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K RAO
M.Com,LLB.,FCMA,MIMA,FCS
Building and Other Construction Workers Act,1996
- Applicable if 10 or more construction workers, or
Construction cost exceeds 10 lakhs (Excluding land cost)
Control Environment
Risk Assessment
Control Activities
Monitoring
K.K.RAO & ASSOCIATES
Risk Assessment is a process by which an auditor Identifies and
evaluates the Quantity of the Organization risk and Quality of its
controls over those risks
Organizational alignment
Maintaining reasonableness of
internal financial controls
Rental income.
Schedule adjustments.
Natural Calamities
Common Expenses
Or a combination of above.
Conditions to Apply
Total project revenue can be estimated reliably.
The probable economic benefits associated with the project will flow to the
enterprises.
The cost to complete the project and cost up to stage of completion at the
reporting date can be estimated reliably.
The project cost attributable to the project can be identified and measured
reliably for the purpose of comparison with prior estimates.
All the approvals required for commencement of the project activity have
been obtained.
EPC Model :
EPC model is Engineering, Procurement and Construction
Contracts finalized based on Technical and Commercial bidding
process. It covers
i) LSTK‐ Lump Sum Turnkey contracts
ii) Cost plus contracts
iii) Item Rate Contract
iv) A Combination of above
K.K.RAO & ASSOCIATES
POTENTIAL CAUSES OF INEFFICIENCIES :
Poor quality of planning and engineering design
Internal controls
Customer satisfaction
Technological changes
Environmental changes
Political changes
Political contributions
Disaster management
Detection of fraud
Diversion of funds
Insurance
Legal cases