Is statutory audit mandatory for private limited companies even with zero turnover?

Yes. Statutory audit is mandatory for every company registered in India under Section 139 of the Companies Act 2013, regardless of turnover, profit, or operational status. Even a newly incorporated company with zero transactions must appoint a statutory auditor and have its accounts audited. There is no turnover exemption for companies.

Who appoints the statutory auditor of a company in India?

For the first auditor, the Board of Directors appoints within 30 days of incorporation per Section 139(6). If Board fails, shareholders appoint at EGM within 90 days. Subsequent auditors are appointed by shareholders at AGM for a 5-year term (individual) or 10-year term (firm). Form ADT-1 must be filed with ROC within 15 days.

What is the penalty for not conducting statutory audit in India?

Under Section 147 of the Companies Act 2013, the company faces a fine of INR 25,000 to INR 5,00,000. Officers in default face imprisonment up to 1 year, or fine of INR 10,000 to INR 1,00,000, or both. Directors may also face disqualification for continued non-compliance.

What is auditor rotation and does it apply to my company?

Auditor rotation under Section 139(2) applies to listed companies and prescribed unlisted public companies. Individual auditors cannot serve more than 5 consecutive years; audit firms cannot serve more than 10 consecutive years. After maximum term, a 5-year cooling-off period applies. Most private limited companies are exempt.

What is CARO 2020 and does it apply to my company?

CARO 2020 requires statutory auditors to report on specific matters including fixed assets, inventory, loans, statutory dues, and fraud. It does NOT apply to OPCs, small companies, and private companies where paid-up capital plus reserves do not exceed INR 1 crore, borrowings do not exceed INR 1 crore, and revenue is below INR 10 crore.

What is the deadline for statutory audit and filing with ROC?

AGM must be held within 6 months of financial year end (by 30 September for March year-end). Form AOC-4 (audited financials) must be filed with ROC within 30 days of AGM (typically by 30 October). Late AOC-4 filing attracts INR 100 per day per document.

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Mandatory for All Companies: Required under Section 139, Companies Act 2013 for every company registered in India - regardless of turnover, profit, or size

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End-to-End Service: Audit execution, CARO 2020 reporting, ADT-1 appointment filing, and AOC-4 financial statement filing with ROC

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Statutory Audit Service - Overview

📌 TL;DR - Statutory Audit Services at a Glance

Statutory audit is mandatory for every company registered in India under Section 139, Companies Act 2013 - there is no turnover exemption for companies. The auditor must be a practicing Chartered Accountant or CA firm. Penalties for non-compliance range from INR 25,000 to INR 5,00,000 for the company under Section 147. The audit must be completed before the AGM, and audited financials filed via Form AOC-4 with ROC within 30 days of the AGM.

Statutory audit is the legally mandated examination of a company's financial statements and accounting records to ensure they present a true and fair view of the company's financial position. Under Section 139 of the Companies Act 2013, every company incorporated in India - private limited, public limited, One Person Company, or listed entity - must appoint a statutory auditor and have its accounts audited annually.

Patron Accounting's statutory audit team conducts ICAI SA-compliant audits with complete transparency, timely delivery, and UDIN-verified reports that satisfy MCA, ROC, income tax authorities, and financial lenders. Our end-to-end service covers audit execution, CARO 2020 reporting, ADT-1 filing, and AOC-4 financial statement filing with ROC.

Content is reviewed quarterly for accuracy.

What is Statutory Audit?

Statutory audit is an independent examination of a company's financial records, transactions, and statements conducted by a qualified external Chartered Accountant, as required by statute. The objective is to determine whether the financial statements present a true and fair view of the company's financial position and comply with applicable accounting standards and the Companies Act 2013.

Unlike internal audit, which is conducted for management benefit, statutory audit is conducted for shareholders, regulators, and other stakeholders. The statutory auditor is appointed by shareholders at the Annual General Meeting (AGM) and reports to the members of the company, not to management.

The audit is governed by ICAI Standards on Auditing (SA) and, for listed and large companies, overseen by the National Financial Reporting Authority (NFRA).

