Md. Abdullah Al Muttaki

Internship Report on
“Cash Incentive & Audit Performance of M.J. Abedin & Co.

Chartered Accountants”
Prepared For:
Shahnaz Parvin
Sr. Lecturer and Coordinator of BBA
Department of Business Administration
Bangladesh University
Prepared By:
Md. Abdullah Al Muttaki

ID: - 201911152055
Batch: - 52
Major in Finance
Letter of Transmittal
Shahnaz Parvin
Senior Lecturer, Coordinator of BBA
15/1, Iqbal Road, Mohammadpur, Dhaka 1207
Subject: - Submission of Internship Report on “Cash Incentive & Audit Performance of

M.J. Abedin & Co. Chartered Accountants”
Dear Sir,
I am here by submitting my Internship Report, which is a part of BBA program curriculum. It

is great achievement to work under your active supervision. This report is based on M.J Abedin
& Co.'s cash incentive & audit performance. I had the opportunity to work at MJ Abedin & Co.
for twelve weeks, under supervision of Hasan Mahmood, FCA (partner of M.J. Abedin & Co.
Chartered Accountants).
By working in this organization, I have gained practical knowledge and experience of cash
incentives & audit. I was appointed in the Cash Incentive department there, which helped me
to get firsthand knowledge about the audit firm.
I therefore, hope that report will provide necessary information about Evaluation cash incentive
& audit performance of M.J. Abedin & Co. I will be available at any time convenient for further
clarification on this report.
Your Sincerely,

ID: - 201911152055
Batch: - 52
Major in Finance,
Bangladesh university
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Organization’s Approval Latter
I am pleased to certify that the Internship Report on “Cash Incentive & Audit Performance
of M.J. Abedin & Co. Chartered Accountants”. This report is conducted by Md. Abdullah
Al Muttaki is bearing ID No. 201911152055 student of the Department of Business
Administration has been approved for presentation and defense/Viva-Voce under my
supervision. Md. Abdullah Al Muttaki worked at the “M.J. Abedin & Co. Chartered
Accountants”. I am pleased to hereby certify that the data is findings for presented in the report
are authentic work of Md. Abdullah Al Muttaki. I recommend this report is presented by his
for further academic commendations and defense/viva-voce.
Md. Abdullah Al Muttaki bears a strong moral character and a very pleasing personality. It
has indeed been a great pleasure working with him.
Thanking you,
Harun Mahmud FCA

Partner
M.J. Abedin & Co.
Chartered Accountants
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Supervisor’s Approval Letter
This is to certify that; Md. Abdullah Al Muttaki is a student of Bachelor of Business

Administration (BBA) bearing 201911152055 at the Department of Business Administration,
Bangladesh University. He has successfully completed his internship report on “Cash
Incentive & Audit Performance of M.J. Abedin & Co. Chartered Accountants” under my
supervision as a partial fulfillment for the award of BBA degree.
He has done his job according to my supervision and guidelines. I wish him success and
prosperity.
Thanking you,
Shahnaz Parvin
Senior Lecturer, Coordinator of BBA
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Approval of Head of the Department
This is to certify that the report on Cash Incentive & Audit Performance of M.J. Abedin &
Co. Chartered Accountants, has been submitted for the award of the degree of Bachelor of
Business Administration from Bangladesh University, is an internship work carried out by
Muttaki.
Md. Abdullah Al Muttaki, ID No: 201911152055, Batch: 52, Major: Finance.
He is permitted to submit the Internship Report.
Engr. M.A. Ghulam Dastagir

Secretary, Board of Trustees
Advisor, Dean and Head
Faculty of Business Administration
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Student Declaration
I, Md. Abdullah Al Muttaki, bearing ID: - 201911152055 a student of BBA program Major in
Finance of Bangladesh University do hereby declared that the Internship Report entitles “Cash
Incentive & Audit Performance of M.J. Abedin & Co.” an original work done by me. The
assigned work is by me for partial fulfillment of my BBA degree and as part of the academic
curriculum. It has not been submitted by me for any other degree.
Your Sincerely,

ID: - 201911152055
Batch: - 52
Major in Finance
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Acknowledgement
I would like to thank almighty Allah who has helped me to complete my internship and gave
me ability to finish this Internship report.
I would like to express my utmost gratitude and wholehearted appreciation to all those who
helped me and provided me with the opportunity to complete and present this report.
First of all, I would like to thank my honorable Supervisor, Shahnaz Parvin Senior Lecturer, &
Coordinator of BBA, Department of Business Administration, Bangladesh University for
providing me the opportunity to observe and analyze such an interesting topic and for her
supervision, relentless guidance and invaluable advice whenever needed.
Also, I would like to thank my honorable organizational supervisor, Harun Mahmud FCA,
partner of M.J Abedin & Co. and Hasan Mahmood FCA, Partner, M.J. Abedin & Co. for Giving
me the opportunity to work as an intern in my dream company.
Again, I would like to thank Abdullah Hannan, Manager of Cash Incentive Department in M.J.
Abedin & Co. for help me to complete my internship and its report.
Further, I would also very grateful to my family and friends who were always by my side in
each and every situation.
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Executive Summary
M.J. Abedin & Co. Chartered Accountants is the most reputed and recognized audit quality
firm and it provides Accounting, Audit, Assurance, Tax and Consulting and Advisory. Here
this report title is “Cash Incentive & Audit Performance of M.J. Abedin & Co. Chartered
Accountants” is a result of BBA internship course. So, this report consists the details of the
cash incentive & audit procedures follows by M.J. Abedin & Co. In this report, I have divided
into Seven Chapters.
In Chapter One contains the Introduction of the Study, Objective or Goal of the study,
Significance or Rationale of the study and Limitation of the Study.
In chapter Two, try to review of the literatures. In Chapter Three, include Methodology of the
study which show how I collected data, study area, sampling procedures.
In Chapter Four, Overview of the M.J. Abedin & Co. is given firm’s background, corporate
information, organization structure, number of branch & employees, services schemes and
principal Activities.
In Chapter Five, I have shared about my practical experience and my views in CA firm as an
intern.
In chapter Six, the findings I have found less timing of the cash incentives & audit procedure.
In this firm I was involved with Cash incentive. My experience was three months but I have
identified some problems that firm face in many cases.
In Chapter Seven, I have recognized to carry out audit Procedure of in M.J. Abedin & Co. and
I have drawn an overall conclusion.
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Table of Contents
S. I Description Page No.
Title
Cover Page
Letter of Transmittal i
Joining Letter ii
Organization’s Approval Latter iii
Supervisor’s Approval Letter iv
Approval of Head of the Department v
Student Declaration vi
Acknowledgement vi
Executive Summary vii
Chapter One Introduction

1.0 Introduction 1
1.1 Objectives of the Report 2
1.2 Rationale of the study 2
1.3 Scope of the Report 3
1.4 Limitations of the Report 3
Chapter Two Review of Literatures

2.0 Literatures Reviews 6
Chapter Three Methodology of the Study

3.0 Methodology of the Study 8
3.1 Data Collection Procedures 8
3.2 Study Area 9
3.3 Sampling Procedures 9
Chapter Fore an Overview of the Organization

