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Eligibility for audit and filing Annual report

Abishek (Student) (1108 Points)

26 February 2011

Is it necessary for a newly formed company without any transactions to go for an audit and file its balance sheet (with only authorised capital )and P/l account duly certified by a CA?

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4 Replies

Vaibhav (Assistant Manager) (28 Points)
Replied 27 November 2012

hi,

am joint newly a service industries, the compny is newly establish in india & for setup , asset purchase etc.. their expenses is almost Rs.2.5 crores & sales as on 31.10.2012 is approx Rs.15 lakhs.. in that case this compny is eligible for audit this year ?

pls guide me..

Nithin Chettoor (Assistant Manager) (388 Points)
Replied 28 November 2012

Yes it is a requirement for every compay incorporated to comply with all the requirements as per companies act, 1956. Hence, every company has to file the annual returns and prepare a financial statement and file the same with ROC within the prescribed time limit.

And every company has to appoint an auditor and the financial statement has to be audited and signed by a CA.

The logic is pretty much this " How to ensure that there is only Authorised capital in the financial statement" and "Who will ensure it?"

Vaibhav (Assistant Manager) (28 Points)
Replied 28 November 2012

hi nithin,

thanks for assist me.. am agree with your statement but i have one query in that , as per company act 1956 audit is required only when company's turnover is exceeds Rs.60 lakhs

in my compnay there is no sufficient turnover to take audit..

Nithin Chettoor (Assistant Manager) (388 Points)
Replied 28 November 2012

There is no such provision in COmpanies Act, 1956 like this. There is no turnover limits specified. Every company should be subject to audit.

The turnover limits you are talking about is in Income tax act for tax audit purposes. But it is not applicable to companies and firms. Its mandatory for all companies to get the books of accounts audited under Companies Act, and Income tax Act.