The proprietor has last filed return and tax audit report in FY 2011-12 and thereafter has not filed any details. In FY 2014-15, the proprietor wants to conduct tax audit then in such case which opening balances need to be taken and what needs to be reported under tax audit report by Auditor?
6 Replies
Rashi Bajaj
(CA)
(752 Points)
Replied 04 September 2015
Opening balance as on 1-4-2014 has to be taken only. Although no return have been filed between FY 2011-12 till date, I am assuming, books of accounts were atleast maintained.
Besides, do check applicability of tax audit u/s 44AB. If applicable, the report clearly mentions the areas to be looked into.
Sunny
(CA Business)
(401 Points)
Replied 04 September 2015
Appreciate your prompt reply.
The proprietor has not maintained any accounts post 2011-12. So I believe whether comments/ qualifications regarding the same if given in the report would suffice??
Rashi Bajaj
(CA)
(752 Points)
Replied 04 September 2015
The criteria for maintaining books has to be complied with first.
Check if turnover is >10 lakhs.
If yes, then maintain books and check if it exceeds 1 cr.
Sunny
(CA Business)
(401 Points)
Replied 04 September 2015
Books have been maintained in 2011-12. Thereafter directly in 2014-15 and turnover crosses 1 cr mark.
Rashi Bajaj
(CA)
(752 Points)
Replied 05 September 2015
Are you saying, there was no requirement to maintain books in the interim periods? That's not possible coz you already have done audit in 2011-12. that means, for FY 2012-13, 2013-14 and 2014-15 you were required to maintain books. Seems like you defaulted.
Better start gatheing whatever info you can about earlier years and atleast make a draft books of accounts for the interim periods.
Then you may take opening balance as per those books.
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