4.0 Background of The Firm 11
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4.1 Current Structure & Strength 11
4.2 Number of Manager 13
4.3 Number of students 13
4.4 Number of Employee 13
4.5 Mission of MJA 14
4.6 Vision of MJA 14
4.7 Services of MJA 14
4.8 Their approach 15
4.9 M.J. Abedin & Co. Commitment to Quality 16
Chapter Five Discussion Analysis and Interpretation of the Result

5.0 What is Cash Incentive 18
5.1 History of Cash Incentive 19
5.2 Reasons for giving Cash Incentive Facility 20
5.3 Cash Incentive Background of M.J. Abedin & Co. 20
5.4 Engagement of Procedure 21
5.5 Process of Cash Incentive Department in M.J. Abedin & Co. 22
5.6 Performance of Cash Incentive 23
5.7 Government Control in Cash Incentive Process 23
5.8 Limitation of Cash Incentive procedure 23
5.9 Financially Benefited from Cash Incentive Department of M.J. 24
Abedin & Co.
5.10 General Definition of Assurance 24
5.11 The Key Element of an Assurance Engagement 24
5.12 Level of Assurance 26
5.13 General Definition of Audit 26
5.14 Stages of an Audit 27
5.15 Overall Objective of the Auditor 27
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5.16 Obtaining an engagement 28
5.17 Appointment considerations 28
5.18 Appointment decision Chart 31
5.19 Audit engagement letter 32
5.20 Planning 33
5.20.1 Understanding the entity and its environment 35
5.21 Analytical procedures 36
5.21.1 Analytical procedures in planning the audit 36
5.22 Materiality 37
5.23 Audit Risk 38
5.23.1 Identifying and assessing the risks 39
5.23.2 Significant risks 39
5.24 Evidence 40
5.24.1 Sufficient appropriate audit evidence 41
5.24.2 Financial Statement assertions 42
5.25 Reporting 42
5.26 Internal Control 43
5.27 Documentation 44
5.27.1 Form and content of documentation 44
5.27.2 Automated working papers 44
5.27.3 Filing working papers 45
Chapter Six Findings of the Study

6.0 Finding 48
Chapter Seven Conclusion & Recommendations

7.0 Conclusion 50
7.1 Recommendations 50
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Bibliography & Appendix

References ii
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Chapter – One
Introduction
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1.0 Introduction
We know internship is a basic part of BBA (Bachelor of Business Administration) program that
provides an on-the-job experience to students. Sensational academic knowledge & sensible
training is not the same theme. Humorous academic knowledge is fulfilled when it can be used
in a practical field. So, ambition of placement is to apply one is academic knowledge in practical
fields. So, Internship is a realistic application of knowledge & acquiring practical experience
by wining oneself in several and different sectors of work. For that reason, internship program
is also included in the curriculum of BBA in Bangladesh University which is undertaken in
several organization of the country.
I have also completed my internship program at the M.J. Abedin & Co. Auditing system
occupies an important place in a nation’s economy because of its intermediary role; it ensures
that companies annual financial statements are fairly presented and at the same time it provides
high quality, reliable information in the market and reduces the risk of management bias fraud
and error. An audit firm is indispensable in a modern society. It plays a pivotal role in the
economic development of a country and establishes policies and procedures to ensure that the
firm and all those involved in the audit, act with integrity, objectivity and independence.
All of the chartered accountancy firms are now playing an important role in Bangladesh
economy and it also create huge number of employments. In Bangladesh the chartered
accountancy firms are divided by 3 types and the types are:
1) Large Corporate Firms

2) Medium Firms and
3) Small Practicing Firms
Large Corporate Firms are built big multistoried building and mostly located in Dhaka and
Chittagong. These types of firms serve a wide range of auditing services across all over
Bangladesh.
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The Medium Firms are built only the residential building and serves auditing services as wide
as possible in term of their relative range of expertise.
The small firms serve only in some specific area such as personal taxation services and
consultancy services.
There is consecutive Seven parts of this report elaborating at M.J. Abedin & Co. in a manner
of information were available while working as an active intern at the firm.
Therefore, it was handful to accumulate information broadly regarding auditing procedures of
the firm and some of its policies in term of performing an audit.
Despite of being a Large Corporate Firms in nature this firm serves Accounting, Audit,
Assurance, Tax and Consulting and Advisory services in a very wide range which was an
opportunity to learn from an evolving organization.
1.1 Objectives of the Report
1. The broad objective of the report is to find about Cash Incentive & auditing procedures
of Chartered Accountancy firms, how it runs and what functions it does.
2. To know about the servicing procedures insights of M.J. Abedin & Co.
3. To find out whether M.J. Abedin & Co. comply with all the cash incentive & auditing
standards and regulator’s requirements
4. To provide recommendations based on the findings of the report.
1.2 Rationale of the study
The main purpose of internship is to get the student exposed to the job world and this study is
a partial requirement of the internship program of BBA curriculum at the Bangladesh
University. This report is the result of three months long internship program conducted in “M.J.
Abedin & Co.” and is prepared as a requirement for completion of the BBA program of
Bangladesh University. As a result, it needed to submit this report based on the “Cash Incentive
and audit performance of M.J. Abedin & Co.” This report also includes information on the
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services of M.J. Abedin & Co. Again, the overview of the organization and also services they
offer to satisfy their clients.
1.3 Scope of the Report

There is a certain boundary to cover this report. This report is particularly only “Cash Incentive
& Audit Performance of M.J. Abedin & Co.” It mainly focuses on Cash Incentive, auditing and
consultancy activities of this firm. For this report communicate with M.J Abedin & Co. and
was able to collect some confidential information which is not possible to disclose publicly, so
those data and information had to be ignored for this report.
1.4 Limitations of the Report
Any research work needs high degree of involvement regarding collection of information,
creation of data base, literature review and analysis of data. While doing so, many limitations
arise even though always put best effort to avoid them. Some limitations arise even though
always put best effort to avoid them. Some limitations are mentioned below:
➢ Shortage of time:
Within a short time, to work in the firm and need to prepare report for this session. For
this reason, could not get a fluent time schedule for the report. I had only 12 weeks in
my hand to complete this report, which was not enough. So, I could not go in depth of
the study. Most of the times the officials were busy and were not able to give us much
time.
➢ Difficulty in collecting data:
Many employees of the firm were not well known about all information that were asked
them. Many of them also hesitated to answer all the questions. These factors hampered
the process of information collection.
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➢ Confidential data:
Got some confidential data which is not possible to disclose publicly, so these data and
information had to be ignored for this report. In spite of all these limitations tried to put
the best effort as far as possible.
➢ Other limitation:
As a newcomer, there is a lack of previous experience in this concern. And many
practical matters have been written from our own observation that may vary from person
to person.
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Chapter – Two
Review of Literatures
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2.0 Literatures Reviews: -
Both these phenomena of Cash Incentive and Audit Performance are defined by several ways.
(Kleijn & Leeuwen, 2018) Defines "Auditing is the procedure by which a competent,
independent individual gathers and evaluates evidence regarding quantifiable information
related to a specific economic entity to evaluate and report on the degree of connection between
the quantifiable information and predetermined requirements."
Numerous studies have been conducted on the effectiveness of audits, but very few studies have
been conducted on the effectiveness of audit policy. (Baatwah & S.R., 2019) It was decided
that the audit policy's success would be measured by criteria other from those specified in the
audit practice handbook. In his opinion, the criteria should take into account the audit company's
leadership and organizational structure, the auditor's independence, the significance of the audit
to the firm, the expertise of the firm's partners and workers, and the significance of the audit
itself. The depth and breadth of the auditing team's expertise.
Some very important concepts are included in this definition. The following concepts are: -
➢ Competent, Independent Person

