check for any defaults and report accordingly.

8. Reporting regarding fraud

In this regard, we are additionally required to

report if any findings have been filed in Form ADT-4 with
the Central Government in relation to suspected offense
/frauds. Further, we are also required to report if any
whistle-blower complaints have been received during
the year.
This clause is introduced as such circumstances are very serious and if the auditor has
come across such findings during the course of audit, it definitely deserves a place in the Audit
report in order to make the same apparent to banks/ financial institutions / other stakeholders.
Bringing such situations into light and obtaining substantial audit evidence to report
under this clause could be very challenging for us as frauds, by definition are well designed acts
usually with escape plans in place. In order to be able to report under this clause, we may review
the whistle-blower policy of a company and call for all documented evidence. We may gather
more information by way of informal communication with the employees by staying well within
the boundaries established by the ethics committee. For companies where internal audit is
applicable, we may rely on the same as they are more frequently involved into the audit of affairs
of the company as compared to statutory auditors. We may also obtain a Management
Representation Letter stating that no frauds have occurred during the financial and that there
were no instances of whistleblowing.

9. Reporting with respect to Nidhi Companies

We are now required to report whether there is any default in payment of interest on
deposits or repayment thereof to Nidhi Companies.
 This is because, Nidhi Companies are like Co-Operative Societies where all members
function for the benefit of all. They are essentially non-commercial lending institutions for the
welfare of its members and therefore is given special status and compliance reliefs even in
Companies Act, 2013. Therefore, defaulting payments to such an entity is treated serious (similar
to that of MSMEs) warranting reporting in the Audit report.
In order to be able to report under this clause, we may obtain the list of borrowings of
the company from Nidhi Companies along with repayment schedules and compare both to find
discrepancies / defaults, if any. We may also obtain account statement and closing balance
confirmation from the Nidhi Company as external evidence for our verification.

10. Reporting regarding internal audit

We are now required to report if the internal audit system of a company, where
applicable, is commensurate with the size of the company and if we have obtained and reviewed
the internal audit reports.

This clause ought to have been included in the audit report from the time internal audit
was made mandatory to certain class of companies. This is because, when dealing with large
voluminous transactions of multinational companies, we inevitably rely on the reports of the
internal auditors / branch auditors and therefore, it is crucial to know if the internal audit is
commensurate with the size of the company.
We do not as such need to obtain any extra evidence to be able to report under this
clause. As we collect copies of internal audit reports as part of our routine audit procedures, we
may not be required to obtain any additional information for this clause. However, in cases where
there is a requirement to complete statutory audits in the months of April / May itself, it would
be challenging to collect internal audit reports as the internal audit would not have been
 Completed by then. In such cases, the internal auditors may conduct continuous review of
transactions of the last quarter alone in order to be able to deliver the internal audit report in
time.

11. Reporting with respect to registration under Reserve Bank of India

We are now required to additionally report if any NBFC activities are being conducted
without possessing registration u/s 45-IA of RBI Act and whether the company qualifies for a Core
Investment Company.
Core Investment Companies (CICs) are specialized NBFCs that need to undergo NBFC
registration with RBI. These CICs, which have an asset size of ₹ 100 crore and above, carry on the
business of acquisition of shares and securities, subject to certain conditions.
The need for this clause is quite clear from the registration threshold that when a
company is engaging into such high value NBFC activities, it shall have the requisite registrations
in place to establish accountability and to get covered under the ambit of periodic reporting of
information to respective regulatory authorities. It is very pertinent to have this clause in our
Audit report with budding NBFCs taking birth in the recent times and to protect the interest of
public at large.
In order to be able to report under this clause, we may check for ourselves from the books
of account if the financing activities are crossing the threshold of ₹ 100 crores and if yes, we may
obtain the registration certificate and check if periodic returns and forms have been filed with RBI
under the RBI Act and report accordingly.

12. Reporting with respect to Cash losses incurred during the year and immediately preceding year
 Under this newly inserted clause, we are required to report if the company had incurred
any cash losses during the year and the immediately preceding financial year and also the
quantum of loss / negative balance in the Cash Flow Statement.
This clause might have been introduced because as a general tendency most stakeholders
look at the Profit and loss account & EPS and the banks / financial institutions may be interested
in the income declared by the company in its computation statement. However, we all
understand that there are numerable non-cash adjustments required as per Companies Act,
2013, Income Tax Act, 1961, Indian Accounting Standards / Indian GAAP etc., that may completely
change the way the financial performance of the company is presented owing to various concepts
of accrual basis of accounting, matching concept etc. Therefore, the often-ignored Cash Flow
Statement is not brought into light and we are required to report the actual cash losses, if any.
In my opinion there is no additional audit documentation to be collected to report under
this clause as it is something that is apparent from the financial statements and is only being
brought to an important status. In cases where cash flow statement is not readily available, we
may calculate the cash loss by adding non-cash transactions to Net profit as per Profit / Loss
account like depreciation, amortization, deferred tax, and deferred expenditures, write backs
etc.

