An audit is a legally required review and reporting of the accuracy of the company's financial records. The purpose of an audit is to determine whether an organization is providing a fair and accurate representation of its financial position by examining information such as bank balances, bookkeeping records and financial transactions.
A LO/BO is required to have its accounts audited by an independent Chartered Accountant as defined under The Companies Act.
In case its turnover for a financial year exceeds INR 6 Million, it is also required to perform and report an independent audit under sec 44 AB of The Income Tax Act.
Subsequent to completion of Audit, the prescribed details / forms are required to be filed with the Income Tax Authorities on an annual basis.
Also the BO is required to ascertain its "taxable income" as per provisions of Income tax act and pay the taxes due thereon.
Filing of returns is mandatory for all companies and any lapses would attract penalty and interest.
A LO/BO in India is required to file its return outlining prescribed details with Registrar of Companies on annual basis.
The same is required to be filed in electronic form and the return is popularly called as ANNUAL RETURN.
Any lapses in filing these returns will make company as "defaulter" and also its directors name can be reflected as "defaulters" under ROC.
As per FEMA Provisions, all LOs/BOs are mandated to file annual return with RBI in prescribed forms.
All Los/BOs are mandated to file an annual return with Police department.
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