Analysis of Tax Audit – Forms 3CA, 3CB, 3CD & 3CE

Income tax rules require few taxpayers to revise their accounts 44AB. The auditor must present the audit report in a specified audit form together with detailed information.

Audit Forms

The review report must be presented in one of the following forms:

Form 3CA – For taxpayers engaged in business or profession and already authorized to have their accounts revised under other laws (ie, other than tax).
An undertaking is obliged to have its accounts revised on the basis of the 2013 Act. Thus, it will form 3CA.

Form 3CB – For taxpayers who carry out a business or profession but are not required to have their accounts revised under other laws.

Information about Form 3CA

Section 1

  • Name and address of the taxpayer together with the fixed number of the account,
  • Name of Auditor (Individual / Company as applicable)
  • Laws whose accounts have been audited (eg: Companies)
  • Date of Audit Report
  • Profit and loss account/income and expenses (start date and closing date)
  • Balance sheet date

Section 2

  • Declaration of attaching forms 3CD along with the audit report

Section 3

  • Review comments / Qualities found in information related to Form 3CD

Section 4

  • Place and date of signature of the audit report
  • Name, address and membership number of the auditor
  • Stamp/seal of an accountant

Information about Form 3CB

Section 1

  • Balance sheet date
  • Profit and loss account/income and expenses (start date and closing date)
  • Name and address of the taxpayer together with the fixed number of the account

Section 2

Section 3 (a)

  • Audit Comments / Abilities / Comments / Discrepancies

Section 3 (b)

Statement by the auditor regarding –

  • To get all the information and explanations necessary for the audit
  • Ensuring that the organization (including branch offices) maintains proper accounting
  • Balance sheet and profit and loss account gives a true and fair view

Section 4

  • Declaration of attaching forms 3CD along with the audit report

Section 5

  • Audits / Discrepancies found in information related to Form 3CD

Section 6

  • Place and date of signature of an audit report
  • Name, address and membership number of the auditor
  • Stamp/seal of the accountant

Form 3CE – Audit Report for Non-residents and Foreign Companies

Residents of non-residents and foreign companies who receive patents or fees for technical services from the government or Indian concerns must have their accounts revised.

Information about Form 3CE

Section 1

  • Name and address of foreigners together with the fixed number of the account
  • Financial year, where the auditor has conducted the audit

Section 2

  • A statement to obtain all the information and explanations necessary for the audit

Section 3

  • Certification of permanent establishment / permanent establishment in India.

Section 4

  • Statement of income from royalties/fees for technical services under Chapter 44 for the relevant food year.

Section 5

  • Signature and name of auditor together with stamp/seal

Due date to receive the audit report

  • A taxpayer must receive an audit report no later than 30 September of the assessment year concerned. By 2017-18, the audit report will be available until September 30, 2018.
  • The auditor will submit an tax audit report to the taxpayer electronically, which must be approved by the taxpayer before it will be filed.

Penalty interest because the audit report is not submitted

Food Representative may impose a penalty on u / s 271B if the taxpayer does not get his accounts audited or file the audit report. The minimum reduction may be 0.5% of total sales, turnover or gross tax, which may rise to Rs. 1,50,000. However, if a taxpayer gives a reasonable reason for a violation, no penalty will be imposed.

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Certicom Consulting [ Kedia Arpana & Co ] is a group of Chartered Accountants in the business of Small Business Setup & Statutory Compliance including for Professionals for the past 15 years. We have been an established and popular company with an excellent track record for the best customer satisfaction.

Certicom Consulting

Certicom Consulting [ Kedia Arpana & Co ] is a group of Chartered Accountants in the business of Small Business Setup & Statutory Compliance including for Professionals for the past 15 years. We have been an established and popular company with an excellent track record for the best customer satisfaction.