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Assessing the financial health of any company by the auditor whether it is the company being audited or the borrower on similar lines of a doctor assessing a patient's health is not possible and practicable. Credit rating agencies can only assess the financial health of the company on a given date.

The auditor expresses an opinion in his audit report as per the Companies Act and the guidelines of the Institute.

Only examining the financial accounts cannot assess the financial health of a company.

Total accounting/accountability management is a necessity for improving financial credibility today.

While auditors are professionally educated, the accountants who maintain and prepare the accounts of a company on a day-to-day basis are not subject to any quality standards or assessments.

Ramachandran Mahadevan

Bangalore

Letters to the editor and contributions can be sent by e-mail to: bleditor@thehindu.co.in

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