An order named Companies ( Auditor’s Report ) Order, 2020 has been released by the Ministry of Corporate Affairs (MCA). The recently released Companies (Auditor’s Report) Order 2020 will be applicable to all the companies along with foreign companies and it will come to action when it will be published in the Official Gazette of India.
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This released order engraving that every report of the auditor under Section 143 of Companies Act, 2013 must include the matters as specified under paragraphs 3 and 4. If in case the auditor’s report concerns the consolidated financial statements, then this order will not be applied.
The Companies ( Auditor’s Report ) Order, 2020 elaborated on all the elements which are to be involved in the auditor’s report. Wherein, the following details of the subject-matter are enlisted below.
The report must consist that the company is maintaining proper records showing full particulars such as:
- Quantitative information of the state of property, plant, and equipment
- Physical verification of the property, plant, and equipment
- Reveal the details of the title deeds of the immovable property
- Revaluation of the property, plant, and equipment and if there is more than 10% of the change in the property, plant, and equipment
- Proper Information of all the proceedings, against the company on the holding of Benami property
- Physical verifications of inventory or some discrepancies of 10% or more
- Information about all the investments done by the company, security or guarantee given by the company
- Proper Information on the payment concerning the statutory dues such as GST, provident Funds, Custom Duty, etc
- Information of any default done by the company in making the repayment of the loan
- Proper and accurate details of the funds raised by a company by the way of the public offer
- Details of any fraud done by the company, and many more
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The Companies or Auditor’s Report Order 2020 of any company is deemed to explain the reason for unfavorable or qualified answers.
