Presentation is loading. Please wait.

Presentation is loading. Please wait.

© Tally Solutions Pvt. Ltd. All Rights Reserved Tally.ERP 9 Auditors’ Edition Tax Audit (Sec 44AB of IT Act)

Similar presentations


Presentation on theme: "© Tally Solutions Pvt. Ltd. All Rights Reserved Tally.ERP 9 Auditors’ Edition Tax Audit (Sec 44AB of IT Act)"— Presentation transcript:

1 © Tally Solutions Pvt. Ltd. All Rights Reserved Tally.ERP 9 Auditors’ Edition Tax Audit (Sec 44AB of IT Act)

2 © Tally Solutions Pvt. Ltd. All Rights Reserved 2 Agenda Tax Audit under Sec 44AB using Tally.ERP 9 AE Benefits Definition & Audit Objective Audit & Analysis-Features Clause 16, 17h, 18, 21, 24a, 24b & 27 Forms 3CD, 3CA & 3CB

3 © Tally Solutions Pvt. Ltd. All Rights Reserved 3 Benefits The Tally.ERP 9 AE aids Auditors to perform a Tax Audit Enables exceptional reporting – saves time and cost Preform audit to generate annexures for 7 clauses supported under Sec 44AB with ease Review / scrutiny of relevant cash and unusual transactions Determine timely remittance of statutory dues Aids in preparing Form 3CD, 3CA, 3CB

4 © Tally Solutions Pvt. Ltd. All Rights Reserved 4 Definition & Audit Objective Audit of certain persons under Sec 44AB of the Income Tax Act whose total sales, turnover or gross receipts, as the case may be, exceed(s) the following limits: Businesses: Profits and Gains more than Rs.40 lakhs per annum Professionals: Gross receipts above Rs.10 lakhs per annum (Note: The limits have been increased to Rs.60 lakhs for businesses and Rs.15 lakhs for professionals from FY ) Audit Objective: Verify compliance with provisions of Sec 44AB of the IT Act Confirm accounting records are maintained properly and reflect the true income of the assessee

5 © Tally Solutions Pvt. Ltd. All Rights Reserved 5 Audit & Compliance Menu Tally Main -> Gateway of Tally Open Tally.ERP 9 Auditors’ Edition. Select the required Company to display Gateway of Tally. Select Audit & Compliance under Audit to access the audit features.

6 © Tally Solutions Pvt. Ltd. All Rights Reserved 6 Access to Audit & Compliance Menu When the Client activates the Security Control – Scenario 1 Click Alt+F3:Cmp Info in Gateway of Tally to display the Company Alteration screen. Under Security Control: Select Yes for Use Security Control Enter details for Name of Administrator & Password fields Accept and save the entries.

7 © Tally Solutions Pvt. Ltd. All Rights Reserved 7 Access to Audit & Compliance Menu When the Auditor provides the access details – Scenario2 Click Audit & Compliance in Gateway of Tally screen to display Company Alteration- Enable Security screen. Enable access to use audit features by entering: Name of Administrator Password Accept and save the login details for access.

8 © Tally Solutions Pvt. Ltd. All Rights Reserved 8 Tax Audit Menu The Audit & Compliance Menu with the available features. Tally Main -> Gateway of Tally->Audit & Compliance The menus under Tax Audit are: 44AB Audit Form 3CD Form 3CA Form 3CB

9 © Tally Solutions Pvt. Ltd. All Rights Reserved 9 Tax Audit Dashboard Gateway of Tally > Audit & Compliance > Tax Audit □ Clause No. in Form 3CD □ Description of the clause under audit □ No. of unaudited Vouchers □ No. of audited Vouchers □ Audit Status □ No. of Vouchers under observation □ No. of Vouchers requiring clarifications from client □ No. of clarified Vouchers for re-audit □ No. of altered Vouchers for re-audit

