Call For Business Enquiries : +91 97650 00966 / +91 98190 00511 / +91 98218 32683
Call For Business Enquiries : +91 97650 00966 / +91 98190 00511 / +91 98218 32683
Statutory Audit · Panaji, Goa
Independent audit of company financial statements under Sections 139–143 of the Companies Act, 2013 — conducted under ICAI Standards on Auditing, with the CARO 2020 report and a signed Section 143 opinion. Mandatory for every company, regardless of turnover.
Overview
The statutory audit is the cornerstone of financial accountability for every company registered in India. Unlike a tax audit, which verifies tax compliance, or an internal audit, which evaluates controls, the statutory audit is an independent examination of a company's annual financial statements — balance sheet, profit and loss account, cash flow statement and notes — to express an opinion on whether they give a true and fair view. That opinion, expressed in the Statutory Auditor's Report under Section 143, is addressed to the shareholders and carries significant legal weight: it is the basis on which shareholders, lenders and regulators rely on the company's financial information.
N D Savla & Associates conducts statutory audits for private limited companies, public limited companies and OPCs across Goa — from appointment under Section 139 through to the signed report: planning and risk assessment, internal control evaluation, substantive testing, verification of compliance with the Companies Act and applicable accounting standards (Ind AS or AS), the Management Representation Letter, and the CARO 2020 report where applicable. We are familiar with the accounting nuances of Goa's key industries — hotel and hospitality, real estate project accounting, pharmaceutical exports, mining royalties and casino operations.
For the tax audit under Section 44AB — a separate and concurrent annual requirement above the turnover threshold — see our Income Tax Audit guide. For the broader overview, see our Audit & Assurance Services hub.
Who must comply
Section 139 makes it mandatory for every company — regardless of size, turnover or nature of business — to appoint a Statutory Auditor. There is no turnover threshold, no profit threshold and no activity threshold.
Appoint us as auditor →The most common structure in Goa — hotels, restaurants, resorts, retail, IT companies, developers and contractors — all audited every year regardless of turnover.
Subject to the same requirement, with additional compliance obligations for listed companies.
Single-member companies must also have their accounts audited every year.
Non-profit companies registered under Section 8 must also have a statutory audit.
Even a company with zero activity, marked dormant under Section 455, must comply unless specifically exempted by the Registrar of Companies.
The auditor
Under Section 141, only a practising Chartered Accountant, or a firm of CAs, holding an ICAI Certificate of Practice can be appointed. The auditor must be independent — a CA who is a director, promoter, employee, relative in specified ways, or who holds a material financial relationship with the company cannot be appointed. ICAI's Code of Ethics gives the detailed guidance.
The first Statutory Auditor is appointed by the Board within 30 days of incorporation, or by shareholders at a General Meeting within 90 days if the Board fails to do so. At every AGM the shareholders ratify the continuing auditor or appoint a new one. Form ADT-1 must be filed on the MCA portal at mca.gov.in within 15 days of appointment.
Listed companies, unlisted public companies with paid-up capital of Rs. 10 crore or more, and other specified large companies must rotate individual auditors every 5 years and audit firms every 10 years. Private limited companies below the thresholds have no mandatory rotation. On resignation, the outgoing auditor files Form ADT-3 and ADT-1 is filed for the new appointment.
Our process
Independence checks, engagement letter, understanding the business, risk assessment and a documented audit plan.
Design and operating effectiveness of key controls, IT general controls, walk-through testing and a management letter.
Analytical procedures, vouching, physical verification, third-party confirmations and year-end cut-off checks.
Subsequent events, going concern assessment, Management Representation Letter, and the signed audit report.
Acceptance in compliance with ICAI independence and ethics requirements, with a signed engagement letter. We obtain a thorough understanding of the business — industry, major revenue streams, key risks, control environment and accounting policies — then identify areas of significant risk (revenue recognition in a construction company, inventory valuation in a hotel, related party transactions in a family business) and design procedures to address them, documenting the approach, team, timeline and focus areas.
Assessment of the design and operating effectiveness of key controls — purchase approval, sales invoicing, cash management, payroll, bank reconciliation — and of IT general and application controls where accounting is automated. Walk-through testing traces selected transactions from initiation through the system to the financial statement. Significant weaknesses are communicated in a management letter with recommendations.
Analytical comparison of current figures against prior years, budgets and industry benchmarks; vouching of selected revenue and expense transactions against invoices, contracts, payment records and approvals; physical count of inventories, inspection of major fixed assets and confirmation of cash; independent third-party confirmations of bank, receivable and payable balances; and verification of year-end accruals, prepayments, provisions and cut-off completeness.
Review of significant events after the balance sheet date up to the report date; going concern evaluation over the next 12 months; a Management Representation Letter formally confirming information provided; and a draft report shared with management for response before the final report is signed and issued.
