Fact-check notes
Last fact-checked: 2026-06-04
MCA, ROC, company registration, LLP, audit, accounting and compliance work should be verified against current MCA V3 forms, master data, board records and applicable entity facts.
This page is preparation guidance. Ask the expert to verify active law, portal forms, notifications and your documents before filing, signing or paying.
Key tax audit questions
Tax Audit questions usually become easier once you identify the year, entity type, documents, portal status and deadline. This FAQ helps you prepare a better WorkIndex brief.
- Confirm whether the issue is filing, registration, correction, notice reply, advisory or ongoing compliance.
- Check official portal status before relying on memory or old forms.
- Keep documents and transaction evidence ready before asking for a quote.
- For deadlines, mention exact dates and current status.
Who this is for
- User doing initial research.
- Founder comparing expert scope.
- Taxpayer trying to understand a notice or filing requirement.
- Business owner preparing documents.
Documents and details to prepare
- Entity or taxpayer details.
- Prior filings and portal status.
- Notice, challan or acknowledgement if any.
- Transaction details and deadline.
Common mistakes to avoid
- Asking for a fixed answer without facts.
- Using old thresholds or forms.
- Ignoring portal mismatch.
- Not saving evidence after filing.
How to brief the expert
- Read the FAQ to identify your issue type.
- Collect the records listed here.
- Post the requirement with facts and deadline.
- Ask the expert for a written scope before starting.
FAQs
What is the first thing to check for Tax Audit?
Check the applicable year, entity type, portal status and whether any notice or deadline is involved.
When should I hire an expert?
Hire an expert when money, penalties, registration, notices, audit, foreign income or company-law filings are involved.
Can WorkIndex compare experts?
Yes. Share your facts once and compare relevant professionals by quote and scope.
Frequently Asked Questions
1. What is the primary role of accounting and bookkeeping in relation to Tax Audit FAQ?
Bookkeeping is the systematic recording of daily financial transactions for Tax Audit FAQ. Accounting involves summarizing, analyzing, interpreting, and reporting these transactions to prepare financial statements and tax filings.
2. What is a Statutory Audit, and does it apply to Tax Audit FAQ?
A statutory audit is an official review of a company's financial records to verify they present a true and fair view. Under the Companies Act, 2013, a statutory audit is mandatory for all incorporated companies (Private Limited, Public, OPC) carrying out activities like Tax Audit FAQ, regardless of turnover or capital.
3. What is a Tax Audit under Section 44AB, and how does it relate to Tax Audit FAQ?
A tax audit is a review of books of accounts to ensure tax compliance under Section 44AB. It is mandatory if a business's annual turnover exceeds ₹1 crore (or ₹10 crore if 95% of receipts and payments are digital) or if a professional's gross receipts exceed ₹50 lakh, which applies directly to Tax Audit FAQ activities.
4. What is the due date for filing a Tax Audit report?
The due date to submit the Tax Audit report (Form 3CA/3CB and 3CD) on the income tax portal is September 30 of the Assessment Year (one month prior to the ITR filing deadline of October 31).
5. What is an Internal Audit? Who needs it?
An internal audit is an independent appraisal of an organization's internal controls, processes, risk management, and governance. Under Section 138 of the Companies Act, specific classes of listed and unlisted companies must appoint an internal auditor.
6. What is a Virtual CFO?
A Virtual CFO (Chief Financial Officer) is an outsourced service provider that offers strategic financial management, forecasting, budgeting, cash flow planning, and compliance oversight to startups and SMEs on a part-time or advisory basis.
7. What is UDIN, and why is it mandatory for CAs?
UDIN (Unique Document Identification Number) is a unique 18-digit number generated by Chartered Accountants on the ICAI portal for every certificate, audit report, and document they sign. It prevents forgery and verifies the document's authenticity.
8. What is the threshold for mandatory appointment of an Auditor in a Company?
Every company must appoint its first auditor within 30 days of incorporation at the board level. The auditor is then ratified/appointed in the first Annual General Meeting (AGM) for a term of 5 years.
9. What are the common accounting software used by Indian businesses?
Common software includes TallyPrime (widely used for traditional accounts/inventory), Zoho Books (cloud-based, modern compliance), QuickBooks, Busy, and custom ERP systems like SAP or Oracle.
10. What is a Net Worth Certificate? Who issues it?
A Net Worth Certificate states the financial worth of an individual or entity (assets minus liabilities). It must be certified by a practicing Chartered Accountant (CA) with a valid UDIN and is required for visa applications, tenders, and bank loans.
11. What is a Solvency Certificate?
A Solvency Certificate is a document showing that an individual or entity is financially stable and capable of meeting their financial liabilities. It is issued by a commercial bank or a Chartered Accountant based on asset holdings.
12. What is CARO (Companies Auditor's Report Order)?
CARO is an additional reporting requirement for statutory auditors of specific companies. The auditor must report on specific matters like fixed assets, inventory, loans, internal controls, statutory dues, and transactions with related parties.
13. What is the penalty for late filing of financial statements (AOC-4) with ROC?
The late fee for filing Form AOC-4 (Financial Statements) is ₹100 per day of delay. Additionally, the company and its directors can be penalized for non-compliance.
14. What is the difference between cash system and accrual system of accounting?
Cash accounting records revenues when cash is received and expenses when cash is paid. Accrual accounting records revenues when earned and expenses when incurred, regardless of cash flow. Companies must follow the accrual system.
15. What are Accounting Standards (AS) and Ind AS?
Accounting Standards (AS) are guidelines issued by the ICAI to standardize accounting practices. Ind AS (Indian Accounting Standards) are aligned with global IFRS standards and are mandatory for listed companies and large unlisted companies with net worth >= ₹250 crore.