Ad Blocker Detected
Our website is made possible by displaying online advertisements to our visitors. Please consider supporting us by disabling your ad blocker.
Companies (Auditor’s Report) Order, 2020 has been notified and following are the major changes vis-a-vis CARO,2016.
- Number of reporting clauses in paragraph 3 have been increased to 21 from the earlier 16 clauses.
- CARO,2020 focuses on reporting of “Property, Plant & Equipment”. Earlier reporting was required on all fixed assets.
- Reporting on “Revaluation of PPE” by the company.
- Reporting of proceedings under the Benami Transactions (Prohibition) Act,1988
- Reporting in respect of compliance in case of company being sanctioned working capital exceeding Five crore rupees or more from banks or financial institutions.
- Whether the quarterly returns or statements filed by the company with such banks or financial institutions are in agreement with the books of accounts of the said company.
- Reporting of investments in or providing of guarantee or security or granting any loans or advances to companies, firms, LLPs or any other parties.
- Reporting of compliances with the RBI directives and the provisions of Companies Act in regard to deemed deposits.
- Reporting with respect to transactions not recorded in the books of accounts surrendered or disclosed as income in the Income Tax proceedings.
- Comprehensive reporting requirement for default in the repayment of loans/other borrowings or in the payment of interest.
- Reporting on treatment by auditor of whistle blower complaints received during the year by the company.
- Whether the company has revalued its PPE (including Right to use assets) or intangible assets or both during the year.
- Auditor also needs to specifically comment on coverage and procedure adopted for inventory management.
- Materiality has been taken as 10% or more in each class of inventory.
You can access the full CARO 2020 pdf here