Tax audit

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

07 September 2012 Dear Sir,

Can Indian Chartered Accountant do Tax Audit of Irish man ( Ireland ). And if Yes, then Balance sheet of him should be made in Euro or in Indian currency ? Can Indian Chartered Accountant can sign the Balance sheet in Euro ?

Its Very URGENT.....!!!!

Nayan Das

Nayan Das (Expert)
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07 September 2012 IF HE BUSINESS AT INDIA THEN HE SHOULD BE SIGNED. OTHER WISE IRELAND GOVT. RULES WISE EFFECTED

Querist : Anonymous

Querist : Anonymous (Querist)

07 September 2012 His bank accuont transaction is in Euro... Expences made in Euro.. Receipts made in Cash... Now, What to do?????

Asha Kanta Sharma online

Asha Kanta Sharma online

(Expert)
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26 July 2025 Here’s a clear response to your urgent query:

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### Can an Indian Chartered Accountant (CA) do Tax Audit for an Irish Individual?

* **If the Irish individual has business operations or taxable presence in India**, then yes, an Indian CA **can perform the tax audit for the Indian tax purposes** under Indian laws.
* Tax audit under **Section 44AB** of the Income Tax Act applies only if the person has taxable business or profession in India.

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### Regarding the Balance Sheet currency and signing:

* The **financial statements for Indian tax purposes should be prepared in Indian Rupees (INR)** as per Indian Accounting Standards and tax laws.
* The Indian CA **cannot sign the Balance Sheet in Euro** for Indian tax audit purposes.
* The foreign currency transactions should be **converted into INR** using appropriate RBI/Income Tax notified exchange rates as on the relevant date (e.g., date of transaction or financial year-end).

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### How to handle transactions in Euro and cash receipts:

* All foreign currency transactions (receipts and expenses) must be **recorded in INR by converting the amounts at the prescribed exchange rate**.
* Cash receipts should also be converted into INR on the date of receipt.
* Maintain proper documentation and conversion details for audit and tax compliance.

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### Summary:

| Question | Answer |
| -------------------------------------------- | ---------------------------------------------- |
| Can Indian CA do audit for Irish individual? | Yes, if he has business presence in India |
| Balance Sheet currency | Prepare and sign in Indian Rupees (INR) |
| Can balance sheet be signed in Euro? | No, must be in INR |
| How to handle Euro transactions | Convert all to INR at prescribed exchange rate |

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If you need, I can guide you on the exchange rate methods or provide a sample of journal entries for foreign currency conversion. Just let me know!

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