GST Audit Training session conducted at Bombay Chartered Accountants Society on 4th January 2019.

1. January 6, 2019
AUDIT
Presented by : Dnyanesh Patade
Mentor for the Session : CA Jigar Shah

2. Disclaimer
This presentation has been prepared to provide a standard ‘user presentation’. The views
expressed in this presentation are those of Speaker(s). The Bombay Chartered Accountants
Society may not necessarily subscribe to the views expressed by the speaker(s).
The information cited in this presentation has been drawn from various sources. While
every efforts have been made to keep the information cited in this presentation error free,
BCAS do not take the responsibility for any typographical or clerical error which may have
crept in while compiling the information provided in this presentation. Further, the
information provided in this presentation are subject to the provisions contained under
different acts and members are advised to refer to those relevant provision also.
January 6, 2019 1

3. Topics for Today
➢ GST Audit – FAQs
➢ GST Audit Report
➢ GST Audit - Checklist
➢ Form GSTR 9C – Detailed Analysis
2January 6, 2019

4. 3
GST Audit - FAQs
January 6, 2019

5. Approach to GST Audit???
“Audit”
Vs
Reconciliation
4January 6, 2019

6. 1) What is Audit Under GST?
Section 2 (13) of CGST Act
“audit means the examination of records, returns and other documents maintained
or furnished by the registered person under this Act or the rules made thereunder or
under any other law for the time being in force to verify
the –
correctness of turnover declared,
taxes paid,
refund claimed and
input tax credit availed, and
to assess his compliance with the provisions of this Act or the rules made
there under.”
5January 6, 2019

7. Books of Accounts to be maintained under GST-
35. (1) Every registered person shall keep and maintain, at his principal place of
business,
as mentioned in the certificate of registration, a true and correct account of—
(a) production or manufacture of goods;
(b) inward and outward supply of goods or services or both;
(c) stock of goods;
(d) input tax credit availed;
(e) output tax payable and paid; and
(f) such other particulars as may be prescribed:
6January 6, 2019

8. Requirement of Registration-
Section 44(2) Every registered person who is required to get his accounts audited in
accordance with the provisions of sub-section (5) of section 35 shall furnish,
electronically, the annual return under sub-section (1) along with a copy of the audited
annual accounts and a reconciliation statement,
reconciling the value of supplies declared in the return furnished for the financial year
with the audited annual financial statement,
and such other particulars as may be prescribed.
7January 6, 2019

9. 1) Who is required to get book of accounts audited?
In terms of section 35(5) “every registered person whose turnover during a financial
year exceeds the prescribed limit shall get his accounts audited by a chartered
accountant or a cost accountant and shall submit a copy of the audited annual
accounts, the reconciliation statement under sub-section (2) of section 44 and such
other documents in such form and manner as may be prescribed”.
In terms of Rule 80(3) of the CGST Rules “every registered person whose aggregate
turnover during a financial year exceeds two crore rupees shall get his accounts
audited as specified under sub-section (5) of section 35 and he shall furnish a copy of
the audited annual accounts and a reconciliation statement, duly certified, in GSTR 9C,
electronically through the common
8January 6, 2019

10. QUESTIONS:
1) If XYZ Ltd has two units one in Maharashtra which has turnover of Rs. 3 Crores and one
in Gujarat which has turnover of Rs. 1.5 Crores whether it is required to get GST Audit
done in Gujarat?
2) ABC Ltd’s turnover from April-June 2017 is Rs. 35 Lakhs and from the period July 2017 –
March 2018 is Rs. 170 Lakhs whether it is required to get GST Audit done for FY 2017-18
3) Whether GST Annual Return is to be filed by those who have cancelled their registration
in FY 2017-18?
4) If total turnover of ABC ltd is Rs.190 Lakhs, however branch transfer amounts to Rs. 20
lakhs. Whether it is required to get GST audit done if :
a) Both the Branches are in Maharashtra?
b) If One is not Maharashtra and other in Gujarat?
9January 6, 2019

11. GST Audit Report
10January 6, 2019

12. Particulars Financial statements auditor & GST audit is same Financial statements Auditor & GST Auditor is different
Audit
of
Books
of
Accounts
(BOA)
I/we have examined the-
(a) balance sheet as on ………
(b) the *profit and loss account/income and
expenditure account for the period beginning
from ………..…to ending on ……., and
(c) the cash flow statement for the period beginning
from ……..…to ending on ………, -
attached herewith, of M/s …………… (Name),
…………………….………… (Address),
..…………………(GSTIN).
*I/we report that the audit of the books of accounts and the financial
statements of M/s.
………...........…………………. (Name and address of the assessee with
GSTIN) was
conducted by M/s. …………………………………………..………. (full name and
address of
auditor along with status), bearing membership number in pursuance
of the provisions of the
…………………………….Act, and *I/we annex hereto a copy of their audit
report dated
……………………………. along with a copy of each of :-
(a) balance sheet as on ………
(b) the *profit and loss account/income and expenditure account for
the period beginning
from ………..…to ending on …….,
(c) the cash flow statement for the period beginning from ……..…to
ending on ………, and
(d) documents declared by the said Act to be part of, or annexed to,
the *profit and loss
account/income and expenditure account and balance sheet.
Comparison statutory auditor vs only GST auditor
11January 6, 2019

