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cash audit basic taxable norms?

sandeep chaudhari (Service) (45 Points)

27 December 2008

Pls help me the Cash audit points as per tax norms

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3 Replies

Binod Prasad (Student CA Final ) (44 Points)
Replied 27 December 2008

First of all see that any payment of expenses which are suppose to be debited to P/L A/c. should not be more than Rs. 20,000 at once. Further see that all the cash payments should be authorised by the concerned authorised signatory. These are towards Expenses side. So far as income side always see that all the payments received should be entered inthe cash book.

CA. Rajeev Aggarwal (Chartered Accountant) (3419 Points)
Replied 27 December 2008

As a good business practice, any company should deal all its transactions through bank only.

Very limited transactions should be done through cash.

Hence all cash voucher must be supported by a valid reason.

And yes there should not be payment of more than Rs.20000

CA. Abhishek Bansal (Research Analyst) (64 Points)
Replied 30 December 2008

Please also ensure that cash balance in the books tallies with physical cash-in-hand and also that books do not show negative cash balance at any given day.