Services
Audit Services
We provide comprehensive audit services to ensure that your company meets all legal, regulatory, and compliance requirements. Our team conducts thorough audits to identify risks, uncover inefficiencies, and ensure adherence to statutory and industry standards.
Secretarial Audit and Due Diligence Services
Our Secretarial Audit and Due Diligence services are vital tools for ensuring legal compliance, risk mitigation, and robust corporate governance. We help companies navigate the complex regulatory environment by conducting thorough assessments of statutory records, operational practices, and governance frameworks.
Secretarial Audit (Section 204, Companies Act, 2013)
- Applicability: Mandatory for the following companies:
- Every listed company
- Every public company having:
- Paid-up share capital ≥ ₹50 crore, or
- Turnover ≥ ₹250 crore
- Conducted By: A practicing Company Secretary (PCS)- Peer Reviewed Reporting Format: Secretarial Audit Report is filed in Form MR-3 and annexed to the Board’s Report in the Annual Report.
- Penalty for Non-Compliance: Failure to comply may attract penalties under Section 204(4) and other applicable provisions of the Act.
Key Compliance and Benefits
- Section 204 mandates secretarial audits for listed and large public companies.
- Statutory audits and tax audits help businesses avoid legal penalties and ensure smooth operations.
- Regular audits enhance corporate governance and stakeholder trust, especially for investors and banks
Due Diligence
- When It’s Needed:
- Mergers and acquisitions (M&A)
- Private equity or venture capital funding
- Strategic partnerships or joint ventures
- Initial Public Offerings (IPO)
- Compliance health checks before investor entry or sale
- Key Focus Areas:
- Review of statutory records and regulatory filings
- Verification of legal ownership (shares, IP, assets)
- Identification of pending litigations, non-compliances, and contractual obligations
- Important Tip: Conducting early-stage due diligence helps uncover hidden liabilities and strengthens your negotiating position. Always ensure a confidentiality agreement (NDA) is in place before sharing any sensitive information
- Objective: To ensure compliance with the Companies Act, 2013, and other statutory laws.
- Scope: Includes verification of board meetings, shareholder meetings, statutory filings, shareholding patterns, etc.
- Benefits:
- Identifies non-compliance risks
- Enhances corporate governance and transparency
- Mitigates potential penalties or legal issues
We offer detailed Legal and Secretarial Due Diligence—especially crucial for, acquisitions, private equity deals, and strategic investments. Our due diligence provides a 360-degree view of the target company’s legal standing, compliance history, and risk exposure.
Scope of Due Diligence Includes:
- Risk Assessment: Identification and analysis of legal, contractual, and regulatory risks that may impact the transaction or investment.
- Legal Compliance Review: Ensuring all corporate records, licenses, and statutory filings are in order and up to date.
- Transparency & Disclosure: Comprehensive analysis of agreements, legal proceedings, financial records, IP rights, and other material documents.
- Support in Negotiation & Valuation: Due diligence findings guide deal valuation, negotiations, and the drafting of terms and conditions.
- Informed Decision-Making: We equip stakeholders with the insights they need to make confident, well-informed decisions.
Bank Due Diligence
Introduction
Bank due diligence is a systematic process undertaken by banks, financial institutions, investors, or businesses to assess the financial, legal, and operational risks associated with a potential investment, partnership, lending decision, or acquisition. In today’s regulatory and risk-sensitive environment, conducting thorough due diligence is essential for protecting financial interests and ensuring compliance with laws and best practices.
1. What Is Bank Due Diligence?
Bank due diligence refers to the process of reviewing and evaluating a company or individual’s financial health, legal standing, operational practices, and compliance history before initiating or continuing a financial relationship. This can include:
- Lending due diligence (for loans or credit facilities)
- Investment due diligence (for mergers, acquisitions, or private equity)
- Regulatory due diligence (for anti-money laundering (AML), KYC, and CERSAI compliance)
- Operational due diligence (for assessing internal controls and governance)
2. Importance of Bank Due Diligence
- Risk Mitigation: Identifies financial red flags such as non-performing assets, legal disputes, or poor credit history.
- Regulatory Compliance: Ensures the bank or institution is not dealing with entities involved in money laundering, terrorism financing, or fraud.
- Informed Decision-Making: Provides clarity on the creditworthiness and financial behavior of borrowers or partners.
- Valuation Accuracy: Helps investors and banks accurately assess the valuation of the business or asset.
- Safeguards Reputation: Avoids association with questionable entities that may lead to reputational damage.
