Home › CA Final › auditing › Standards on Auditing and Professional Ethics › Investigation / Due Diligence (DD) versus audit …
Investigation / Due Diligence (DD) versus audit - the KEY difference is:
ADD is shorter
BDD is OBJECTIVE-DRIVEN (e.g. M&A target valuation, fraud), often forward-looking, with bespoke scope; audit is FRAMEWORK-DRIVEN (SAs) on historical FS
CDD costs more
DDD requires no expertise
Answer & Solution
Correct answer: C. DD costs more
1. DD/investigation has a bespoke objective and tailored scope.
2. Audit follows SAs, with reasonable assurance over historical FS.
3. Cost, duration, expertise vary case-by-case.
_Source: ICAI BoS CA Final Paper 3, Ch 6 "Standards on Auditing and Professional Ethics"_
Related questions
Forensic audit, distinct from statutory audit, is:Emphasis of Matter (EoM) paragraph under SA 706 is used when:In the auditor's report, the section on Auditor's Responsibilities should describe:SQC 1 (Standard on Quality Control 1) at FIRM level requires:SA 540 (Revised) for accounting estimates requires:SA 600 (Revised) for group audits emphasises:Auditor's independence under Section 144 of Companies Act 2013 - the auditor of a companA "qualified opinion" under SA 705 is issued when: