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Yes, a statutory audit is mandatory for every Private Limited Company and Public Limited Company under the Companies Act, 2013 — regardless of turnover or profit. For LLPs, it is mandatory if annual turnover exceeds ₹40 lakh or capital contribution exceeds ₹25 lakh. There is no turnover exemption for companies — even a company with zero revenue must have its accounts audited annually.

A statutory audit is conducted under the Companies Act, 2013 to verify that financial statements present a true and fair view of the company's financial position. A tax audit is conducted under Section 44AB of the Income Tax Act to verify that taxable income has been correctly computed. Both may apply to the same company — a company above the threshold must have both, filed under different laws with different report formats.

We typically require: books of account (software access), bank statements for all accounts, all invoices (sales and purchases), fixed asset register, loan documentation, TDS returns, GST returns, payroll records, and board and shareholder meeting minutes. We provide a detailed checklist specific to your company at the start of the engagement.

For a small to mid-sized Private Limited Company, a statutory audit typically takes 2–4 weeks from the date all documents are provided. The timeline depends on transaction volume, completeness of records, and entity complexity.

A management letter highlights weaknesses in internal controls, accounting errors, or process gaps observed during the audit — that are not material enough to affect the audit opinion but are important for management to address. We issue a management letter alongside every statutory audit as a standard practice, providing actionable recommendations beyond the compliance sign-off.

The statutory audit must be completed before the AGM, which must be held within 6 months of the financial year-end — by September 30 for companies with a March 31 year-end. Financial statements must then be filed with the ROC within 60 days (Form AOC-4). The tax audit report (if applicable) must be filed by October 31. We calendar all these dates at the start of the engagement.

Under the Companies Act and ICAI guidelines, a CA who maintains books cannot act as the statutory auditor, as it impairs independence. If we maintain your books, we refer you to an independent auditor for the statutory audit. We continue to support the process — preparing schedules, responding to queries, and providing documents — while the independent auditor signs the report.

An internal audit is an independent examination of a company's processes, controls, and financial records — conducted more frequently than a statutory audit and focused on operational efficiency and risk management. Under the Companies Act, it is mandatory for certain companies (listed companies and unlisted companies above prescribed turnover and borrowing thresholds). For companies below the threshold, an internal audit is a strong governance tool.

Discrepancies found during audit — misclassified entries, unsupported transactions, missed tax liabilities — are flagged and discussed with management. Minor errors are corrected in the books before the audit report is signed. Material issues are disclosed in the audit report with appropriate qualifications. We communicate all findings clearly and help resolve them before the report is finalised.

Under Section 147 of the Companies Act, a company that fails to comply with statutory audit requirements faces a fine of ₹25,000 to ₹5 lakh. Every officer in default — typically the directors — is also personally liable. The ROC may additionally strike off the company for non-filing of financial statements. The consequences are material; there is no valid reason to delay a statutory audit.

We work professionally with group auditors — whether a Big Four firm or a mid-tier practice — and follow their component audit instructions for group reporting. We prepare reporting packages, answer their queries, and ensure our work is consistent with the group's accounting policies and audit requirements. Clear, timely coordination with group auditors is part of how we manage the engagement.

We can assist with financial due diligence — a structured review of a target company's historical financials, key contracts, and financial risks, prepared for a potential investor or acquirer. This is distinct from a statutory audit and draws on the same analytical skills. We prepare a financial due diligence report identifying material findings, adjustments to reported EBITDA, and key risks for the investor.