31 July 2010
I am enjoying cash credit faclity of Rs. 1 lakh for my partnership firm with business turnover of Rs. 20 lakhs involved in retail trade. Recently my bank asked for audited financial statements of my firm stating that now as per RBI circular any customer whose turnover is more than Rs. 10lakh and is avialing any advances from bank needs to get accounts audited.
Where as per Income tax act My firm is not required for audit as turnover is juts Rs. 20 lakhs? Can anyone confirm the has RBI issued circular to thath effect?
Audit under any statute and Audit and Income tax is different.
Audit as per the Income Tax Act is audit as per 44AB which is normally referred to as Tax Audit.
but normal audit is to express an opinion on the financial statements (balance sheet, profit and loss account, cash flow statement, notes to accounts.)
to the best of my knowledge audit as referred in RBI's instruction is not audit under 44AB of the Income Tax Act, is an audit of the financial statements.
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