➢ . Accumulating and Evaluating Evidence
➢ Economic Entity
➢ Reporting
All the previous internship reports of an audit firm cover only audit procedures and some
practical examples when someone works as an intern.
This report discusses not only the audit methodology but also the audit performance of M.J.
Abedin & Co. The report also discusses the cash incentive system and its effectiveness. which
does not discuss the past in depth.
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Chapter – Three
Methodology of the Study
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3.0 Methodology of the Study
I have prepared this report on the basis of my experience gathered and from the assistance of
our seniors as well as respected sir. The methodology of the study mainly supplies the statistical
methodology in collecting data and necessary analysis on different applicable laws and act.
3.1 Data Collection Procedures
Sources of Data:
The data & information of this report have been collected from both the primary and secondary
sources. In order to prepare this report, I have been collected necessary information from two
types of sources as follows:
Sources of Data
Primary Source Secondary Source
Figure 3.1: - Data Collection Procedures
I. Primary Sources:
➢ Personally collected data from officers.
➢ Collecting primary data by several audit teams and working in cash incentive.
➢ Discussing with all manager, staff, and partners also articled students.
➢ Circulars published by Bangladesh Bank.
➢ Consideration in objective factory visit.
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II. Secondary Sources:
➢ Studied various accounting books and journal.
➢ Studied Bangladesh Standard on Auditing.
3.2 Study Area

M.J. Abedin & Co. is a professional organization. It provides Accounting & Assurance Service.
As an intern I work in Cash Incentive department which is audit on cash assessment who claim
alternative cash assessment as Bangladesh Bank circular.
3.3 Sampling Procedures

As an intern in M.J. Abedin & Co. I collect my data from Management and Contract person to
person who is work and study here.
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Chapter – Four
An Overview of the
Organization
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4.0 Background of The Firm
M/S. M. J. ABEDIN & CO, (MJA) Chartered Accountants, a Seven-Partner Partnership Firm,
was established in 1965 and presently practicing with the permission from the Institute of
Chartered Accountants of Bangladesh (ICAB). From inception, MJA partners have been
undertaking complex, intricate and challenging auditing as well as financial consulting services
to gain and earn reputation locally. Gradually, the firm was appointed by the multinational
companies, ADB, IDA, KFW, SIDA and GoB financed projects. Their skilled and experienced
auditing experts are being hired by the overseas auditing firms to conduct financial and
performance auditing and evaluation and reviews of procurements in line with Bangladesh
Standard on Auditing (BSAs) and guidelines issued and adopted by the World Bank, Asian
Development Bank, European Union and KFW of Germany.
MJA is mainly engaged in financial and performance audits. It may be mentioned here that
every auditing task includes the activities of in-depth investigation, analysis, validation and
confirmation of information gathered from the field visit and examination of books of accounts,
financial and non-financial information to form an idea to express the professional opinion.
This Firm, at present, is capable to engage a good number of consultants and skilled consulting
staff at international standard level to carry out, implement and execute the all technical as well
as non-technical evaluation tasks, survey, investigation and data administration and
management along with required analysis.
4.1 Current Structure & Strength
At present M. J. ABEDIN & CO consists of seven partners (Seven Fellow members of the
ICAB) with a cumulative experience of over hundred (133) years possessing diverse expertise
in auditing, accounting, taxation, secretarial service, corporate finance, stocks and consultancy
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in public offering and fund raising and performance audit of various national and multinational
organizations.
MJA operates its main business office at Dhaka. MJA is well equipped with adequate logistic
and manpower to support the ever-growing needs of clients.
Apart from that MJA has a panel of eminent personalities on its pool of “resource personnel”
who are engaged on job basis where the specialized services are required. Professionals like
economists, cost accountant, engineers, lawyers, financial analyst, DEP and system analyst are
in the pool of the said resource panel. These professionals are engaged by MJA on job-to job
basis, as required, and directly supervised by the partners. Major strength of MJA is its exposure
and experience in the statutory and internal audit of Banks and Non-Financial Institutions. Since
inception MJA has been engaged in the audit of Banks, Non-Banking Financial Institutions,
Insurance Companies. Besides, MJA is engaged in the financial audit of a large number of
organizations under Government and Private sector. Moreover, MJA has significant exposure
in providing taxation and secretarial services to its major clients.
The number of Full Time Partners (resident) in the Chartered Accountancy Firm
ICAB ICAB
Area of Length if
Sl Name Enrolment Enrolment
Experience Experience
Number Date
01. Mr. Md. Jainul Abedin Chartered 64 09 01 Jul 1958
FCA Accountant
02. Mr. Md. Manzoor-ul Chartered 42 258 22 Jun 1980
Alam FCA Accountant
03. Mr. Kamrul Abedin Chartered 36 527 13 Aug 1986
FCA Accountant
04. Mr. Hasan Mahmood Chartered 33 564 02 Feb 1989
FCA Accountant
05. Mr. Harun Mahmud Chartered 17 850 26 Aug 2004
FCA Accountant
06. Mr. Hanif Mahmud Chartered 13 1094 22 Jan 2009
FCA Accountant
07. Mehzabeen Ahmed Chartered 1769 21 Aug 2016
Naveen FCA Accountant
Figure 4.1: - The number of Full Time Partners (resident) in the Chartered Accountancy Firm
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4.2 Number of Manager: -
There are Fourteen Manager of this firm to continue their activities. Such as: -
1. ATM Kamal Uddin Ahmed