3. Key Components of Bank Due Diligence
A. Financial Due Diligence
- Review of audited financial statements
- Evaluation of cash flows, debt, and repayment capacity
- Analysis of profit margins, liquidity ratios, and working capital
B. Legal Due Diligence
- Examination of corporate structure and ownership
- Review of ongoing litigations and liabilities
- Verification of compliance with Companies Act, FEMA, SEBI, and RBI regulations
C. Operational Due Diligence
- Assessment of governance practices and internal controls
- Review of business model and sustainability
- Analysis of management competence and background
D. Compliance & KYC/AML Due Diligence
- Verification of KYC documents of directors and shareholders
- Screening through CIBIL, CERSAI, and other credit bureaus
- Checks against RBI defaulter lists, wilful defaulters, and PEP (Politically Exposed Person) databases
4. When Is Bank Due Diligence Conducted?
- Before sanctioning a loan or credit facility
- During periodic reviews of borrower accounts
- Prior to mergers, acquisitions, or strategic partnerships
- While onboarding new vendors or customers in sensitive sectors
- For compliance audits or internal risk reviews
5. Challenges in Bank Due Diligence
- Expert legal drafting and compliance
- End-to-end support from name approval to post-incorporation filings
- Guidance on choosing the right entity structure
- Faster registration through centralized handling of documentation
6. Best Practices
- Start early: Early-stage due diligence uncovers hidden liabilities and improves negotiating power.
- Use NDAs: Always sign confidentiality agreements before accessing sensitive data.
- Engage professionals: Involve financial analysts, legal advisors, and company secretaries.
- Maintain documentation: Ensure every finding is well-documented and supported by evidence.
- Stay updated: Monitor regulatory updates and amend your checklists accordingly.
Conclusion
Bank due diligence is not just a compliance necessity—it's a strategic imperative. A robust due diligence process protects stakeholders, enhances transparency, and builds a foundation for sound financial decisions. Whether you're a bank, an investor, or a business engaging in transactions, due diligence should never be an afterthought.
Statutory Audit
- Purpose: Ensure your company complies with statutory obligations under the Companies Act and other applicable laws.
- Scope: Review of financial statements, verification of transactions, and overall financial health.
- Compliance: Ensure compliance with Indian Accounting Standards (Ind AS), IFRS (if applicable), and tax laws.
Tax Audit
Introduction
A Tax Audit is a mandatory audit carried out under Section 44AB of the Income Tax Act, 1961. It is aimed at ensuring the correctness of books of accounts and income reported to the Income Tax Department by certain categories of taxpayers. Unlike a statutory audit governed by the Companies Act, a tax audit specifically focuses on compliance with income tax laws.
Applicability of Tax Audit (Section 44AB)
The following assesses are required to get their accounts audited by a Chartered Accountant:
A. Business Entities
- Turnover exceeds ₹1 crore in the previous year.
- However, the limit is ₹10 crore if:
- Aggregate cash receipts and cash payments do not exceed 5% of total receipts and payments respectively.
- Digital mode of transactions is predominantly used.
B. Professionals
- Gross receipts exceed ₹50 lakhs in the previous year.
C. Presumptive Taxation Scheme (Section 44AD/44ADA/44AE)
- If a person opts out of presumptive taxation and reports income lower than the prescribed percentage and total income exceeds the basic exemption limit, a tax audit is mandatory.
2. Due Date for Tax Audit
- 30th September of the assessment year (for most taxpayers)
- 31st October if the taxpayer is required to furnish a transfer pricing report under Section 92E
3. Forms Applicable for Tax Audit
- Form 3CA: For persons who are already required to get accounts audited under any other law (e.g., Companies Act)
- Form 3CB: For others (i.e., who are not required to get statutory audit)
- Form 3CD: Statement of particulars to be furnished (Annexure with 41 Clauses including GST, TDS, depreciation, etc.)
4. Objectives of Tax Audit
- Ensure maintenance and accuracy of books of accounts
- Report observations regarding compliance with income tax provisions
- Detect fraudulent practices, if any
- Facilitate income computation and tax assessment
- Discourage tax evasion
5. Key Areas Covered in Tax Audit Report (Form 3CD)
- Nature of business or profession
- Details of partners/members and profit-sharing ratios
- Changes in accounting methods
- Quantitative details of stocks
- Depreciation claimed
- Compliance with TDS/TCS provisions
- Payment details exceeding ₹10,000 made otherwise than by account payee cheque/draft
- GST reconciliation (if applicable)
6. Penalty for Non-compliance (Section 271B)
- Penalty of 0.5% of total sales/gross receipts, subject to a maximum of ₹1,50,000 may be levied.
- However, no penalty if there is reasonable cause for the failure (e.g., natural calamities, death of accountant, etc.)
7. Role of Professionals
- Examine and verify books of accounts
- Ensure adherence to income tax provisions
- Provide disclosures as per Form 3CD
- Offer tax-saving recommendations and compliance strategies
8. Practical Considerations
- Reconcile turnover and taxes with GST returns
- Keep audit trails of digital and cash transactions
- Maintain proper records of TDS deducted and deposited
- Track payments made to related parties and ensure arm’s length pricing
- Document explanations for any inconsistencies or deviations
Conclusion
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A tax audit is more than a compliance exercise—it’s a vital part of financial health assessment and tax transparency. Proper planning and timely execution of tax audits not only ensure legal compliance but also build credibility with financial institutions and investors.