Statutory audit and tax audit: what management should expect from the process

Companies appoint auditors to obtain reasonable assurance that financial statements are free from material misstatement. Tax audits under Section 44AB focus on specific reporting in Form 3CD where tax law intersects with accounting.

Management can make audits efficient by preparing trial balances, ledgers, fixed asset registers, and related-party schedules in structured formats. Unorganised data slows sampling and expands review scope.

Expect questions on revenue recognition, expense provisioning, and GST reconciliations. Auditors are required to obtain sufficient appropriate evidence—not to assume goodwill from prior years.

Open communication about one-off transactions, litigation, and changes in accounting policies prevents surprises at the signing stage. Late disclosures often delay reporting and board approvals.

Parwal & Associates has audited entities across sectors since 1983. We combine technical rigour with practical timelines so year-end closure does not derail your operations.