There are various forms of audit conducted under various laws such as statutory audit, tax audit, cost audit, stock audit, compliance audit, etc. As per income tax law, it also mandates audit called tax audit, as the name itself suggests, tax auditing is an analysis or evaluation of taxpayers ' records from an income tax point of view in any company or occupation. This makes the income estimation process simpler for filing income returns.
A taxpayer is expected to perform a tax audit if the sales, turnover or gross business receipts in the financial year surpass Rs 1 crore. However, under some other cases, a taxpayer might be forced to have their accounts audited. In the tables listed below, we classified the various circumstances.
NOTE: The threshold for tax audit Rs 1 crore is proposed to be raised to Rs 5 crore with effect from AY 2021-22 (FY 2020-21) if the taxpayer's cash receipts are limited to 5% of gross receipts or turnover and the taxpayer's cash payments are limited to 5% of aggregate payments.
Statutory auditing, also known as financial auditing, is one of the key methods of auditing to be carried out in compliance with the legislation applicable to the entity and its primary objective is to gather all relevant details so that the auditor can provide his opinion on the accurate and fair view of the financial status of the company as on the date of balance sheet.
Single / HUF / Partnership Firm: No Applicable Statutory Review.
LLP: Statutory audit is only valid if the revenue exceeds Rs. 40 Lakhs in any financial year or the contribution exceeds Rs. 25 Lakhs.
Private Limited Company / Public Limited Company: Compulsory irrespective of revenue, income, etc. Loss is incurred also in the company; statutory auditing is required.
For Statutory audit only practicing charted accountants are allowed to carry on the audit process.
This is a mechanism for testing the company's compliances under Corporate Law & other laws, guidelines, regulations, procedures etc. It's a tool for tracking compliance with specified laws and processes requirements. Periodically reviewing the work is important to point out errors and errors and to create a comprehensive framework of enforcement mechanisms in an organization
Only the Company secretary is allowed to conduct this audit.
It is applicable on:
Every business entity must at least perform a stock audit once a year to update and ensure that the physical stock matches the computed stock. A stock audit helps to resolve inconsistencies between the physical stock which can be corrected from the book stock.
Stock audit or inventory audit is a term relating to physical inspection of the products in the inventory of a business or entity. According to the reason, there are forms of stock audits and each stock audit would involve a different approach.
Cost Audit is the mechanism for checking the distribution of costs for each product or service consisting of labor costs, production costs or some other cost element as applicable. Cost Audit is a methodical and accurate account and record check to manage the records in compliance with the Cost Accounting Principles.
A cost accountant is eligible for performing cost audit
The cost audit shall apply in the following situation–Table A listed goods/services–The overall annual total company turnover of all products/services shall be INR 50 Crore or more, and the aggregate turnover of the specific product/service for which cost records are expected to be maintained shall be INR 25 Crore or greater.
Goods/services listed in Table B- Total annual total turnover should be INR 100 Crore or more for all products/services; and aggregate turnover should be INR 35 Crore or more for the individual product/service for which cost records are expected to be maintained.
It must be remembered that the turnover of the financial year immediately preceding is to be considered for the purpose of evaluating the applicability of cost audit.
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Corpzo is a team full of professionals who are qualified and highly experienced and will provide audit performance for your entity as per the applicability. Corpzo will help you to conduct the audit for your organization with the help of our qualified professional and provide you with a measure to control fraud and misconduct if any. We can help you with growth planning as per your audited financial.
Obligatory fees levied on individuals or corporations and enforced by a government entity - whether local, regional or national - in order to finance government activities are called a tax. In economics, taxes fall on whomever pays the burden of the tax,
Involuntary charges levied on individuals or businesses and enforced by a government agency— whether local, regional, or national — to finance government operations are called taxes. In economics, taxes are levied on whoever bears the tax burden, be i
There are various forms of audit conducted under various laws such as statutory audit, tax audit, cost audit, stock audit, compliance audit, etc. As per income tax law, it also mandates audit called tax audit, as the name itself suggests, tax auditing is
TDS know as a Tax deduction at source. This comes under the direct tax, as per the Income Tax Act 1961; Any Company, LLP, Firm or individual should deduct TDS before paying any amount to the payee if payment exceeds a certain threshold limit. Any payment
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