CARO 2020
CARO 2020 requires a separate section in the audit report beyond the main opinion. It applies to all companies except private limited companies meeting all of: paid-up capital and reserves of Rs. 1 crore or less; borrowings from banks and financial institutions of Rs. 1 crore or less; turnover of Rs. 10 crore or less. Most active Goa companies exceed at least one threshold.
| CARO 2020 matter | What must be reported | Goa relevance |
|---|---|---|
| Fixed assets — Clause 3(i) | Whether proper records are maintained; physical verification done; discrepancies found; title deeds held | Hotels, real estate, mining |
| Inventories — Clause 3(ii) | Physical verification during the year; discrepancies between physical and book records | Hotels, retail, pharma |
| Loans and advances — Clause 3(iii) | Loans, advances and guarantees to subsidiaries, JVs and associates; terms, interest, overdue amounts | Hotel groups with subsidiaries |
| Deposits — Clause 3(v) | Whether deposits have been accepted; compliance with RBI directives; pending CLB/NCLT orders | Real estate advance collections |
| Cost records — Clause 3(vi) | Whether the cost records prescribed by the Central Government are maintained | Pharma and manufacturing |
| Statutory dues — Clause 3(vii) | GST, PF, ESI, income tax, customs and TDS — regularly deposited; disputed arrears | All companies |
| Fraud — Clause 3(xi) | Any fraud noticed or reported during the year; nature of fraud; amounts involved | Critical for all sectors |
| Nidhi company — Clause 3(xii) | Required only where the entity is a Nidhi company | Rarely applicable in Goa |
| Related party transactions — Clause 3(xiii) | Whether transactions are at arm's length; Section 177 and 188 compliance | Hotel groups, family businesses |
| Internal audit — Clause 3(xiv) | Whether the internal audit system is commensurate with size and business | All larger companies |
| Cash losses — Clause 3(xv) | Whether cash losses have been incurred, in the current and preceding year | Pandemic-impacted hotels |
The opinion
Sector focus
Room revenue verified through occupancy statistics cross-referenced with check-in and check-out records; F&B revenue reconciled across outlets; advance booking liability computed and carried over; GST at applicable tariff slabs; excise compliance for bar operations; foreign exchange receipt reporting for overseas guests; and related party review for multi-entity hotel chains. CARO 2020's requirement on title to land and buildings is particularly significant for hotels that own their properties, as Goa's land records are complex and title disputes are not uncommon.
Project cost accounting, percentage completion computation, RERA Act 2016 compliance including separate project bank accounts and mandatory deposits, GST on under-construction property at 5% and 1% after recent amendments, and advance collection accounting. Ind AS 115 has transformed real estate revenue recognition and many Goa developers have needed to restate their policies — our audit covers the Ind AS 115 implementation and the reconciliation between RERA-reported progress and accounting-reported revenue.
Frequently asked questions
Yes. Even a company incorporated in the last month of the financial year with no transactions must appoint a Statutory Auditor and get a statutory audit done for that year. The report for a nil or dormant company is straightforward, but it is still legally required.
Audited financial statements, attached to the Board's Report and Directors' Report, must be adopted at the AGM, which must be held within 6 months of the financial year end — 30 September for a 31 March year-end. After the AGM, the financial statements in Form AOC-4 and the annual return in Form MGT-7/7A must be filed on the MCA portal within 30 days.
No. The Statutory Auditor must be independent. If the same CA firm or individual prepares the company's books, they cannot simultaneously serve as Statutory Auditor for those accounts — that creates a self-review threat under ICAI's Code of Ethics. A different CA firm should be appointed.
The Companies Act does not prescribe a specific deadline for completing the audit itself — the AGM deadline is the practical driver. If the financial statements are not ready for the AGM within 6 months of year end, the company may need an ROC extension for holding the AGM. Late filing of AOC-4 after the AGM attracts additional fees of Rs. 100 per day, and persistent non-compliance can lead to ROC inquiry, striking off of the company and disqualification of directors.
CARO 2020 applies to all companies except private limited companies meeting all three conditions: paid-up capital and reserves of Rs. 1 crore or less, borrowings from banks and financial institutions of Rs. 1 crore or less, and turnover of Rs. 10 crore or less. Most active companies exceed at least one of these, which makes CARO applicable.
Listed companies, unlisted public companies with paid-up capital of Rs. 10 crore or more, and other specified large companies must rotate individual auditors every 5 years and audit firms every 10 years. Private limited companies below the thresholds have no mandatory rotation, though a cooling-off period applies after the maximum permitted consecutive terms.
Related audit services
Statutory audit under the Companies Act 2013 for hotels, real estate, pharma and all Goa businesses. Book a free consultation with a qualified Chartered Accountant.