2. ATM Jasim Uddin
3. Afreen Ahmed
4. Ishmam Rahman Abedin
5. Shadman Yasar Mahmud
6. Mashiat Nawaal Mahmood
7. Faiza Rahman Abedin
8. Mr. Md. Osman Ali
9. Almamun
10. Md. Nur Alam
11. Md. Abdul Hannan
12. Tapos Biswas
13. Md. Shariful Islam
14. Md. Murad Hossain
4.3 Number of students: -
In this firm current 31 students who complete their course and 85 students are running article
ship course also 10 students are under processing to registered to ICAB.
4.4 Number of Employee: -
In this firm are 15 employees. Those employees are maintaining internal activities of this firm.
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4.5 Mission of MJA: -
Their Firm ensures Quality, Confidentiality, Integrity and On-time execution.
4.6 Vision of MJA: -
To be one of the top 10 firms in Bangladesh. Set firm entire business plan keeping around firm
vision. Professionals are striving to reach firm vision at an earliest time.
4.7 Services of MJA: -
They Provide the Following Services to their Clients: -
1. Statutory Audit
2. Performance Audit
3. Internal Audit
4. Due Diligence
5. Cash Incentive Certification
6. Remittance Certification
7. Financial System Design and Installation
8. Accounting Manual and Chart of Accounts Preparation
9. Fixed Asset Register Preparation
10. Other Assurance Services on Agreed upon Procedures
11. Corporate Accounting
12. Government and Fund Accounting
13. Company Formation and Other Related Secretarial Services
14. Setting up Liaison Office
15. Work Permit for Expatriates
16. Assistance in Recruiting Accounts Personnel
17. Setting up Provident Fund/Gratuity Fund
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18. Financial Analysis & Projection
19. Revenue Collection Evaluation
20. Inventory Management
21. Efficiency Review
22. Financial and Management Consulting
23. Investigation
24. Operation and Management Study
25. Project Appraisal
26. Corporate and Business Law Matters
27. Taxation Planning
28. Corporate and Personal Tax
29. Payroll and Other Business Process Outsourcing
4.8 Their approach: -
Their approach is to deliver relevant and intelligent solutions to our clients. They listen to our
clients’ needs and take the time to understand their expectations.
1. They pride themselves on delivering the highest standard of professional services to our
clients in a timely, professional and intelligent manner.
2. they work in collaboration with our clients to ensure they achieve their objectives.
3. They services focus on our clients’ requirements with a good understanding of their
needs.
4. Their client portfolio is broad and consists of publicly listed corporations, large and
medium-sized companies, privately owned businesses, not-for-profit and public
organizations
5. As a member of Moore Global Network Limited (U.K), our firm is able to offer
specialist sector and country knowledge to the same high quality professional standards
in major international business centers
6. They share our clients’ aspirations and deliver customized, timely advice to help you
make the right business decisions
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7. They drive for professionalism, quality, integrity and innovation combined with global
reach have realized substantial growth in our longstanding history for both clients and
member firms.
4.9 M.J. Abedin & Co. Commitment to Quality
Quality is one of our main values – because it is so very important to us they strive to achieve
this in everything we do. their firm is committed to provide the highest level of quality services
while achieving the desired objectives of the assignment.
They focus on quality through:
➢ Leadership
➢ Client acceptance procedures
➢ Compliance with ethical obligations set out by the International Federation of
Accountants in its global standard, Code of Ethics for Professional Accountants
➢ Human resources policies and procedures, such as education and training
➢ And, of course, quality control procedures in accordance with internationally
recognized standards.
It is our belief in quality as a value and the successful implementation of that value across all
our service areas that make us even more dedicated to quality.
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Chapter – Five
Discussion Analysis and
Interpretation of the Result
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Cash incentive Procedure & Performance of M.J. Abedin & Co.
5.0 What is Cash Incentive: -
Cash incentive is a tool to increase export and expand new market. Our economy is highly
depending on export. To encourage the export related activities our government has taken many
steps incentive is one of them. Cash incentive is the assistance in the form of “Cash” given to
any party on its fulfillment of certain conditions.
Bangladesh government provides three options to the final exporter:
➢ Duty drawback
➢ Bonded warehouse
➢ Cash incentive.
In case of Duty drawback, the exporter does not have to pay any kind of duty in the port. In
addition, under bonded warehouse facility exporter does not have any warehouse fee to keep
their goods for the necessary time they need. On the other hand, cash incentive can be taken
from the total exported value of the ultimate exported goods but it is given based on the realized
amount. It is up to the exporter for which they will apply for. Generally, most of them go for
the cash incentive. According to the Circular of Bangladesh Bank, “If any exporter takes Duty
drawback or Bonded warehouse facility, they will not get any cash incentive”. Exported goods
that are produced locally gone through a total procedure in Bangladesh will be eligible for
application of cash incentive. There are different rates for different types of exportable goods
which are determined by Bangladesh Bank. For example, in textiles or garments sector 4% cash
incentive is provided on the realized amount of the exported goods. Suppose, the L/C amount
is USD 7,00,000 Export amount was USD 5,50,000and realized amount is USD 5,00,000. They
will get incentive of USD 16,000 (USD 5,00,000 * 80%* 4%), if there is no wastage. Maximum
80% of realized amount is considered for calculating cash incentive.
All of the formalities of cash incentive will be done by the applicant and the bank. Previously,
many exporters received cash incentive by adopting unfair means. Hence, to avoid dishonest
approaches by the exporter it is forwarded to a Bangladesh Bank nominated audit firm for
providing certificate mentioning the actual amount to be paid by the Bangladesh Bank.
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5.1 History of Cash Incentive: -
This scheme was first introduced in 1994 as ‘Cash Compensatory Scheme (CCS)’ as a
motivating mechanism to increase export and also to establish the backward linkage. At that
time this facility was made available to RMG and special textile units which are either not
covered by or choose not to use the bonded warehouse facilities and duty draw back facilities.
The rate of Cash Incentive was 15% of FOB export value. This facility was introduced for the
economic development of the country by increasing export through establishing backward
linkage, so that they are encouraged to procure their raw material from in land. These facilities
are provided only those who use their raw materials from the country not from other country.
When Govt. observed that this facility increases the total export, and use of local raw materials
in the production then the government expanded these facilities to several sectors such as,
Frozen Shrimp, Jute, cargo, bicycle etc. From the total export earnings Bangladesh earns more
than Seventy six percent by textile sector. For these reasons, in 1994 the Govt. decided to
provide cash incentive to the producer, and suppliers of fabrics used to get cash incentive from
the Bangladesh Bank through their negotiating bank. Here also the same condition as, not to
use the bonded warehouse facilities and duty draw back facilities had been taken for the material
used in the production of textile and other sectors.
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5.2 Reasons for giving Cash Incentive Facility: -
The main reasons for providing cash incentive facilities are: -
➢ To increase total export of the country.

➢ To establish the backward linkages of different sectors.
The other reasons for giving cash incentives which are directly or indirectly related to the
facility are:
➢ To increase foreign remittance and to increase the foreign currency reserve.

➢ To use the local raw materials instead of foreign raw materials for example- using local
yarn instead of foreign yarn in garments industries.
➢ To make competitive the local raw materials and finished products of some selected
sectors such as fabrics and garments sector against that of the neighboring countries like
India and Thailand etc. Because the price of produced yarn in our country is more than
that of India and Thailand and the price of accessories used in our garments sector is
also comparatively higher than that of the neigh boring countries.
➢ To facilitate more value addition in different sector. For example, if the cash incentives
are given than the garments sector will not import foreign yarn and accessories and will
use locally produced yarn and accessories and for this local value addition will be
increased.
➢ To expand new market for export.
5.3 Cash Incentive Background of M.J. Abedin & Co.
At the beginning of Cash Incentive in Bangladesh, Exporter Claim for cash incentive to and
Bank Cheek all of the document where exporter provide as per Bangladesh Bank circular, if
bank find any wrong those document bank provide requisition to current those wrong. When
Exporter current all of those wrong then bank recheck the document and deposit cash incentive
exporter account. But civil auditor found lot of corruption in this process. After that Bangladesh
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Government decided to provide this responsibility to audit firm to audit cash incentive
document as per Bangladesh Bank circular.
Audit firm started audit on cash incentive after 2000. But M.J. Abedin & Co. open cash
incentive service in 2008. Now they continue this service as per Bangladesh Bank circular.
5.4 Engagement of Procedure: -
When M.J. Abedin & Co. Contract any Bank to audit a certain period of time then firm also
access to audit cash incentive when any Exporter claim cash incentive this bank as per
Bangladesh Bank circular. When the bank's audit contract with the firm ends, the bank's cash
incentives also cease to be audited.
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5.5 Process of Cash Incentive Department in M.J. Abedin & Co.: -
The processes of Cash Incentives Department of MJ Abedin & Co. are given in the flowchart
below: -
Export
Claim cash incentive