13. Particulars Financial statements auditor & GST audit is same Financial statements Auditor & GST Auditor is
different
Certification
of Financial
Statements
3. (b) *I/we further report that, -
(A) *I/we have obtained all the information and explanations which,
to the best of *my/our
knowledge and belief, were necessary for the purpose of the audit/
information and
explanations which, to the best of *my/our knowledge and belief,
were necessary for the
purpose of the audit were not provided/partially provided to us.
(B) In *my/our opinion, proper books of account *have/have not
been kept by the registered
person so far as appears from*my/ our examination of the books.
(C) I/we certify that the balance sheet, the *profit and loss/income
and expenditure account
and the cash flow Statement are *in agreement/not in agreement
with the books of
account maintained at the Principal place of business at
……………………and
**…………………… additional place of business within the State.
NA
Comparison statutory auditor vs only GST auditor
12January 6, 2019

14. Particulars Financial statements auditor & GST audit is same Financial statements Auditor & GST Auditor is different
Opinion In my/our opinion and to the best of my/our
information and according to explanations given to
me/us, the particulars given in the said Form No.9C are
true and correct subject to the following
observations/qualifications, if any:
In my/our opinion and to the best of my/our information and
according to examination of books of account including other
relevant documents and explanations given to me/us, the
particulars given in the said Form No.9C are true and correct
subject to the following observations/qualifications, if any:
Comparison statutory auditor vs only GST auditor
13January 6, 2019

15. Audit Checklist
14January 6, 2019

16. Scoping-
● Audit Vs Preparation
● Sampling Methodology
● Approach: Diagnostic
Review Vs Audit
Resources:
● Trainings, Roles and
Responsibilities
● Tax Positions
Delivering:
● Working Files
● Reconciliation Reasons
● MRL
Preparing Client-
● Conduct Walkthrough
and Draw Audit Plan
● Identification of Data
Points
● Enabling System Access
Documentation:
● Registration Certificates
● Returns Filed
● Reconciliation of Client
Registers
● Credit Ledgers/Cash
Ledgers
● Refund Applications
● Agreements and Tax
Documents
● Other Submissions : LUT
Applications
● Liability Related Records,
ITC Ledgers, Import
Records, etc.
● GSTR 2A Reco
● Tax Positions: Legal
Opinions,
Implementation Study,
Anti Profiteering, etc.
● Litigation Review
15January 6, 2019

17. GSTR 9C: Reconciliation Statement
16January 6, 2019
Question : Is it really required ????

18. Sr No. GSTR 9C Description
1. Part I Basic Details
2. Part II Reconciliation of turnover declared in audited Annual Financial
Statement with turnover declared in Annual Return (GSTR9).
3. Part III Reconciliation of tax paid.
4. Part IV Reconciliation of Input Tax Credit (ITC).
5. Part V Auditor's recommendation on additional Liability due to non-
reconciliation.
GSTR 9C at a Glance
17January 6, 2019

19. Various Reconciliations in 9C
Part A- Output Related
1) Reconciling Gross Turnover with Turnover as per GSTR 9.
2) Reconciling Taxable Turnover with Taxable Turnover as per GSTR 9.
3) Reconciliation of Tax Paid rate wise
Part B- Input Related
1) Reconciliation of ITC as per books with GSTR 9.
2) Reconciling Break Up of ITC head-wise with GSTR 9
18January 6, 2019

20. PART I: BASIC DETAILS
19January 6, 2019

21. Cont. Next page
20January 6, 2019
GST Billing on
21st April
1st April 31st March21st April21st March

22. Cont. Next Page
21January 6, 2019
(-)

23. Cont. Next Page
22January 6, 2019
(+)

24. Cont. Next Page
23January 6, 2019
GSTR 9: 5N, 10 & 11

25. GST9 Table 4
24January 6, 2019

26. GSTR 9: Table 9, 10 & 11.
Part III : Reconciliation of tax paid.
25January 6, 2019

27. GSTR 9: Table 7J
Part IV : Reconciliation of Input Tax Credit (ITC).
Cont. Next Page
26January 6, 2019

28. 27January 6, 2019

29. 28January 6, 2019

30. Part V : Auditor's recommendation on additional Liability due to non-reconciliation.
29January 6, 2019

31. Verification:
I hereby solemnly affirm and declare that the information given herein above is true and correct to the best of my
knowledge and belief and nothing has been concealed there from.
(Signature and stamp/Seal of the Auditor)
Place: ……………
Name of the signatory …………………
Membership No………………
Date: ……………
Full address ………………………
Verification of registered person:
I hereby solemnly affirm and declare that I am uploading the reconciliation statement in FORM GSTR-9C prepared and
duly signed by the Auditor and nothing has been tampered or altered by me in the statement. I am also uploading
other statements, as applicable, including financial statement, profit and loss account and balance sheet etc.
Signature
Place: Name of Authorized Signatory
Date: Designation/status
30January 6, 2019

32. Q & A
31January 6, 2019

33. 32
1. Link to Audit Checklist.
2. Link to Management Representation letter.
3. Link to GSTR 9 excel.
4. Link to GSTR 9C excel.
Important Link
January 6, 2019

34. January 6, 2019

35. January 6, 2019