Regarding qualifying audit report
This query is : Open
23 May 2015
I seek your guidance in the following matter :
Para 1 of the Companies ( Auditors Report ) order 2015 excludes a Pvt. Ltd. Co. if its share capital & reserves are less than Rs. 50 Lakhs , has not taken a loan exceeding Rs. 25 Lakhs from Bank & does not have turnover more than Rs. 5 Crores .
I have a Pvt. Ltd. Company which fulfills all these conditions & hence excluded from the Report Rules .
However , the same Company has :
(a) Defaulted in payment of Service Tax & other statutory dues for more than 6 Months ,
(b) Accumulated loss which wiped out its Reserves & Surplus completely , & (c) Has incurred Cash loss in 2014-15 & 2013-14 .
In these circumstances , should I qualify my Report or Not ?
Please do enlighten me on the above matter
Para 1 of the Companies ( Auditors Report ) order 2015 excludes a Pvt. Ltd. Co. if its share capital & reserves are less than Rs. 50 Lakhs , has not taken a loan exceeding Rs. 25 Lakhs from Bank & does not have turnover more than Rs. 5 Crores .
I have a Pvt. Ltd. Company which fulfills all these conditions & hence excluded from the Report Rules .
However , the same Company has :
(a) Defaulted in payment of Service Tax & other statutory dues for more than 6 Months ,
(b) Accumulated loss which wiped out its Reserves & Surplus completely , & (c) Has incurred Cash loss in 2014-15 & 2013-14 .
In these circumstances , should I qualify my Report or Not ?
Please do enlighten me on the above matter
24 May 2015
Default of the statutory dues may be specified in the 'notes on accounts' and a passing reference may be made in the audit report. Need not qualify the report.
In the matter of accumulated loss and cash loss, specific mention has to be made in the notes as well as in the 'audit report' and how it affects the 'going concern concept' has also to be mentioned necessarily in the audit report.
Default of the statutory dues may be specified in the 'notes on accounts' and a passing reference may be made in the audit report. Need not qualify the report.
In the matter of accumulated loss and cash loss, specific mention has to be made in the notes as well as in the 'audit report' and how it affects the 'going concern concept' has also to be mentioned necessarily in the audit report.
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