in a Bank
Bank receive incentive file

and send to audit firm claim
incentive document
firm receive claim

incentive document
from bank
Exporter correct/send
Auditor audit on claim requisition document to
incentive all document as audit firm
per BB circular
Have any
requisition Requisition
? sends to
Exporter
Send certificate to Bank cash

incentive
Figure 5.1: Flowchart of Cash Incentive Process
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5.6 Performance of Cash Incentive: -
One of the top ten firms is M.J. Abedin & Co. If I compare other firms with M.J. Abedin & Co.
performance in cash incentive department is average. They are not behind others but ahead in
some areas.
5.7 Government Control in Cash Incentive Process: -
When audit firm audit on claim incentive document and provide certificate that bank can pay
certain amount if everything is current as per Bangladesh Bank circular. After this process civil
auditor recheck the claim incentive document for something went wrong. If they find any kind
of wrong or corruption civil auditor block the payment and return the document to audit firm
who audit this. Sometime they can take action any kind of corruption.
5.8 Limitation of Cash Incentive procedure: -
In cash incentive process have some limitation. When Bank receive and check incentive
document the have to do this three working day but so may claim document bank can’t do this
in those working day. After this process bank send it to audit firm to audit this document. Audit
firm have to check this incentive document seven working day. But sometime it is not possible
to check those documents in this short time. Because they also receive cash incentive file from
others bank. When auditor check document they find some mistake and wrong information in
cash incentive document. They send requisition to the claim bank and Exporter. Some time they
delay to fulfill those mistakes or wrong.
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5.9 Financially Benefited from Cash Incentive Department of M.J.
Abedin & Co.: -
In 2020, M.J. Abedin & Co. financially benefited 21.77% of total revenue which come from
Cash Incentive department. And in 2021, 11% of total revenue and 2022 10.5%.
Audit Procedure & Performance of M.J. Abedin & Co.
5.10 General Definition of Assurance
International Federation of Accountants (IFAC) define assurance engagement as: -
“An assurance engagement is one in which a practitioner expresses a conclusion

designed to enhance the degree of confidence of the intended users other than the responsible
party about the outcome of the evaluation or measurement of a subject matter against criteria.”
5.11 The Key Element of an Assurance Engagement
The key elements of an assurance engagement are as follows:
Three people or groups of people involved
➢ The practitioner (accountant)

➢ The intended users
➢ The responsible party (the person(s) who prepared the subject matter)
A subject matter
The subject matter of an assurance engagement may vary considerably. However, it is likely to
fall into one of three categories:
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➢ Data (for example, financial statements or business projections)
➢ Systems or processes (for example, internal control systems or computer systems)
➢ Behavior (for example, social and environmental performance or corporate governance)
Suitable criteria
The person providing the assurance must have something by which to judge whether the
information is reliable and can be trusted. So, for example, in an assurance engagement relating
to financial statements, the criteria might be accounting standards. The practitioner will be able
to test whether the financial statements have been put together in accordance with accounting
standards, and if they have, then the practitioner can conclude that there is a degree of assurance
that they are reliable.
In the context of company behavior, suitable criteria to judge whether something is reliable and
can be trusted might be the Combined Code on Corporate Governance, or, if the company has
one, its published Code of Practice.
Sufficient appropriate evidence to support the assurance opinion
The practitioner must substantiate the opinion that he draws in order that the user can have
confidence that it is reliable. The practitioner must obtain evidence as to whether the criteria
have been met. We will look at the collection of evidence in detail later in this Study Manual.
A written report in appropriate form
Lastly, it is required that assurance reports are provided to the intended users in a written form
and contain certain specified information. This adds to the assurance that the user is being given,
as it ensures that key information is being given and that the assurance given is clear and
unequivocal.
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5.12 Level of Assurance
There are two types of Assurance engagement such as
➢ Reasonable assurance engagement: -

A high level of assurance that is less than absolute assurance, that engagement risk has
been reduced to an acceptable low level, which then allows a conclusion to be expressed
positively.
➢ Limited assurance engagement: -
A meaningful level of assurance, that is more than inconsequential but is less than
reasonable assurance, that engagement risk has been reduced to an acceptable level,
which than allows a conclusion to be expressed negatively.
5.13 General Definition of Audit
An audit is historically the most important type of assurance service in Bangladesh. This is
because all Limited Liability companies registered with the Registrar of Joint Stock Companies
have been required by law to have an audit.
“The objective of an audit of financial statements is to enable the auditor to express an

opinion whether the financial statements are prepared, in all material respects, in accordance
with an applicable financial reporting framework.”
The key outcome of the statutory audit is the audit opinion. In Bangladesh, the auditor will
normally express his audit opinion by reference to the ‘true and fair view’, which is an
expression of reasonable assurance. Whilst this term is at the heart of the audit, ‘true’ and ‘fair’
are not defined in law or audit guidance. However, for practical purposes the following
definitions are generally accepted.
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5.14 Stages of an Audit
Obtaining the engagement
Planning
Performing procedures
Review and completion
Reporting
Figure 5.2: - Stages of an Audit
5.15 Overall Objective of the Auditor
ISA 200 states that the overall objectives of the auditor are: -
1. To obtain reasonable assurance about whether the financial statement as a whole is free
from material misstatement, whether due to fraud or error, thereby enabling the auditor
to express an opinion on whether the financial statements are prepared, in all material
respects, in accordance with an applicable financial reporting framework
2. To report on the financial statements, and communicate as required by the ISAs, in
accordance with the auditor’s findings.
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5.16 Obtaining an engagement
➢ Accountants are permitted to advertise for clients within certain professional guidelines
➢ Accountants are often invited to tender for particular engagements, which means that
they offer a quote for services, outlining the benefits of their firm and personnel usually
in competition with other firms which are tendering at the same time.
5.17 Appointment considerations
Schedule C of ICAB Code of Ethics as well as IFAC Code of Ethics sets out the rules under
which accountants should accept new appointments. Before a new audit client is accepted, the
auditors must ensure that there are no independence or other ethical issues likely to cause
significant problems with the ethical code (i.e., significant threats to complying with the
fundamental principles of ethical behavior). Furthermore, new auditors should ensure that they
have been appointed in a proper and legal manner
The nominee auditors must carry out the following procedures.
Acceptance procedures
Ensure professionally qualified to act Consider whether disqualified on legal or
ethical grounds, for example if there would
be a conflict of interest with another client.
Ensure existing resources adequate Consider available time, staff and technical
expertise.
Obtain references Make independent enquiries if directors not
personally known.
Communicate with present auditors Enquire whether there are
reasons/circumstances behind the change
which the new auditors ought to know, also
as a matter of courtesy.
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Some of the basic factors for consideration are given below.
➢ The integrity of those managing a company will be of great importance, particularly if

the company is controlled by one or a few dominant personalities.
➢ The audit firm will also consider whether the client is likely to be high or low risk to the
firm in terms of being able to draw an appropriate assurance conclusion in relation to
that client. The following table contrasts low and high-risk clients.
Low risk High risk

