Internal audit is a type of consulting engagement and an objective assessment of an Enterprise's operations.
Internal audits can be conducted to assess the strengths and weaknesses of financial, operational and information technology systems. Having regular internal audits can help a business improve governance, reduce risks, obtain insights and develop good management systems. Having a good internal audit team committed to independence, integrity, and accountability, would serve as an excellent source of advice for the Management team.
Internal Auditors, unlike Statutory Auditors, do not have any statutory or legal responsibilities. Hence, internal Auditors have the liberty to consider issues beyond their scope of the audit and can help an organization with its growth. Hence, a good internal audit not only provides assurance but also consulting to help the business improve or mitigate weaknesses. Internal auditors are appointed by the management of the company.
As per section 138 of the Indian Companies Act, 2013 read with Rule 13 Of Companies (Accounts) Rules, 2014, the following class of companies are required to appoint Internal Auditors:
(a) every listed company
(b) every unlisted public company having–
(i) paid-up share capital of fifty crore rupees or more during the preceding financial year; or
(ii) turnover of two hundred crore rupees or more during the preceding financial year; or
(iii) outstanding loans or borrowings from banks or public financial institutions exceeding one hundred crore rupees or more at any point of time during the preceding financial year; or
(iv) outstanding deposits of twenty-five crore rupees or more at any point of time during the preceding financial year; and
(c) every private company having–
(i) turnover of two hundred crore rupees or more during the preceding financial year; or
(ii) outstanding loans or borrowings from banks or public financial institutions exceeding one hundred crore rupees or more at any point of time during the preceding financial year.
For more details regarding other provisions for companies, please visit
http://www.mca.gov.in/For information regarding GST Audit, click
https://allroundtaxsolutions.com/gst-audit/