Key Terms for Statutory Audit:

Statutory Audit vs Tax Audit - Statutory audit (Section 139, Companies Act 2013) is mandatory for all companies regardless of turnover. Tax audit (Section 44AB, Income Tax Act 1961) applies only above turnover thresholds. Both are distinct engagements with separate reports.

CARO 2020 - Companies Auditor's Report Order 2020 requires statutory auditors to report on specific matters including fixed assets, inventory, loans, statutory dues, and fraud. Does not apply to OPCs, small companies, and certain private companies.

UDIN - Unique Document Identification Number mandatory on every CA-signed statutory audit report. Verifiable by regulators and third parties.

ADT-1 - Form filed with ROC within 15 days of auditor appointment at AGM or Board meeting.

AOC-4 - Form for filing audited financial statements with ROC within 30 days of AGM.

Section 139 Companies Act 2013

Who Must Get a Statutory Audit Done?

All Companies Incorporated in India - No Turnover Exemption

Private Limited Companies - mandatory every financial year under Section 139
Public Limited Companies - mandatory every financial year
One Person Companies (OPC) - mandatory; auditor rotation rules do not apply
Listed Companies - mandatory; additional NFRA oversight and SEBI requirements
Dormant Companies - mandatory; even companies with zero transactions require annual audit
Foreign Company Subsidiaries in India - mandatory; Indian branch/subsidiary treated as Indian company

LLPs - Threshold-Based

Turnover exceeds INR 40 lakhs OR contribution exceeds INR 25 lakhs under Rule 24(1), LLP Rules 2009

Patron Accounting's Statutory Audit Services

Service	What We Do
Annual Statutory Audit	Complete annual audit of financial statements under Section 143, Companies Act 2013 including balance sheet, P&L, cash flow statement, resulting in signed audit report with UDIN
CARO 2020 Reporting	Detailed CARO 2020 report covering all applicable clauses - fixed assets, inventory, loans, investments, statutory dues, fraud, and other prescribed matters
First-Year Audit	Stub-period audit for newly incorporated companies; Board-appointed first auditor engagement; ADT-1 filing support within 30 days
Auditor Rotation Compliance	Identifying rotation requirements under Section 139(2); new auditor appointment process; handover management; ADT-1 filing
LLP Statutory Audit	Audit of LLP accounts under LLP Rules for partnerships with turnover above INR 40 lakh or contribution above INR 25 lakh
Ind AS Audit	Audit of financial statements prepared under Indian Accounting Standards for applicable companies; SEBI-regulated entity support

Our Process

7-Step Statutory Audit Process

From auditor appointment to AOC-4 filing. Section 139 requires written consent and eligibility certificate from auditor before appointment. Section 143(2) requires the report to be presented at AGM. AOC-4 must be filed with ROC within 30 days of AGM.

Step 1

Auditor Appointment and Engagement

The company appoints Patron Accounting as statutory auditor through Board resolution (first year) or shareholder resolution at AGM (subsequent years). Engagement letter signed defining scope, fees, and timelines. ADT-1 filed with ROC within 15 days.

ADT-1 filedEngagement signed

Appointed01

Step 2

Pre-Audit Planning

Risk assessment of the company's business, industry, and accounting systems. Detailed audit plan with high-risk areas, materiality thresholds, and sampling strategy per SA 300 and SA 320.

Risk assessedAudit plan ready

Plan Ready02

Step 3

Internal Control Assessment

Review of internal controls over financial reporting including account preparation processes, authorization procedures, and IT general controls per SA 315.

Controls reviewedGaps identified

Controls OK03

Step 4

Audit Fieldwork and Evidence Collection

Verify financial transactions, reconcile ledgers, confirm balances with third parties, physically verify fixed assets and inventory, examine contracts, test tax compliance (TDS, GST, PF, ESI), and review related party transactions.

Fieldwork completeEvidence collected

Verified04

Step 5

CARO 2020 Procedures

For applicable companies, specific procedures on all CARO 2020 reporting matters: loans, investments, deposits, statutory dues arrears, pending litigations, and fraud indicators.

CARO clauses checkedReporting complete

CARO Done05

Step 6

Draft Report and Management Representation

Draft audit report shared with management. Management Representation Letter obtained per SA 580. Significant matters discussed with Audit Committee or Board.

Draft reviewedMRL obtained

Approved06

Step 7

Final Audit Report with UDIN and AOC-4 Filing

Final audit report signed by partner, UDIN generated and embedded, report provided for AGM. Patron Accounting supports AOC-4 filing with ROC within 30 days of AGM.

UDIN generatedAOC-4 filed

Filed07

Documents Required for Statutory Audit

Document	Purpose
Trial balance, ledger accounts, schedules	Core financial data for the audit period
Prior year audited financial statements + audit report	Continuity verification and opening balance check
Bank statements + bank reconciliation	Cash and bank balance verification
Fixed asset register + depreciation schedules	Asset verification and depreciation testing
Inventory / stock register + valuation method	Inventory existence and valuation
GST returns (GSTR-1, GSTR-3B) + GST reconciliation	Revenue reconciliation with books
TDS challans + returns (24Q, 26Q) + Form 16A	Tax compliance verification
Loan agreements + outstanding loan schedules	Liability verification
Related party transactions list + approvals	Related party disclosure verification
Board meeting + General Meeting minutes	Corporate governance compliance
Debtors/creditors ageing + balance confirmations	Receivable/payable verification
Regulatory notices + pending legal matters	Contingent liability assessment

4 Common Statutory Audit Challenges and Solutions

Challenge	Impact	How Patron Accounting Solves It
Books of accounts not audit-ready at year-end	Audit delays and last-minute pressure	Pre-audit ledger review service offered 60 days before year end to identify and rectify gaps in advance
Late filing penalties for AOC-4 or AGM	INR 100/day additional fees + Section 147 penalties	Dedicated compliance calendar with advance reminders for AGM scheduling and AOC-4 filing deadlines
First-time statutory audit with no prior audit trail	Opening balance verification difficulty	Structured first-audit onboarding with opening balance verification, prior year reconciliation, and complete documentation
Multiple entity audits across financial year end	Resource allocation and deadline management	Multi-city team handles concurrent assignments - dedicated audit managers per entity for on-time delivery

Statutory Audit Fees in India 2026

Fee Component	Amount
Newly incorporated company (stub period)	INR 15,000 (below INR 1 crore turnover)
Small private limited company	INR 15,000 - INR 30,000 (below INR 1 crore)
Mid-size private limited company	INR 30,000 - INR 75,000 (INR 1-10 crore)
Growing private / public company	INR 75,000 - INR 2,00,000 (INR 10-50 crore)
Large company / listed entity	Custom quote (INR 50 crore+)
LLP statutory audit	INR 15,000 onwards (above threshold)
Ind AS audit (applicable companies)	Custom quote - premium engagement
Patron Accounting Professional Fees	Starting from INR 14,999 (Exl GST and Govt. Charges)

All fees and charges listed are indicative only and do not constitute a binding offer. Final amounts may vary depending on the volume of work and the complexity involved.

Professional service charges for drafting, filing, and representation are separate from the statutory fees. The exact fee depends on the complexity of the case, disputed amount, and number of hearings required. Contact us for a detailed quote.

Get a free Statutory Audit consultation - Call +91 945 945 6700 or WhatsApp us. No-obligation assessment.

How Long Does Statutory Audit Take?

Stage	Estimated Timeline
Newly incorporated / small company (low transactions)	5-10 business days
Mid-size private limited (INR 1-10 crore turnover)	2-4 weeks
Large company (INR 10-50 crore turnover)	4-8 weeks
Listed company / NFRA-applicable	6-12 weeks
LLP audit	5-10 business days
ADT-1 filing with ROC	1-2 business days after appointment
AOC-4 filing after audit completion	1-3 business days after report sign-off

Important: Engage Patron Accounting ideally 2-3 months before the AGM deadline. Early engagement ensures on-time delivery and avoids late filing penalties. AOC-4 must be filed within 30 days of AGM - late filing attracts INR 100 per day per document.

