Proper Books and Accounts
s. 121(1) of Companies Ordinance (Cap. 32) provides that each company has a duty to keep proper books and accounts. The accounts must give a true and fair view on the financial position of the company and it can reflect all transactions.
Before issuing auditors’ report, the auditor must audit the company’s books and records or transaction records, based on which they form an audit opinion. If they are of the view that the company has not keep the books and records or transaction records properly, they have to express a qualified opinion in its audit report.
Directors has to take reasonable step to ensure the books and records or transaction records are properly kept so that all matters are true and fairly reflected and formed the explanation base of all transaction.