13. Reporting with respect of Resignation of Auditors

This clause requires us to report if there was any
resignation of auditor during the year and if yes, whether
issues, objections or concerns raised by the outgoing
auditors have been appropriately dealt with.
This well-deserved clause might have been
introduced to put a check on persuasive pressures imposed
on auditors in certain cases and other situations compelling
them to submit their resignation.
In order to report under this clause, along with the usual NOC obtained as per
professional code of conduct, we may additionally request a letter of communication stating the
reason for resignation from the outgoing auditor to be sure that the company is free from any
wrong happenings in this perspective. In this regard, it is worthwhile to note the distinction
between resignation of auditors and rotation of auditors. What is required to be reported is
resignation of auditors, but not rotation of auditors.
14. Reporting with respect to the uncertainties to meet liabilities
This is a newly inserted clause requiring the auditors to provide details of material
uncertainty about realization of financial assets and repayment of financial liabilities, and whether
such uncertainty exists on the date of Audit report and if the company will not be able to service
its liabilities as and when they fall due within a period of one year from the date of Balance Sheet.
This clause can be better understood conjunctively with Indian Accounting Standard 10
(Events after reporting period) / Accounting Standard 4 (Contingencies and events occurring after
the Balance Sheet date). There could be instances where occurrence of certain material events
could jeopardize the financial soundness of the company and the company may not be in a
financial position to repay its liabilities as and when they are due, but the management may
exercise its judgment to not include relevant disclosures in the financial statements as they are
not obligated to do so. Therefore, the need for Audit report. This reporting might significantly
influence the decision-making process and enable the stakeholders to take an informed decision.
Reporting under this clause could be a little tricky as it is a highly objective matter and
involves a severe degree of judgment to rightly assess the situation and the quantum of
repercussions on the financials and the solvency of the company. Certain cases might also require
reliance on reports of third-party reports / expert opinions by competent persons. We shall
exercise our due diligence in placing our reliance and report accordingly. We may also calculate
key financial ratios in order to ascertain the quantum / degree of financial distress and the
disability of the company to pay off its liabilities. If the ratios indicate a threat to the going concern
assumption of the company, we may also report the same in the main Audit report in addition to
CARO report.

15. Reporting with respect to Corporate Social Responsibility (CSR)

 New clauses have been introduced requiring reporting whether in relation to ongoing
CSR projects, unspent amount has been transferred to Special account within stipulated time as
mandated by Section 135 of Companies Act, 2013. Further, we are also required to report the
details of transfer of unspent CSR money with respect to other than ongoing projects as specified
in Schedule VII within the stipulated period as per Section 135 of Companies Act, 2013.
This clause could have been introduced in line with the recent amendments in Companies
Act, 2013 imposing penalties and prosecution of Directors in case of non-compliance with CSR
provisions. Before implementation of these amendments, non-spending of the minimum
required CSR expenditure only required mere reporting in the notes accompanying and forming
part of financial statements without any penal provisions due to which the very purpose of
Corporate Social Responsibility was defeated. Therefore, the above referred amendments were
introduced to inculcate seriousness among big corporates towards their social responsibilities.
Accordingly, it makes sense to introduce this reporting requirement in our Audit report as well.
In order to report under this clause, we may collect the CSR policy copy of the company
and verify the amount spent in detail. Further, in respect of ongoing projects, we may collect
technical reports from competent professionals estimating the balance outlay of funds required
and whether the same is set aside in separate bank account and meets the minimum required
spending. With respect to other than ongoing projects, we may collect the special bank account
maintained for this purpose and verify the transactions therein.

16. The clause with respect to the reporting of Managerial remuneration has been omitted from CARO
2020

Conclusion

All of this said, each audit is different and dynamic. There cannot be hard and fast rules
set to conclude a particular audit because audit itself is a highly subjective process. Due to well-
crafted fraudulent activities coming into light each day, there could be instances where we might
need to wear the skin of a blood hound and step outside the soul of a watch dog in order to
protect our own interest too among the interest of various stakeholders and regulatory bodies.
Pure judgment and reliance on reports of other professionals may be required in more instances
than we can think of, and we must remember the reason why the concept of Audit report is
introduced in first place, and we must step into the shoes of the stakeholders and regulatory
authorities to understand the end objective of the entire process. We must at all times keep our
eyes, ears and trust our instincts and read & interpret any possible triggers, after all it is from
these small factors that most big crimes are brought into light. This, however, does not mean that
we end up harassing the companies by using nothing but entirely skeptical approach to conduct
the audit. We must also understand the practical difficulties faced in the industry. The crux is to
say, we are given utmost responsibility and accountability and the Audit report is an indispensable
tool in our hands to express our opinion to stakeholders for their decision making.

Disclaimer: This piece of work is purely based on my judgments and based on my opinion and
understanding of the law and reporting requirements. This is not an actual representation of
the legal interpretation but is only to express my views based on my practical experiences and
exposures to various audits.
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