Interview Questions

HR Round

Q. Tell me about yourself.

Firstly, thank you for giving me the opportunity to be a part of this interview. My name is __ and I come
from __. I am a ca final student cleared intermediate exam in recent attempt and secured rank/ scored
exemptions in __ subjects. I am also perusing (course) from (college). I am an enthusiastic and
determined person. My hobbies are __.
Note: The interviewer may ask a question from hobbies that “If your hobbies are (__), then why didn’t
you choose that as your career?” Ans- for eg- your hobby is singing. So the ans can be framed as I love
to sing during my free time but, I am not that good at it/ I want to first get a stable job and earning in
life and after that I can think about it.

Q. Why CA?
1. For making parents proud
2. Respect in society
3. Interest in finance and accounts
4. Gaining knowledge, etc.

Q. Why Statutory Audit/Internal Audit?

1. Helps in professional growth
2. Helps in getting exposure of different industries
3. I have good problem solving skills
4. Detail oriented work

Q. Difference between internal and statutory audit.

Basis Internal Audit Statutory Audit

Independence Have less independence Have greater independence
Accountability Accountable to the management Accountable to shareholders and
investors
Work involves It involves reporting of work to They provide an opinion on the
the audit committee. They get truthfulness of the company’s
involved in designing the FS.
organizational and control
system.

Q. Why should be hire you?

I have skills required for this role. I am a hardworking person, quick learner, eager to learn new
experience, easily able to adapt to changes.

Q. What do you know about us?

- Read about the firm’s history, memorize a few achievements and the CEO/ Chairman’s name
Q. What are your strengths and weakness?
Strengths: Quick learner, good listener, problem solving attitude, self motivated, confident, good
communication skills, etc.
Weakness: Get easily anxious, emotional, etc.
Note: After this a question may be asked “Explain by giving an example from real life scenario that
makes you a (your strengths)?” Ans- You can explain by giving an example for the strengths you
mentioned.

Q. Where do you see yourself in 5 Years?

- A better version of myself
- I would have cleared CA
- Contributing to the growth of a big firm/ would have started my own practice.

Q. Why this firm?

- Mention the values of the firm
- The firm will help me gaining practical knowledge and skills
- The firm provides great opportunities to learn and grow.

Q. How will you manage work pressure?

- Being organized
- Keeping note of the deadline of tasks
- Not keeping any work pending
- Prioritizing tasks effectively

Q. How will you manage CA final studies and work?

As I am a very good planner, I will plan my studies and work and make an organized schedule so both of
them are not compromised.

Q. Will you able to work for long nights?

I am night owl so; I don’t think a problem regarding the same will arise.

Q. Are you comfortable with travelling?

(Always say yes.)

Q. Are you willing to relocate? (If applying in some other city)

Q. Do you have any questions for me?

- Can you tell me about the company’s culture?
- Can you tell me about some qualities that an article of your firm should have?
- Can you give me a feedback of this interview?

Q. Have you read about any recent news related to the firm?
Q. Do you prefer working alone or working in team?
I believe both have their own advantages and limitations.
Working alone: Benefits: Lack of disagreements as I will be the only one so will handle tasks my own way.
Limitations: Too much pressure and burden on single person, lack of creativity
Working together: Benefits: More ideas, work will be divided so members are not burdened.
Limitations: May lead to quarrels and disagreements along the team members that can delay the task.

Q. Tell me 3 things that motivate you?

- Growth Opportunities
-Challenging tasks
- Appreciation
- Opportunity to learn new things

Q. What are your expectations from us?

Giving me opportunities to learn new things, gaining practical knowledge, and insight about the industry.

Q. Give me some news headlines you read today.

Q. Tell me something that is not in your resume.

Q. What do you think are the key qualities of a successful CA?

- Aware about the market
- Practical Knowledge
- Aware about the recent changes in the industry

Q. Describe a time you failed and what you learned from it.

Q. How do you handle stress and pressure?

- Relaxing, listening to songs
- Engaging in hobbies
Technical/ Partner Round
Q. Give me the 3 golden rules of accounting.
- Personal A/c- Dr the receiver, Cr the giver
- Real A/c – Dr. what comes in, Cr what goes out
- Nominal A/c- Dr. Expenses and losses, Cr all incomes and gains

Q. What do you understand by the term materiality?

It is the significance or importance of an item, transaction or information. Item which is significant
enough to influence the opinion of FS?
Q. Factors affecting the determination of Materiality?
- Size/ Amount involved
- Nature
- Entity size and nature
- Legal requirements

Q. What are internal financial controls?

They are the procedures and processes implemented within an organization to ensure the reliability of
financial statements, effectiveness of operations.

Q. What is audit program?

It is a structured plan or set of procedures designed by the auditors to ensure that an audit is
conducted effectively and efficiently.

Q. What are the different types of audit opinion?

Unmodified opinion: The FS is true and fair.
Modified opinion:
- Qualified opinion: Auditor obtained sufficient appropriate audit evidence; misstatements are
material but not pervasive.
Auditor is unable to obtain sufficient appropriate audit evidence; possible effects of
misstatements are material but not pervasive.
- Disclaimer opinion: Auditor is unable to obtain sufficient appropriate audit evidence; possible
effects of misstatements are material and pervasive.
- Adverse opinion: Auditor obtained sufficient appropriate audit evidence, misstatements are
material but and pervasive.