10 © Tally Solutions Pvt. Ltd. All Rights Reserved 10 Cl. 16- Payment of Statutory Dues Verify employee contributions towards statutory funds (PF,ESI,etc), employee bonus and commission payments. Use the Bonus, PF, ESI Recoveries feature to verify remittance of statutory dues in time to Government To perform the audit under this clause, the Payroll option in F11:Features in Tally.ERP 9 has to be enabled and the payroll transactions have to be accounted

11 © Tally Solutions Pvt. Ltd. All Rights Reserved 11 Cl. 16- Payment of Statutory Dues Verify information in the Masters created in the Client payroll data. Determine the pay heads created in payroll masters Click F5: Masters to know these payroll masters

12 © Tally Solutions Pvt. Ltd. All Rights Reserved 12 Cl. 16- Payment of Statutory Dues Verify PF,Bonus & other Statutory dues- Employee & Employer, Charges, Payment Status. View a snapshot of the monthly PF related payments, charges, due dates, etc. Click F6: Payment Summary to know the monthly deductions and charges information. Find if payments are made in time.

13 © Tally Solutions Pvt. Ltd. All Rights Reserved 13 Cl. 16- Payment of Statutory Dues Know the exceptions in Clause 16 – Dues paid late or partially paid. View the late/partial payments of statutory dues to concerned authorities. Click Alt+X: Exceptions to display such exceptions.

14 © Tally Solutions Pvt. Ltd. All Rights Reserved 14 Cl. 16- Payment of Statutory Dues Configure report display under the clause as per requirements. Configure display of details under Cl. 16 as per requirements: Click F12: Configure to display details of: PF ESI Prof Tax Bonus Voucher Audits

15 © Tally Solutions Pvt. Ltd. All Rights Reserved 15 Cl. 16- Payment of Statutory Dues Audit transactions easily. Tally MAIN> Gateway of Tally > Audit & Compliance >Tax Audit > Employees Deduction > Payroll Monthly Summary. Execute above steps: & Select transaction(s) by pressing Spacebar/Ctrl+Spaceb ar (To select all transactions). Click F9:Audit to perform the audit. In the Audit Details screen: Select required status under Audit Status Enter remarks under Audit Note. Values for Audit Status are: Unknown Disallowed Late Paid Need Clarification Paid on Time Under Observation

16 © Tally Solutions Pvt. Ltd. All Rights Reserved 16 Printed Annexures to Form 3CD Clause 16: Click Alt+P in Bonus, PF, ESI Recoveries

17 © Tally Solutions Pvt. Ltd. All Rights Reserved 17 Cl. 17h- Amounts inadmissible u/s 40A(3) Verify and disallow payments aggregating and above prescribed cash limits Click F11:Features in Cash Payments screen. The Company Operations Alteration screen is displayed. Audit rule under Inadmissible Cash Payments U/s 40A (3) is defined. Define new value if required.

18 © Tally Solutions Pvt. Ltd. All Rights Reserved 18 Cl. 17h- Amounts inadmissible u/s 40A(3) Exclude ledger account(s) for which cash payments aggregating to Rs in a day are allowed. Click Ctrl+F9:Master button in Cash Payments screen. Select the ledger account in Select Ledger screen. Exclude the ledger account in Ledger Alteration screen from the scope of audit under Rule 6DD of IT.

19 © Tally Solutions Pvt. Ltd. All Rights Reserved 19 Cl. 17h- Amounts inadmissible u/s 40A(3) Define amount range for selecting transactions for audit of cash payments in a day. Click F10: Range wise to display the Lowest and Highest ranges and the numbers of cash payment vouchers. Click F6: Amount wise to define new values for the Lowest and Highest range of cash payments. Define new amount range as per requirements.

20 © Tally Solutions Pvt. Ltd. All Rights Reserved 20 Cl. 17h- Amounts inadmissible u/s 40A(3) Verify if the Client has issued Bearer Cheques to suppliers. Click Alt + B: Bank Summary to display ledger payments through the bank account. Specify payments made by bearer in consultation with client.

