What is an Audit
Audit is an independent examination of financial statements which includes Balance sheet, Profit and loss account, Cash flow statement and other notes forming parts of the earlier statements.
Auditor is a person who conducts the Audit of an entity and expresses his opinion based on examination of these financial statements.
Following are the types of financial audit and its applicability as per various statues/laws.
| Sr No | Name of the statue/law | Name of the audit | Applicability |
| 1 | Companies Act, 2013 | Statutory Audit | Audit under Companies Act is applicable to all Companies whether private limited, public limited, one-person company or section 25 Company. Irrespective of turnover, the audit is mandatory as per Section 139 of the Companies Act, 2013. |
| 2 | Income tax Act, 1961 | Tax Audit | Section 44AB of the Income tax act, 1961 mandates audit of books accounts of the taxpayers by a Chartered Accountants. Turnover limit for Tax audit is Rs 1 Crore which by virtue of other sections of Income tax act and compliance with those sections may go upto Rs. 2 Crores and 5 Crores. |
| 3 | Limited Liability Partnership Act, 2008 (LLP) | Statutory Audit under LLP Act | Limited Liability partnerships having turnover of Rs 40 lacs or more in a financial year are required to get there accounts audited from a chartered accountant. |
Why to get your accounts audited?
In today’s world, a Company’s and Businesses are valued, trusted, and recognized based on its financial statements. The Financial statements is the mirror of Company’s profitability, stability, growth, and financial health. So, as a business owner you should have accurate, error free, transparent, clean, trustworthy, and certified mirror i.e. Financial statements.
Every goods and service needs to be certified by eligible authorities to get value to it and to get trustworthiness to it. Like gold jewelry have Hallmarking, electrical appliances have energy efficiency certification. The Financial statements get its trustworthiness and value with an Independent Auditor’s report issued with Financial statements by Chartered Accountants (CA). In common parlance, CA’s signature can give value to your financial statements.
Benefit of getting your audited can be summarized as below: –
- Identification of errors and misstatements in the financial statements.
- Accuracy of Company’s assets, liabilities, profits, losses, and net worth
- Trustworthiness of the statements to external stakeholders like Banks, Financial institutions, Investors, and shareholders.
- Better compliance with Companies Act and any other statue requiring books to be examined by independent auditor
- Compliance with applicable provisions of Income tax act like Tax Deduction at Source, payments of statutory dues, valuation of stock, filing of TDS returns, payments to related parties and reporting on the same etc.
How Avenir Advisor can assist you in Audit and Advisory
- Selection of Auditor
We, at Avenir Business Advisor Private Limited has networked with various Chartered Accountant firms having followed
- highest ethical practices,
- focuses on compliance with various laws applicable to the Company and
- independent in giving opinion on the financial statements
- compliance with Accounting and Auditing standards issued by Ministry of Corporate affairs and Institute of Chartered Accountants of India (ICAI)
Firms having these characteristics can audit your books of accounts which provides detailed opinion on the accuracy, completeness, existence, valuation, obligation and presentation of the financial statements.
- Assist in getting accounts audited
Further, our team consists of financial experts who can help you in
- Preparation of Financial statements to be given to Auditor for his examination
- Help you, the business owner, to learn and understand the financial statements and its effective utilization while presenting the same with external stakeholders
- Advisory on the cash flows of the Company and its effective utilization
- Advisory on the increase in the profitability of the business looking at the financial transactions and statements.
- Preparation of Projections for future years for borrowings or investment etc.
So, if you are planning to get your accounts audited or if under the provisions of any law you are required to get your account audited, don’t forget to contact AVENIR BUSINESS ADVISORS. We are there to help you, we are there to guide you.
We are AVENIR ADVISORS, we provide Ideas, that lies ahead!!