Statutory audit in Indiafor UK-owned companies.
Every company registered in India must have its annual accounts audited by a Chartered Accountant. We carry out the statutory audit of Indian subsidiaries, branches and LLPs owned from the UK, file the results with the Registrar of Companies, and give your UK finance team and group auditors what they need for consolidation.
What a statutory audit in India is.
A statutory audit is the independent audit of a company's financial statements that Indian law requires every year. Under the Companies Act, 2013, the company's appointed auditor, who must be a Chartered Accountant in practice or a firm of Chartered Accountants, examines the books and reports to the shareholders on whether the balance sheet, profit and loss account and cash flow statement give a true and fair view and follow the applicable accounting standards.
The auditor's report under Section 143 is attached to the financial statements, adopted at the annual general meeting and then filed with the Registrar of Companies. Banks, the income tax department, the Reserve Bank of India and future investors all rely on these audited accounts, so the audit is the foundation for almost every other company compliance task in India.
Unlike the UK, where small companies can often claim audit exemption, every company registered in India needs a statutory audit, even with no turnover in its first year.
Who needs a statutory audit in India.
The structure your UK business uses in India decides which audit and filings apply. These are the set-ups we audit most often for UK groups and founders.
Indian subsidiary of a UK company
A private limited company owned by a UK parent needs a full statutory audit every year. As a subsidiary, it can't claim the lighter "small company" rules.
Public and Section 8 companies
Public limited companies and not-for-profit Section 8 companies need an audit too, often with wider reporting.
Limited liability partnerships
An LLP needs an audit once its turnover exceeds ₹40 lakh or partners' contribution exceeds ₹25 lakh in a year.
Branch or project office of a UK company
A branch office files audited accounts of its Indian business with the ROC each year, alongside its tax return in India.
Liaison office
A liaison office needs audited accounts and an Annual Activity Certificate from a Chartered Accountant, sent to its bank and the RBI.
One Person Companies
A One Person Company, often used by founders living in the UK, still needs an annual statutory audit.
Why the Indian audit matters to a UK parent.
For a UK group, the Indian statutory audit is more than a local filing. The figures flow into your group accounts, your transfer pricing position and your foreign investment reporting to the RBI.
Your UK auditors need audited Indian figures and a reporting pack. We help bridge Indian GAAP or Ind AS to IFRS or FRS 102 where you need it.
Indian companies use a 1 April to 31 March year. A subsidiary that must align with a foreign parent can apply to the Tribunal for a different year.
Charges between the UK parent and Indian subsidiary need arm's length support. See international transfer pricing.
Audited figures feed the annual FLA return due to the RBI by 15 July, and other FDI filings.
Dividends to the UK parent can only be paid from profits shown in audited accounts.
Directors, including those living in the UK, can be disqualified if accounts aren't filed for three years in a row.
What our statutory audit covers.
We plan each audit around your business and the reporting your UK group needs. A typical statutory audit of an Indian subsidiary includes the following.
- Financial statementsBalance sheet, profit and loss, cash flow and notes under Schedule III.
- Accounting standardsCompliance with Indian Accounting Standards or Ind AS where it applies.
- CARO 2020 reportingThe Companies (Auditor's Report) Order, where the company falls within it.
- Internal financial controlsReporting on controls over financial reporting where required.
- Related party transactionsIntercompany charges, loans and recharges with the UK parent.
- Audit trail in accounting softwareChecking the edit log required in the company's books.
- Tax and GST reconciliationsTDS, advance tax and GST records matched to the books.
- Fixed assets and inventoryPhysical verification support and stock audit where needed.
Our statutory audit process, step by step.
Everything runs online, so your UK team never needs to travel. You get a written plan before we start and regular updates until the filings are done.
Auditor appointment and ADT-1
The board appoints us as statutory auditor, and the ADT-1 is filed with the ROC within 15 days of the meeting.
Scope, materiality and timetable
We agree the scope, fee, document list and deadlines in writing, including dates your UK group auditors need.
Testing and confirmations
We test transactions, balances and controls, send bank and party confirmations, and review intercompany balances with the UK parent.