Good long-term prospects Poor recent or forecast performance
Well-financed Likely lack of finance
Strong internal controls Significant control weaknesses
Conservative, prudent accounting policies Evidence of questionable integrity, doubtful
accounting policies
Competent, honest management Lack of finance director
Few unusual transactions Significant unexplained transactions or
transactions with connected companies
The audit firm will generally want the relationship with a client to be long term. This is not only
to enjoy receiving fees year after year; it is also to allow the audit work to be enhanced by better
knowledge of the client and thereby offer a better service.
Sources of information about new clients

Enquiries of other sources Bankers, solicitors
Review of documents Most recent annual accounts, listing
particulars, credit rating
Previous accountants/auditors Previous auditors should be invited to
disclose fully all relevant information
Review of rules and standards Consider specific laws/standards that relate
to industry
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Prospective auditors should seek the prospective client’s permission to contact the previous
auditors. If this permission is not given, the prospective auditors should consider carefully the
reason for such refusal when determining whether or not to accept the appointment. Normally
permission will be given, so the prospective auditors can write to the outgoing auditors.
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5.18 Appointment decision Chart
Approach by Potential
new audit client
Yes
Is this the Prospective auditor can make own decision
first audit
NO
Does client give NO

permission to
contact to the
old auditor?
Yes
Write for all information Prospective an auditor should
pertinent to the normally decline the
appointment appointment
Does client give

old auditor
permission to
reply?
Yes
Does old auditor

reply with NO Give old auditor due notice then decide
information on basis of knowledge obtained
relevant to new otherwise
appointment?
Yes
Accept/reject appointment
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Figure 5.3: - Appointment decision Chart
The following procedures should be carried out after accepting nomination.
➢ Ensure that the outgoing auditors' removal or resignation has been properly conducted
in accordance with national legislation. The new auditors should see a valid notice of
the outgoing auditors' resignation, or confirm that the outgoing auditors were properly
removed.
➢ Ensure that the new auditors' appointment is valid. The new auditors should obtain a
copy of the resolution passed at the general meeting appointing them as the company's
auditors.
➢ Set up and submit a letter of engagement to the directors of the company.
5.19 Audit engagement letter
Auditing standards require that the auditor and the client should agree on the terms of the
engagement. The agreed terms must be in writing and the usual form would be a letter of
engagement. Any other form of appropriate contract.
The following items should be included int the engagement letter
➢ The objective of the audit of financial statements.

➢ The scope of the audit, including reference to applicable legislation, regulations, or
pronouncements of professional bodies to which the auditor adheres.
➢ The auditor’s responsibility.
➢ The reporting framework that is applicable for the financial statement being prepared
such as IFRS
➢ Management's responsibility for the financial statements.
➢ The form of any reports or other communication of results of the engagement.
➢ The form of any reports of results of the engagement.
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The auditor may wish to include in the letter the following items.
➢ Arrangements regarding the planning of the audit.

➢ Expectation of receiving from management written confirmation of representations
made in connection with the audit.
➢ Request for the client to confirm the terms of the engagement by acknowledging receipt
of the engagement letter.
➢ Description of any other letters or reports the auditor expects to issue to the client.
➢ The confidentiality of any reports issued, and, if relevant, the terms under which they
can be shared with third parties.
➢ Basis on which fees are computed and any billing arrangements.
When relevant, the following points could also be made.
➢ Arrangements concerning the involvement of other auditors and experts in some aspects
of the audit.
➢ Arrangements concerning the involvement of internal auditors and other client staff.
➢ Arrangements to be made with the predecessor auditor, if any, in the case of an initial
audit.
➢ Any restriction of the auditor's liability when such possibility exists.
➢ A reference to any further agreements between the auditor and the client.
5.20 Planning
Audit strategy:
The formulation of the general strategy for the audit, which sets the scope, timing and direction
of the audit and guides the development of the audit plan.
Audit plan:
An audit plan is more detailed than the strategy and sets out the nature, timing and extent of
audit procedures (including risk assessment procedures) to be performed by engagement team
members in order to obtain sufficient appropriate audit evidence.
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Audits are planned to:
➢ Ensure appropriate attention is devoted to important areas of the audit.

➢ Identify potential problems and resolve them on a timely basis.
➢ Ensure that the audit is properly organized and managed.
➢ Assign work to engagement team members properly.
➢ Facilitate direction and supervision of engagement team members.
➢ Facilitate review of work.
A structured approach to planning will include:
Ensuring that ethical requirements

continue to be met.
Ensuring the terms of the engagement

are understood.
Establishing the overall audit

strategy.
Developing an audit plan including

risk assessment procedures, audit
tests and any other procedures
necessary to comply with ISAs.
Figure 5.4: - approach to planning
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5.20.1 Understanding the entity and its environment
ISA 315 Identifying and Assessing the Risks of Material Misstatement through Understanding
the Entity and its environment states that ‘the objective of the auditor is to identify and assess
the risk of material misstatement, whether due to fraud or error, at the financial statement and
assertion levels, through understanding the entity and its environment, including the entity’s
internal control, thereby providing a basis for designing implementing responses to the assessed
risks of material misstatement.
Figure 5.5: - The entity and its environment
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5.21 Analytical procedures
Analytical procedures mean evaluation of financial information made by a study of plausible

relationships among both financial and non-financial data. Analytical procedures also
encompass the investigation of identified fluctuations and relationships that are inconsistent
with other relevant information or deviate significantly from predicted amounts.
Analytical procedures are used at all stages of the audit, but here we consider only their use in
planning the audit.
Analytical procedures consist of the analysis of significant ratios and trends including the
resulting investigations of fluctuations and relationships that are inconsistent with other relevant
information or which deviate from predictable amounts.
During planning, analytical procedures should be used as a means of understanding the business
and identifying audit risk.
ISA 520 Analytical Procedures requires auditors to apply analytical procedures as risk
assessment procedures to obtain an understanding of the entity and its environment and in the
overall review at the end of the audit. In addition to the uses of analytical procedures above,
they may also be used as substantive procedures, to obtain audit evidence directly.
5.21.1 Analytical procedures in planning the audit
As we have discussed, analytical procedures should be used at the risk assessment stage.
Possible sources of information about the client include:
➢ Interim financial information