Q. Applicability of Internal Audit.

As per Section 138 of the Companies Act, 2013
- Unlisted public Co. - 25 Cr. Deposits
- 50 Cr. Paid up share capital
- 100 Cr. Borrowings
- 200 Cr. Turnover
- Private Co. - 100 Cr. Borrowings
- 200 Cr. Turnover

Q. What are the 3 main parts of FS?

1. Balance sheet- Financial Position
2. Cash Flow Statement
3. Income Statement: Financial Performance
Q. What is EPS (Earning per share)?
- Net profit- Preference dividend/ weighted average number of shares
- Profit allocated to each outstanding share

Q. What is going concern principle?

Fundamental Accounting Assumption
Business will continue its operations in the foressable future. Company is not facing any financial
distress or intending to liquidate.

Q. Prudence concept
Anticipate for any future/ potential losses and recognizing gain when certain.

Q. Difference between contingent liabilities and provision.

Contingent liabilities Provision
Amount is not certain Amount is known
Shown in notes to Accounts Shown in Balance Sheet
Occurrence depends upon a future event Present obligation due to past event

Q. What is deferred tax?

Tax which will be probable or recoverable in the future due to the difference between taxable income
and accounting income

Q. What is internal Audit?

It provides assurance to the management that the organization’s resources are used effectively,
controls are properly implemented, compliance with laws and regulations. Identify areas for improvement
in process and controls.

Q. What are income/expenses accrued?

Income/ expenses which have been earned or incurred but not recorded in the books.

Q. Methods of depreciation
1. Straight line: Spreading the cost of the asset evenly over its useful life.
2. Written down value method: Higher depreciation in the initial years recognizing that assets often
depreciate more rapidly in the early years.

Q. CARO 2020 applicable on:

Applicable in every company except:
- Banking Co
- Insurance Co
- Section 8 companies
- One person and small company
 - Private limited Co (Not a subsidiary or holding of public Co)
Paid up share capital less than 1 Cr
Borrowing less than 1 Cr
Turnover less than 10 Cr

Q. What motivates your interest in perusing a career in statutory audit?

- Strong foundation in accounting and finance
- I have good analytical skills
- Know about different companies

Q. What is Schedule III of Companies Act?

It provides a format for presentation of financial statements

Q. What is Accumulated Depreciation?

It is the total depreciation that has been recorded for an asset since its acquisition up to a specific
date.

Q. Explain the whole process of Audit

Q. What is sampling and give the types of sampling?

- Types- Statistical and Non- Statistical Sampling

Q. What are different types of materiality?

- Overall Materiality
- Performance materiality
- Specific Materiality

Q. What do you think about the current economy?

Q. Difference between CARO 2020 and CARO 2016

Q. Difference between Limited review and Statutory Audit.

Limited Review Statutory Audit

Do not give opinion on FS Provides higher level of assurance
Narrow scope Expensive audit gathering

Q. Advantages and limitations of internal controls

Q. What is the impact of weak controls on audit?

- Increase the possibility of frauds
- More procedures to test transactions
- Modified audit opinion
- Operational ineffectiveness

Q. What is audit risk and what are its types?

Q. What are limitations of Audit?

Q. How do you understand whether something is material?

- The amount of the item
- Involvement of Senior level management

Q. What are key audit matters?

Q. Companies on which IND AS is applicable

- Listed companies- Net worth 250 Cr.
- Unlisted Companies- Net worth 500 Cr.

Q. What is IND AS 115 and 116?

Q. Recent developments in Audit.

Q. Challenges in Audit

Q. Factors considered to judge the sufficiency of Audit evidence.

Q. Non- performing Asset

Q. Income tax new regime.

Internal Audit
Q. Steps in internal audit.

Q. Difference between management and operational audit.

Q. Decommission liability
Cost that a company expects to levied in the future when the plant shouts down.

Q. Difference between regulatory, statutory and performance audit.

Regulatory audits: Compliance of laws, regulations
Statutory audits: Opinion of FS
Performance audits: Company’s operations- financial performance, management practices conducted by
government agencies or independent auditors.

Q. How do you conduct internal audit?

-P2P
- H2R
- O2C

Q. Defense model

Q. COSO Framework

Q. What is risk control matrix?

A matrix that maps out the risks the organization has and the controls need to address these risks.

Q. What are the key elements in internal audit report? (5 Cs)

- Criteria
- Condition
- Cause
- Consequence
- Corrective action

Q. Suggest some internal control procedures for inventory and fixed assets.

Q. Identify risk in IT systems

Q. What are direct and indirect ELCs? (Entity level Controls)

Note:
A part from these do refer the topic audit procedures in FS items like: Inventory, Tangible fixed
assets, Capital Expenditure, Intangible assets, Revenue, sales, purchases, etc.
Also go through the following topics:
- Key audit matters
- Emphasis of matter
- Other matters
- The opinion section of audit report
- Management responsibility in audit
- Learn all the SA no’s
- Go through the AS specifically, AS-2, 10, 22, 17, 18, 9, 16, 7.
- Also be prepared for the questions like favourite AS and favourite SAs. Make sure you know
everything about the AS/SA that you are planning to speak.