Question: What Is Difference Between Tax Audit And Statutory Audit?

Is tax audit compulsory for company?

A tax audit is mandated on all companies, limited liability partnerships (LLPs), and individuals whose turnover crosses a particular threshold limit.

Taxpayers who get their accounts audited under any other law do not have to get their accounts audited again for a tax audit..

Can tax audit and statutory auditor be same?

3. Is it necessary to appoint statutory auditors as tax auditors? Section 44AB does not specify that only the statutory auditor appointed under the Companies Act should perform the tax audit. Therefore the tax audit can, be conducted either by the statutory auditor or by any other CA in practice.

What is the difference between statutory audit and internal audit?

Statutory Audit is done annually to form an opinion on the financial Statement of the Company i.e. whether they are showing the true and fair views of the affairs of the Company or not Whereas Internal Audit is done basically to detect and prevent errors and frauds.

What is the difference between tax audit and company audit?

GST Audit is a new audit type, which is conducted under the Goods and Service Act. In this type of audit, any entity whose turnover is more than Rs….GST Audit.Basis of differenceApplicabilityStatutory AuditAll CompaniesTax AuditAllGST AuditAll6 more columns

Who is liable statutory audit?

Meanwhile, a limited liability partnership (LLP) has to undergo a statutory audit only if its turnover in any financial year exceeds INR 4 million (US$55,945) or its capital contribution exceeds INR 2.5 million (US$34,963).

What are the 3 types of audits?

What Is an Audit?There are three main types of audits: external audits, internal audits, and Internal Revenue Service (IRS) audits.External audits are commonly performed by Certified Public Accounting (CPA) firms and result in an auditor’s opinion which is included in the audit report.More items…•

What companies need to be audited?

A company must have an audit if at any time in the financial year it has been:a public company (unless it’s dormant)a subsidiary company within a group which is not small.an authorised insurance company or carrying out insurance market activity.involved in banking or issuing e-money.More items…•

What are the statutory requirements of audit?

A statutory audit is a legally required review of the accuracy of a company’s or government’s financial statements and records. An audit is an examination of records held by an organization, business, government entity, or individual, which involves the analysis of financial records or other areas.

What are the audit techniques?

Auditing – Audit TechniquesVouching. When the Auditor verifies accounting transactions with documentary evidence, it is called vouching. … Confirmation. … Reconciliation. … Testing. … Physical Examination. … Analysis. … Scanning. … Inquiry.More items…

Is GST audit compulsory?

Turnover-based Audit under Section 35(5) of CGST Act If the annual turnover of a registered taxpayer is more than Rs. 2 crores^ in a financial year , he is required to get his accounts audited by a Chartered Accountant or Cost Accountant every year.

What is the limit for tax audit?

NOTE: The threshold limit of Rs 1 crore for a tax audit is proposed to be increased to Rs 5 crore with effect from AY 2020-21 (FY 2019-20) if the taxpayer’s cash receipts are limited to 5% of the gross receipts or turnover, and if the taxpayer’s cash payments are limited to 5% of the aggregate payments.

How statutory audit is done?

A statutory audit can be defined as a legally required review that is performed to check the overall accuracy of a company’s financial records and statements. … It is performed by closely examining accounting information from bookkeeping records, bank balances and financial transactions.