Audit report and management letter
We sign the audit report with a UDIN, report under CARO where it applies, and share any control points in a management letter.
AGM, AOC-4 and MGT-7
After the AGM, the AOC-4 and MGT-7 annual return are filed, and we provide the group reporting pack for the UK.
Key dates and forms for a company audit.
For a company with a 31 March year end, these are the standard deadlines under the Companies Act, 2013. Holidays and official extensions can change them.
| Event | Deadline | Form | Section |
|---|---|---|---|
| First auditor appointed by the board | Within 30 days of incorporation | ADT-1 | 139(6) |
| Auditor appointed at the AGM | At the first AGM, for 5 years | ADT-1 within 15 days | 139(1) |
| Annual general meeting | Within 6 months of year end, so by 30 September | Minutes | 96 |
| First AGM of a new company | Within 9 months of the end of its first year | Minutes | 96 |
| Financial statements filed | Within 30 days of the AGM | AOC-4 | 137 |
| Annual return filed | Within 60 days of the AGM | MGT-7 / MGT-7A | 92 |
| Foreign liabilities and assets return | By 15 July each year | FLA to RBI | FEMA |
We also look after annual ROC filings, ADT-3 if an auditor resigns, and auditor rotation for companies that must change auditors after the permitted terms.
Statutory audit vs tax audit vs internal audit.
UK finance teams often ask how these three audits differ. A company can need more than one in the same year.
| Statutory audit | Tax audit | Internal audit | |
|---|---|---|---|
| Required by | Companies Act, 2013 | Income-tax law | Management, and the Act for some companies |
| Who needs it | Every company | Businesses above turnover limits | Larger companies, or by choice |
| Reports to | Shareholders | Income tax department | Board or audit committee |
| Main focus | True and fair accounts | Tax records and disclosures | Controls, risk and processes |
| Learn more | This page | Tax audit | Internal audit |
Documents we need for the audit.
We send a tailored list after the first call. This is what most Indian subsidiaries share, through an encrypted upload link.
- Trial balance and general ledger
- Bank statements and reconciliations
- Fixed asset register
- Previous year's audited accounts
- Board and shareholder minutes
- Statutory registers
- Share allotments and FC-GPR filings
- Intercompany agreements with the UK parent
- TDS returns and challans
- GST returns and input credit workings
- Payroll registers and PF records
- Advance tax and income tax returns
What happens if the audit is late.
Indian company law treats missed audit and filing deadlines seriously. Planning the audit early in the UK group's calendar avoids these problems.
Late AOC-4 and MGT-7 filings attract an additional fee of ₹100 for each day of delay, with no upper limit.
Directors of a company that doesn't file financial statements or annual returns for three years in a row can be disqualified.
Failing to appoint an auditor, hold the AGM or file accounts can lead to penalties on the company and its officers.
We regularly help UK parents bring an Indian subsidiary's overdue audits and ROC filings up to date, including DIN reactivation for directors.
Why UK companies choose us as their Indian auditor.
We work directly with your group audit team on instructions, deadlines and reporting packs.
Every audit file is reviewed by a second accountant before the report is signed.
A written engagement letter with scope, timetable and fee, agreed before any work starts.
Encrypted document sharing and digital signatures. No travel to India for your UK team.
Bookkeeping, GST, TDS and ROC work, coordinated around the audit.
A clear management letter your UK board can act on, without jargon.
Statutory audit for UK companies wherever you are based.
We audit Indian subsidiaries, branches and LLPs for UK parent companies and founders across England, Scotland, Wales and Northern Ireland. The audit is run from India and coordinated with your UK finance team online.
London
South East
Midlands
North of England
East and South West
Scotland, Wales, NI
Statutory audit FAQs.
Need a statutory auditor for your Indian company?
Tell us about your Indian entity, its year end and your UK group's reporting dates. We'll reply with a written scope and fee.
The information on this page is general guidance based on the Companies Act, 2013 and related rules, and is not legal or financial advice for your situation. Deadlines and thresholds can change; please contact us before acting on it.