21 © Tally Solutions Pvt. Ltd. All Rights Reserved 21 Cl. 17h- Amounts inadmissible u/s 40A(3) Configure the display of details in the feature. Configure the following display details: High/Low value vouchers Limit for displaying cash payments Display of low valued payments

22 © Tally Solutions Pvt. Ltd. All Rights Reserved 22 Cl. 17h- Amounts inadmissible u/s 40A(3) Click F9:Audit to audit Transactions. In the Audit Details screen: Select required status under Audit Status Enter the appropriate value under Amount Enter remarks under Audit Note. Select the required Ledger Account’s cash payment for audit. Values available for Audit Status are: Unknown Allowed Disallowed Need Clarification Under Observation

23 © Tally Solutions Pvt. Ltd. All Rights Reserved 23 Printed Annexures to Form 3CD Clause 17(h): Click Alt+P in Amounts Inadmissible under u/s 40A(3): Contd…

24 © Tally Solutions Pvt. Ltd. All Rights Reserved 24 Cl. 18- Payments to Specified Persons Verify and disallow expenses/payments made to specified persons if found to be excessive/unreasonable Use the Payments to Specified Persons feature to audit excessive and unreasonable payments made to specified persons. Click Ctrl+F9: Master and select the appropriate ledger accounts in consultation with the Client from the Select Item screen. Configure the ledger accounts in Related Party Configuration screen as per discussions with the Client. Click F9:Update to configure. The Payments to Specified Persons details display after related party configuration. -Sec 40A (2) (b) You can alternatively configure the ledger accounts as Specified Persons through ledger creation under Masters menu. Configure the display details through F12: Configure. -Sec 40A (2) (b) Configure the display details under Other Information in Ledger Alteration screen. Click F12: Configure. Select Yes against Use Other Information for Ledger Accounts.

25 © Tally Solutions Pvt. Ltd. All Rights Reserved 25 Cl. 18- Payments to Specified Persons Select required ledger vouchers for audit. Click F9 : Audit to audit. Select required status under Audit Status. Enter values under Amount, Nature of Payment. Record appropriate remarks under Audit Note. Auditing Payments to Specified Persons. Values are available for Audit Status. Unknown Need Clarification Not to be Reported To be Reported Under Observation

26 © Tally Solutions Pvt. Ltd. All Rights Reserved 26 Printed Annexures to Form 3CD Clause 18 : Click Alt+P in Payments to Specified Persons u/s 40A(2)(b) Contd…

27 © Tally Solutions Pvt. Ltd. All Rights Reserved 27 Cl. 21- Payments Under Section 43B Verify if sums collected, referred in clauses (a-f) of Sec 43B (employer related statutory deductions/taxes), are remitted to the Funds/Govt before the due date of filing the tax return Use Payments Under Section 43B feature to audit timely remittance of statutory dues to various Funds/Govt. To perform the audit under this clause, the Payroll option in F11:Features in Tally.ERP 9 has to be enabled and the payroll transactions have to be accounted

28 © Tally Solutions Pvt. Ltd. All Rights Reserved 28 Cl. 21- Payments Under Section 43B Verify payments referred in clauses (a-f) of Sec 43B (employer related statutory deductions/taxes) are remitted in time. Execute the steps: Tally MAIN > Gateway of Tally > Audit & Compliance > Tax Audit > TCS Payable Summary > TCS Monthly Summary > TCS Payment Vouchers to view the timely payment of TCS for the selected month. Execute the steps: Tally MAIN > Gateway of Tally > Audit & Compliance > Tax Audit > Service Tax Payable Summary > Service Tax Monthly Summary > Service Tax Payment Vouchers to view the timely payment of Service Tax for the selected month. Enable the Service Tax/TCS and other tax features in F11:Features under F3; Statutory in default Tally.ERP 9 before auditing transactions under Cl.21.

