Statutory Audit Check List




  • Check whether the opening balances are properly carried forward from the previous year
  • This can be done by comparing the PY financial statements and the CY opening Trial balance
  • Verify the cash vouchers along with all supportings
  • Conduct surprise physical cash verification
  • Obtain certificate for cash balance as at the year end from the management
  • Verify the bank payment vouchers along with all supportings
  • Obtain Bank Statements for all the banks
  • Verify the Bank reconciliation statements of all banks and confirm whether al balances are matching
  • Verify whether there are any Stale cheques as at year end & subsequent accounting adjustments thereof
  • Obtain Direct balance confirmation from banks.
  • Check the Purchase Register for the period covered.
  • Verify invoices of suppliers and confirm they are accounted properly
  • Obtain certificate for confirmation of closing balance as at the year end from the management
  • Obtain direct confirmation of stock lying with the 3rd Party
  • Verify whether the sales vouchers issued to customers are properly accounted
  • Check whether sales reflecting in the books reconciles with the VAT records
  • Verify the details in respect of sales return during the period
  • Verify the details of Scrap Sales along with TCS withheld thereon
  • Confirm whether discount and rebate given to various customers are backed by proper authorization documents
  • Verify the details of Free Samples issued during the year, if any
  • Obtain details of item-wise additions & deletions made during the period.
  • Whether any physical veri cation has been conducted by the management & the same has been adjusted in the accounts
  • Ensure that only capital expenditure are capitalized into the books during the period
  • Verify CWIP ledger including advances made during the period, movements in CWIP
  • Ensure that the depreciation method is according to relevant laws
  • Ensure that depreciation on additons are charged on the basis of number of days the assets are used during the year
  • Check whether exchange fluctuation on import of machinery are properly accounted as per AS-11s
  • Check whether AS-10 has been duly complied with
  • Prepare Ageing schedule as at the year end as well as subsequent clearances, if any
  • Obtain Balance confirmations from all the parties
  • Ensure whether re-statement of foreign trade payables is done as per AS-11
  • Verify the details of Credit notes raised during the period
  • Prepare Ageing schedule as at the year end as well as subsequent clearances, if any
  • Obtain Balance confirmations from all the parties
  • Ensure whether re-statement of foreign trade receivables is done as per AS-11
  • Verify the details of Debit notes raised during the period
  • Check whether any provision is to be made on trade receivables as at the year end to cover bad debts
  • Check whether loan instalments are paid in accordance with the loan schedules provided and agreed with the bank
  • Ensure that Interest entries are properly passed during the year
  • Obtain Direct confirmations of all the loans outstanding as at the year end
  • Check the movements in the security deposits along with the agreements executed
  • Verify the details of advances given to the employees and their repayment terms
  • Obtain confirmations for loans given, as outstanding in the books as at the year end
  • Obtain details of related party transactions made during the period along with their respective outstanding balances for reporting purposes
  • Check whether interest income on all FD's are accounted properly
  • Ensure accrued interest is booked in case of income not received during the CY
  • Ensure all TDS receivable entries are passed that reflect in FORM-26AS
  • List down all the statutory laws applicable to the entity Eg: Service tax, Excise duty, VAT/CST, TDS, etc
  • Verify monthly details of statutory dues along with their challans & returns
  • Ensure that all the amounts disclosed in the returns match with that of the books of accounts
  • Check the status of litigations pending under all the acts relating to the entity and report accordingly
  • Review the payroll expenses and check whether it is accounted properly
  • Ensure that statutory deductions have been made for PF, ESI etc. and the Company has also contributed its share for such dues and deposited with appropriate authorities in time
  • Ensure that employer's contribution is booked as expense on account of contribution to PF, ESI & such other funds
  • Ensure that provisions for bonus have been made in accordance with the provision of the payment of Bonus Act, if any.
  • Ensure that gratuity liability has been provided on the basis of actuarial valuation or per company’s policy.
  • Ensure that adequate records for sale and disposal of realizable scrap are being maintained.
  • Ensure that only the insurance claims accepted by the insurance companies are accounted for.
  • Whether profit/loss on sale of assets have been properly accounted for
  • Carry out scrutiny of all the ledgers to ensure that accounting is done properly
  • Segregate prepaid portion for the expenses which relate to subsequent years also
  • Check whether provision is made for all outstanding expenses that relate to CY
  • Ensure whether revenue and capital expenditure are segregated and accounted properly
  • Veriy whether the interbranch balances are matching.
  • Verify compliance with Sec-40A(3)- Cash payments exceeding 20000
  • Verify compliance with Sec-269SS and 269T- Cash loan given/ repaid exceeding 20000 during the year
  • Verify compliance with Sec-2(22e)- Deemed dividend
  • Verify compliance with Sec 43B- Deduction allowed only on actual payment
  • Verify compliance with Sec 40a(i) & 40a(ia)- Provision relating to TDS deduction and payment
  • Verify whether any advance tax has been paid by the entity and if so, consider the same
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