AUDITING

What is Auditing?

Auditing is the process of examining financial records, transactions, and statements of an entity to ensure accuracy, compliance with laws, and fair representation of financial health. It helps in detecting fraud, errors, and misstatements.

Audit Limits for Different Persons

1. Company Audit (Statutory Audit)

   Mandatory for all companies, irrespective of turnover.

2. Tax Audit (Under Income Tax Act, Section 44AB)

Businesses: If turnover exceeds ₹1 crore (Limit increased to ₹10 crore if cash transactions are ≤5%)
1. Professionals: If gross receipts exceed ₹50 lakh.

3. GST Audit

Mandatory if turnover exceeds ₹5 crore in a financial year.

4. Audit for Individuals, HUFs, and Firms

Not required unless covered under the above limits.