29 © Tally Solutions Pvt. Ltd. All Rights Reserved 29 Cl. 21- Payments Under Section 43B Audit of payments of statutory levies (e.g.TCS)under Sec 43B. Select required ledger vouchers for audit. Click F9 : Audit to audit. Select required status under Audit Status. Record appropriate remarks under Audit Note Values for Audit Status available are: Unknown Audited Need Clarification Under Observation

30 © Tally Solutions Pvt. Ltd. All Rights Reserved 30 Printed Annexures to Form 3CD Clause 21: Click Alt+P in resp. screens(for e.g., Employer’s Contributions) Contd…

31 © Tally Solutions Pvt. Ltd. All Rights Reserved 31 Cl. 24(a)- Loans / Deposits Accepted-Sec 269SS Verify acceptance of loans and Deposits aggregating to and exceeding prescribed cash limits during the previous year. Use 24(a) – Loans / Deposits Accepted feature to find cash receipts (loans & deposits) accepted aggregating to and exceeding prescribed cash limits. Click F9:Master to configure the inclusion of any Ledger group for audit under the clause. Select any Group for inclusion by pressing Spacebar. Click Ctrl + A:Change to include the selected Group. Press Ctrl+Q : Quit to return to Loans and Deposits Accepted screen. Click F4: Group to select the required Group (e.g. Unsecured Loans).

32 © Tally Solutions Pvt. Ltd. All Rights Reserved 32 Cl. 24(a)- Loans / Deposits Accepted-Sec 269SS Configure the display of details in the report. Click F12:Configure to define the display of details the Loans and Deposits Accepted screen.

33 © Tally Solutions Pvt. Ltd. All Rights Reserved 33 Cl. 24(a)- Loans / Deposits Accepted-Sec 269SS Audit transactions of Loans / Deposits Accepted – Sec 269SS. Select required ledger vouchers for audit. Click F9 : Audit to audit. If there are large number of transactions, use the Alt + F12: Range to filter the display of ledger amounts greater than Rs Select required value under Audit Status. Enter value under Amount Record appropriate remarks under Audit Note Audit Status Values are: Unknown Accepted by Cash Accepted by Cheque/DD Need Clarification Not a Loan Under Observation

34 © Tally Solutions Pvt. Ltd. All Rights Reserved 34 Printed Annexures to Form 3CD Clause 24(a): Click Alt+P in Loans & Deposits Accepted -u/s 269SS

35 © Tally Solutions Pvt. Ltd. All Rights Reserved 35 Cl. 24(b)- Loans / Deposits Repaid-Sec 269T Verify repayments of Loans and Deposits aggregating to and exceeding prescribed cash limits Use the 24(b) – Loans / Deposits Repaid feature to find payments (loans & deposits) made by cash aggregating to and exceeding prescribed limits. Click F9:Master to configure the inclusion of a ledger account under the clause. Select any Group for inclusion by pressing Spacebar. Click Ctrl + A:Change to include the selected Group. Press Ctrl+Q : Quit to return to Loans and Deposits Repaid screen. Click F4:Group to select a Group.

36 © Tally Solutions Pvt. Ltd. All Rights Reserved 36 Cl. 24(b)- Loans / Deposits Repaid-Sec 269T Configure the display of details in the report. Click F12:Configure to define the display of details the Loans and Deposits Repaid screen.

37 © Tally Solutions Pvt. Ltd. All Rights Reserved 37 Cl. 24(b)- Loans / Deposits Repaid-Sec 269T Audit transactions of Loans / Deposits Repaid – Sec 269T. Select required ledger vouchers for audit. Click F9 : Audit to audit. If there are large number of transactions, use the Alt + F12: Range to filter the display of ledger amounts greater than Rs Select status under Audit Status. Enter value under Amount. Record appropriate remarks under Audit Note. Audit Status Values available are: Unknown Need Clarification Not a Loan Repaid by Cash Repaid by Cheque/DD Under Observation

38 © Tally Solutions Pvt. Ltd. All Rights Reserved 38 Printed Annexures to Form 3CD Contd… Clause 24(b): Click Alt+P in Loans & Deposits Repaid - u/s 269T

39 © Tally Solutions Pvt. Ltd. All Rights Reserved 39 Cl. 27- Tax Deducted at Source Verify remittance of taxes deducted at source have been made within time to the Government Use the Tax Deducted at Source feature to find whether tax deducted at source has been remitted within time to the Govt. Verify details under: Deduction Details Payment Details To use the Tax Deducted at Source feature, enable the TDS option in Statutory & Taxation under F11:Features in Tally.ERP 9 and account the TDS related transactions. Examine any particular detail (e.g. Deducted on Time) in the TDS Summary screen. Click Alt+F4:Party to display Party Summary details. Click Alt+F5:NOP to display the Nature of Payment Summary attracting TDS. Note: NOP-Nature of Payments.

