Introduction- OPC Audit

As per section 2(62) of the Companies Act, 2013, “One Person Company” means a company which has only one person as a member. Audit of OPC is examination of books of books of accounts of company by outside agency. Purpose of OPC audit is check & verify books of accounts & get opinion by agency. In India Practicing chartered Accountants are eligible to conduct OPC statutory audit. When an auditor audits the accounts or inspects key financial statements of a company, the findings are usually put out in a report. As like Private Limited Company , audit of OPC Is mandatory

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OPC Audit Legal Provisions

1# Auditor Appointment

Section 139 of Companies Act, 2013 OPC Company every company shall, at the first annual general meeting, appoint an individual or a firm as an auditor who shall hold office from the conclusion of that meeting till the conclusion of its sixth annual general meeting and thereafter till the conclusion of every sixth meeting and the manner and procedure of selection of auditors by the members of the company at such meeting shall be such as may be prescribed.

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2# OPC Audit Certification

Section 145 of Companies Act, 2013 The person appointed as an auditor of the company shall sign the auditor’s report or sign or certify any other document of the company in accordance with the provisions of sub-section (2) of section 141 and the qualifications, observations or comments on financial transactions or matters, which have any adverse effect on the functioning of the company mentioned in the auditor’s report shall be read before the company in general meeting and shall be open to inspection by any member of the company.

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3# Remuneration of Audit

Section 142 of Companies Act, 2013 The remuneration of the auditor of a company shall be fixed in its general meeting. Board of director shall mutually decide audit remuneration ( Audit fees ).

 

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OPC Statutory Audit

Statutory Audit is Mandatory for One Person Company. Company shall appoint Chartered Accountant from as an auditor of company.  Board of director of company is responsible to maintain books of accounts of Company. Auditor shall verify books of account and issue Statutory Audit Report. OPC shall maintain its books of account at its registered office.  Mandatory rotation of auditor after expiry of maximum term is not applicable. OPC Statutory audit is applicable for every Financial year. Cash flow statement is not a mandatory part of financial statements for a One Person Company. Copy of Financial Statement ( Balance sheet, Profit and loss account, Directors Report, Auditors Report, Notes of accounts) is to be attached while Filing e-form AOC-4.

Read : 7 Annual Compliance for OPC

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OPC Statutory Audit Check List

OPC Statutory audit is in-depth examination of books of accounts of company. Auditor shall conduct audit annually and submit audit report. The authority examines all the financial transactions and account balances which contributes in making the final report by the statutory auditing information. Below is quick audit check list for OPC company.

1. Opening balance verification
2. Cash Book Vouching
3. Bank Book Vouching
4. Bank Reconciliation
5. Purchases Vouching
6. Sales Vouching
7. Check Depreciation calculations
8. Check preliminary expenses calculations
9. Verify books of accounts

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ROC Compliances After OPC Audit       

After OPC Statutory Audit is completed, Auditor issues the Statutory Audit report. The Audit Report is attached to the financial statements of the company and financial statement also includes Balance sheet, Profit and loss Account, Directors Report, Notes to Accounts and Notice (if AGM is conducted) and these are mandatory attachments while filing e-form AOC-4. An OPC is required to comply the annual filling within the due dates to avoid heavy Penalty.

Read : OPC Income Tax Return Filing 

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Non-Filing Of Form AOC 4 And Form MGT-7

Penalty for Form AOC-4: A penalty of Rs 100 per day on delay in filing Form AOC. Apart from that, the penalty of Rs. 1000 per day of default is charged from the company which can go maximum up to Rs. 10,00,000.

Penalty for Form MGT-7: A penalty of Rs 100 per day is charged by the companies. Each member of the company and who is in default shall be deemed for paying the penalty of Rs. 50,000 and also the late fee of Rs. 100 per day if the default continues. The Penalty is subject to a maximum of Rs. 5,00,000.

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