➢ Budgets
➢ Management accounts
➢ Non-financial information
➢ Bank and cash records
➢ VAT returns
➢ Board minutes
➢ Discussions or correspondence with the client at the year-end
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Auditors may also use specific industry information or general knowledge of current industry
conditions to assess the client's performance.
5.22 Materiality
Materiality relates to the level of error that affects the decisions of users of the accounts.
Materiality should be calculated at the planning stages of all audits. The calculation or
estimation of materiality should be based on experience and judgement. Materiality should be
reviewed during the audit.
Figure 5.6: - Audit Materiality
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5.23 Audit Risk
The auditor usually adopts a risk-based approach to auditing and focuses his testing on the
riskiest balances and classes of transactions. Audit risk has two elements, the risk that the
financial statements contain a material misstatement and the risk that the auditors will fail to
detect any material misstatements. Risk of material misstatement in the financial statements has
two elements, inherent and control risk. The risk that the auditor will fail to detect material
misstatements is known as detection risk. Auditors set an acceptable level for overall audit risk
and carry out sufficient tests to ensure this level is met. When the auditor has obtained an
understanding of the entity, he must assess the risks of material misstatement in the financial
statements, also identifying significant risks. Significant risks are complex or unusual
transactions, ie those that may indicate fraud or other special risks.
Figure 5.7: - Audit Risk
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5.23.1 Identifying and assessing the risks
ISA 315 says that 'the auditor should identify and assess the risks of material misstatement at
the financial statement level, and at the assertion level for classes of transactions, account
balances, and disclosures'. It requires the auditor to take the following steps:
Identify risks throughout the process

of obtaining an understanding of the
entity
Relate the risks to what can go wrong

at the assertion level
Consider whether the risks are of a

magnitude that could result in a
material misstatement
Consider the likelihood of the risks

causing a material misstatement
Figure 5.8: - Identifying and assessing the risks
5.23.2 Significant risks
ISA 315 sets out the following factors which indicate that a risk might be a significant risk:
➢ Risk of fraud
➢ Related to recent significant economic, accounting or other development
➢ The complexity of the transaction
➢ It is a significant transaction with a related party
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➢ The degree of subjectivity in the financial information
➢ It is an unusual transaction
Routine, non-complex transactions are less likely to give rise to significant risk than unusual
transactions or matters of director judgement. This is because unusual transactions are likely to
have more:
➢ Management intervention
➢ Manual intervention
➢ Complex accounting principles or calculations
➢ Opportunity for control procedures not to be followed
When the auditor identifies a significant risk, if he hasn't done so already, he must evaluate the
design and implementation of the entity's controls in that area.
5.24 Evidence
Auditors must obtain sufficient, appropriate audit evidence. Evidence can be in the form of tests
of control or substantive procedures. The reliability of audit evidence is influenced by its source
and by its nature. Audit tests are designed to obtain evidence about the financial statement
assertions. Sufficiency is the measure of the quantity of audit evidence. Appropriateness is the
measure of the quality or reliability of the audit evidence.
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5.24.1 Sufficient appropriate audit evidence
ISA 500 Audit Evidence requires auditors to 'obtain sufficient appropriate audit evidence to be
able to draw reasonable conclusions on which to base the audit opinion'. 'Sufficiency' and
'appropriateness' are interrelated and apply to both tests of controls and substantive procedures.
Audit evidence from external sources

is more reliable than that obtained
from the entity's records
Evidence obtained directly by

auditors is more reliable than that
obtained indirectly or
by inference
Evidence obtained from the entity's

records is more reliable when related
control systems operate effectively
Evidence in the form of documents

(paper or electronic) or written
representations are more reliable
than oral representations
Original documents are more

reliable than photocopies, or
facsimiles
Figure 5.9: Quality of Evidence
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5.24.2 Financial Statement assertions
The representations by management, explicit or otherwise, that are embodied in the financial
statements.
ISA 500 states that 'the auditor should use assertions for classes of transactions, account
balances, and presentation and disclosures in sufficient detail to form a basis for the assessment
of risks of material misstatement and the design and performance of further audit procedures'.
It gives examples of assertions in these areas.
5.25 Reporting
Positive or negative assurance can be given. The audit report contains a number of elements
required by law and by ISAs. The audit report gives a high level of assurance, but concerns
remain about the gap between what users think it means and what it actually means. The purpose
of gathering evidence is to be able to express an opinion on the subject matter of the assurance
engagement.
The companies Act 1994 requires the auditors to state explicitly whether in their opinion the
annual accounts give a true and fair view, have been properly prepared in accordance with the
act and have been properly prepared in accordance with the relevant financial reporting
framework such as IFRS as adopted by the ICAB.
According to ISA 700, the audit report should include the following basic elements, usually in
the following layout.
➢ Title
➢ Addressee
➢ Introductory paragraph identifying the financial statements audited
➢ A statement of management's responsibility for the financial statements
➢ A statement of the auditor's responsibility
➢ Scope paragraph, including a description of the work performed by the auditor
42 | P a g e
➢ Opinion paragraph containing an expression of opinion on the financial statements
➢ Date of the report
➢ Auditor's address
➢ Auditor's signature
A measure of uniformity in the form and content of the audit report is desirable because it helps
to promote the reader's understanding and to identify unusual circumstances when they occur.
5.26 Internal Control
ISA 315 Understanding the Entity and its Environment and Assessing the Risks of Material
Misstatement contains the following definition of internal control.
“Internal control is the process designed and effected by those charged with governance,
management, and other personnel to provide reasonable assurance about the achievement of
the entity’s objectives with regard to reliability of financial reporting, effectiveness and
efficiency of operations and compliance with applicable laws and regulations. It follows that
internal control is designed and implemented to address identified business risks that threaten
the achievement of any of these objectives.”
Internal control comprises five components. The control environment is the context of the
internal control system, influenced by management. The risk assessment process is the process
by which the company determines what control policies and procedures to implement. The
information system is the system which captures information about transactions and events for
financial reporting purposes. Control activities are the heart of the internal control system,
comprising policies and procedures which may prevent, or detect and correct errors. All control
systems should be monitored.
ISA 315 sets out that there are five components of internal control, each of which may impact
on the audit process differently. We shall look at each of them in more detail below. An internal
control may fall into a particular category.
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5.27 Documentation
Assurance providers should document the work they have done. This should be a record of the
procedures performed, the evidence obtained and the conclusions reached. This provides
evidence that the engagement was performed in accordance with any relevant standards, law or
regulatory requirements. A record of work done also assists the team to plan and direct work,
facilitates review by senior staff, provides accountability for work, provides a record of matters
that are relevant to future engagements and enables experienced auditors to carry out any
additional reviews necessary.
Audit documentation (working papers) is the record of procedures performed, relevant

evidence obtained and conclusions reached.
5.27.1 Form and content of documentation
Working papers should be headed in a certain way and contain certain information. They may
be automated.
The form and content of working papers are affected by matters such as:
➢ The nature of the audit procedures to be performed

➢ The identified risks of material misstatements
➢ The extent of judgement required in performing the work and evaluating the results
➢ The significance of the audit evidence obtained
➢ The nature and extent of problems or exceptions from expected test results identified
➢ The need to document a conclusion or the basis for a conclusion not readily
determinable from the documentation of the work performed or audit evidence obtained
➢ The audit methodology and tools used
5.27.2 Automated working papers
Automated working paper packages have been developed which can make the documenting of
audit work much easier. Such programs aid preparation of working papers, lead schedules, trial
balance and the financial statements themselves.
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The advantages of automated working papers are as follows.
➢ The risk of errors is reduced.