40 © Tally Solutions Pvt. Ltd. All Rights Reserved 40 Cl. 27- Tax Deducted at Source Display the TDS expenses closing balance with the closing balances of other expenses (non-TDS). expenses. Compare TDS expenses with non TDS expenses in the TDS Summary screen. Click F5: Expenses Analysis to generate the analysis report. Verify non-TDS expenses to see if tax has to be deducted at source for them.

41 © Tally Solutions Pvt. Ltd. All Rights Reserved 41 Cl. 27- Tax Deducted at Source Select required ledger vouchers for audit. Click F9 : Audit to audit. Select required status under Audit Status. Record appropriate remarks under Audit Note. Audit transactions of Tax Deducted at Source. Values for Audit Status available are: Unknown Audited Need Clarification Under Observation

42 © Tally Solutions Pvt. Ltd. All Rights Reserved 42 Printed Annexures to Form 3CD Clause 27: Click Alt+P in TDS Summary Contd…

43 © Tally Solutions Pvt. Ltd. All Rights Reserved 43 F11: Audit Features Pre-define rules for performing audits under Sec 44AB (values under Sec 40A(3) can be re- configured by Auditor) The value for inadmissible cash payment under Cl. 17h and the due dates defined for tax and statutory deductions are used in arriving at the exceptions in the tax audit. For e.g., if the payment date for VAT is 15 th of the month, then tax paid on or before 15 th will show the status as Paid on Time. Payments after 15 th will be marked as Paid Late in the report.

44 © Tally Solutions Pvt. Ltd. All Rights Reserved 44 Forms 3CD Report Generate the tax audit report in Form 3CD for assessee whose accounts are audited under Sec 44AB for filing with IT Dept. Prepare Form 3CD Audit Report with a provision to export in Excel Gateway of Tally - > Audit & Compliance. Click Form 3CD to generate the audit report. Click Alt + F1: Detailed to view details of the report.

45 © Tally Solutions Pvt. Ltd. All Rights Reserved 45 Form 3CD Report The contents of the Form 3CD report are partly entered manually and the permanent information is taken from the master information in Tally.ERP 9 data, created during the Company creation phase.

46 © Tally Solutions Pvt. Ltd. All Rights Reserved 46 Forms 3CD Report- short cut buttons Click Alt+T: Select Text. Select standard text for entering in the report. This saves time in report preparation. Examples of standard text: Add Text Remove Text As per Annexure Cash System Mercantile System NA Nil Not Applicable

47 © Tally Solutions Pvt. Ltd. All Rights Reserved 47 Forms 3CD Report- short cut buttons Copying of configuration data- Use this feature to copy data configuration from one year to another or current company to another. Click Alt + R: Copy From to perform this operation.

48 © Tally Solutions Pvt. Ltd. All Rights Reserved 48 Forms 3CD Report The Form 3CD report after generation

49 © Tally Solutions Pvt. Ltd. All Rights Reserved 49 Forms 3CD Report The Form 3CD report after generation

50 © Tally Solutions Pvt. Ltd. All Rights Reserved 50 Forms 3CA & 3CB Form 3CA-This report is prepared when the accounts of the business/profession have been audited under any other law. Refer clause (a) of Rule 6G Form 3CB-This report is prepared in the case of a person who carries on business or profession, but not being a person referred to in clause (a) of Rule 6G.

51 © Tally Solutions Pvt. Ltd. All Rights Reserved 51 Thank You


Download ppt "© Tally Solutions Pvt. Ltd. All Rights Reserved Tally.ERP 9 Auditors’ Edition Tax Audit (Sec 44AB of IT Act)"

Similar presentations


Ads by Google