16 October 2008
A private company has no business activity during the entire year ending 31-03-2008 and it proposes to file a petition for winding up u/s 560 of the Companies act, 1956. As such, it has no profit & loss account for the year. In balance sheet, liability side is represented by paid up share capital and in the asset side, there is an equal amount of profit & loss account balance (Loss). there are no other liabilities or assets. As an auditor of the company, how to draft the audit report? Whether reporting is still to be done covering all aspects referred in section 227(2) and 227(3). Is there any guidance available in the literatures published by ICAI. If so, please furnis the same.
16 October 2008
As long as the company is not under liquidation, the provisions of section 227(2) and (3) are applicable not withstanding there was no transaction for the entire period and the sharecapital is fully written off.
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