➢ The working papers will be neater and easier to review.
➢ The time saved will be substantial as adjustments can be made easily to all working
papers, including working papers summarizing the key analytical information.
➢ Standard forms do not have to be carried to audit locations.
➢ Audit working papers can be emailed or faxed for review.
These days most documents can be scanned and stored electronically rather than in paper form.
5.27.3 Filing working papers
For recurring audits, working papers may be split between permanent and current audit files,
although this distinction is fading as audit files become automated, and 'permanent' documents
can be scanned and carried in computer files year on year.
Permanent audit files (contain any information of continuing importance to the audit). These
may contain:
➢ Engagement letters
➢ New client questionnaire
➢ The memorandum and articles of association
➢ Other legal documents such as prospectuses, leases, sales agreements
➢ Details of the history of the client's business
➢ Board minutes of continuing relevance
➢ Previous years' signed accounts, analytical procedures and management letters
➢ Accounting systems notes, previous years' control questionnaires
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Current audit files (contain any information of relevance to the current year's audit). They
compiled on a timely basis after the completion of the audit and should contain (amongst other
things):
➢ Financial statements
➢ Accounts checklists
➢ Management accounts details
➢ Reconciliations of management accounts and financial statements
➢ A summary of unadjusted errors
➢ Report to partner including details of significant events and errors
➢ Review notes
➢ Audit planning memorandum
➢ Time budgets and summaries
➢ Letter of representation
➢ Management letter
➢ Notes of board minutes
➢ Communications with third parties such as experts or other auditors
They also contain working papers covering each audit area.
➢ A lead schedule including details of the figures to be included in the accounts

➢ Problems encountered and conclusions drawn
➢ Audit plans
➢ Risk assessments
➢ Sampling plans
➢ Analytical procedures
➢ Details of tests of detail and tests of control
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Chapter – Six
Findings of the Study
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6.0 Findings
➢ In cash incentive department of any audit firm of Bangladesh can’t provide certificate
and requisition seven working after audit firm received Cash incentive file. One of the
reasons of this is that audit firm received lot of fills. M.J. Abedin & Co. last one year
received more then 600+ cash incentive file.
➢ Audit firm don’t deal only one bank. In M.J. Abedin & Co. deal 5 bank’s cash incentive.
On the other hand, client all the time nock for finish his/her work. Cash incentive and
audit are very longly process.
➢ In an audit firm maximum are CA student so most junior students are work at cash
incentive department and most of them are zero working experience.
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Chapter – Seven
Conclusion &
Recommendations
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7.0 Conclusion
Internship is a bridge between theoretical knowledge and practical knowledge. In review this
internship has been an excellent and rewarding experience. I have been able to meet and
network with so many people that I am sure will be able to help me with opportunities in the
future. As an internee of M.J. Abedin & Co., I have truly enjoyed my internship. I am confident
that this three-month internship at Masih Muhith Haque & Co will definitely help me to realize
my career in the job market. I did an internship at A M.J. Abedin & Co. I have learned a lot for
a period of three months and this period is a small period of time. I apply my expertise here and
get my knowledge from a professional experience. I am learning how to use organizational
theoretical knowledge. I am improving my communication skills. It’s improving my decision-
making power. Now I have a deicidal power over the future. M.J. Abedin & Co. providing the
employee with a very friendly environment. Any intern has a great opportunity to learn new
things.
7.1 Recommendations
➢ Auditors and also audit firm have to face difficulties if fail to issue an appropriate and
adequate audit opinion. When the client faces some legal problems, then the audit firm
is also considered as responsible for it. Auditors must avoid the influence of the client
and must ensure independence in mental attitude while issuing an audit opinion.
Partners of our firm must be strict in issuing an appropriate audit opinion and audit
report.
➢ Senior Students need trained new student more and more. If needed they should arrange
exam every 15 days and measure what his/her performance.
➢ In cash incentive department student’s working performance will be increase more and
more if firm provide more spaces and technical support
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Bibliography
&
Appendix
i|Page
References
1. M.J. Abedin & Co. Profile.

2. M.J. Abedin & Co.
https://www.mjabedin.com/services/
3. Auditing – Banglapedia
(2018, June 18) Retrieved from
https://en.banglapedia.org/index.php/Auditing
4. Alvin A. Arens, Randal J. Elder, Mark S. Beasley - Auditing and Assurance Services-
Pearson (2013), Page 141-142.
5.Huda, Shamsul. (2018, 18 March). BD gets developing nation status. The Daily Observer.
Retrieved from: http://observerbd.com/details.php?id=127995.
6. Audit Practice Manual, from
“Institute of Chartered Accountants Bangladesh”.
7. International Auditing Standards (IAS), (300,330)
8. IFAC. (2009). International Standard on Auditing 610. Control, 142–154. Retrieved from
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Md. Abdullah Al Muttaki - Id 201911152055 - Internship Report

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Internship Report on

“Cash Incentive & Audit Performance of M.J. Abedin & Co.

Subject: - Submission of Internship Report on “Cash Incentive & Audit Performance of

I am here by submitting my Internship Report, which is a part of BBA program curriculum. It

Md. Abdullah Al Muttaki

Harun Mahmud FCA

This is to certify that; Md. Abdullah Al Muttaki is a student of Bachelor of Business

He is permitted to submit the Internship Report.

Engr. M.A. Ghulam Dastagir

Md. Abdullah Al Muttaki

Chapter One Introduction

Chapter Two Review of Literatures

Chapter Three Methodology of the Study

Chapter Fore an Overview of the Organization

Chapter Five Discussion Analysis and Interpretation of the Result

Chapter Six Findings of the Study

Chapter Seven Conclusion & Recommendations

Bibliography & Appendix

1) Large Corporate Firms

1.1 Objectives of the Report

1.2 Rationale of the study

1.3 Scope of the Report

1.4 Limitations of the Report

➢ Competent, Independent Person

3.1 Data Collection Procedures

Primary Source Secondary Source

Figure 3.1: - Data Collection Procedures

3.2 Study Area

3.3 Sampling Procedures

4.1 Current Structure & Strength

1. ATM Kamal Uddin Ahmed

4.3 Number of students: -

4.4 Number of Employee: -

Their Firm ensures Quality, Confidentiality, Integrity and On-time execution.

4.6 Vision of MJA: -

4.7 Services of MJA: -

They Provide the Following Services to their Clients: -

4.8 Their approach: -

4.9 M.J. Abedin & Co. Commitment to Quality

They focus on quality through:

5.0 What is Cash Incentive: -

Bangladesh government provides three options to the final exporter:

The main reasons for providing cash incentive facilities are: -

➢ To increase total export of the country.

➢ To increase foreign remittance and to increase the foreign currency reserve.

5.3 Cash Incentive Background of M.J. Abedin & Co.

5.4 Engagement of Procedure: -

Claim cash incentive

Bank receive incentive file

firm receive claim

Send certificate to Bank cash

Figure 5.1: Flowchart of Cash Incentive Process

5.7 Government Control in Cash Incentive Process: -

5.8 Limitation of Cash Incentive procedure: -

Audit Procedure & Performance of M.J. Abedin & Co.

5.10 General Definition of Assurance

International Federation of Accountants (IFAC) define assurance engagement as: -

“An assurance engagement is one in which a practitioner expresses a conclusion