Key Benefits

Why Appoint Patron Accounting as Your Statutory Auditor?

Regulatory Compliance

Meet mandatory Section 139 requirements and avoid penalties under Section 147 (INR 25,000 to INR 5,00,000 for company; INR 10,000 to INR 1,00,000 for officer).

UDIN-Verified Reports

Every audit report carries valid UDIN, making it acceptable to MCA, income tax authorities, banks, investors, and ROC.

Timely Delivery

Structured engagement timelines ensure audit completion before AGM and AOC-4 filing within the 30-day ROC deadline.

CARO 2020 Expertise

Detailed CARO clause reporting with clear observations and no unnecessary qualifications on well-managed companies.

Cross-Industry Depth

Experience across manufacturing, IT/ITES, NBFC, retail, healthcare, construction, e-commerce, and NGO sectors.

Nationwide Service

CA teams in Pune, Mumbai, Delhi, and Bengaluru. Multi-entity coordination for groups with multiple Indian subsidiaries.

Why Businesses Trust Patron Accounting

Statutory Audit vs Tax Audit vs Internal Audit

Parameter	Statutory Audit	Tax Audit	Internal Audit
Governing Law	Section 139, Companies Act 2013	Section 44AB, Income Tax Act 1961	Section 138, Companies Act 2013
Mandatory For	ALL companies (no turnover limit)	Businesses above INR 1 Cr / Professionals above INR 50 lakh	Prescribed classes (turnover INR 200 Cr+)
Conducted By	Practicing CA / CA firm only	Practicing CA only	CA, CMA, or Board-approved professional
Reports To	Shareholders at AGM	Income Tax Department (portal)	Board / Audit Committee
Objective	True and fair view of financial statements	Verify tax compliance	Evaluate internal controls and risk
Filing Required	Form AOC-4 with ROC	Form 3CA/3CD with IT return	Report to Board (no ROC filing)
CARO Applicable	YES (for applicable companies)	NO	NO

Related Audit and Compliance Services

Tax Audit Services - mandatory under Section 44AB for businesses above turnover thresholds. Patron coordinates statutory and tax audit for Form 3CA/3CD delivery.
Internal Audit Services - mandatory under Section 138 for prescribed classes (turnover INR 200 Cr+ or borrowings INR 100 Cr+).
GST Audit Services - GST returns vs books reconciliation for GSTR-9C compliance.
Secretarial Audit Services - mandatory under Section 204 for listed and large unlisted companies.
Private Limited Company Compliance - year-round ROC compliance, annual filings, and board meeting support.

Legal Framework - Statutory Audit in India

Law / Rule	Section	Provision
Companies Act 2013	Section 139(1)	Every company to appoint an auditor at first AGM; term till conclusion of 6th AGM. Written consent and eligibility certificate required.
Companies Act 2013	Section 139(2)	Auditor rotation: individual max 5 consecutive years; firm max 10 years (2 x 5-year terms). 5-year cooling-off period.
Companies Act 2013	Section 139(6)	First auditor: Board within 30 days of incorporation. If Board fails, shareholders at EGM within 90 days.
Companies Act 2013	Section 141	Eligibility: only practicing CA or CA firm (majority partners practicing CAs). Independence requirements.
Companies Act 2013	Section 143	Powers and duties: access to all records, CARO 2020 reporting, fraud reporting to Central Government.
Companies Act 2013	Section 147(1)	Penalty for company: INR 25,000 to INR 5,00,000. Officer in default: imprisonment up to 1 year OR fine INR 10,000 to INR 1,00,000 OR both.
Companies Rules 2014	Rule 3	ADT-1 to be filed with ROC within 15 days of appointment at AGM or Board meeting.
CARO 2020	MCA Notification	Statutory auditors to report on fixed assets, inventory, loans, statutory dues, fraud for applicable companies.
ICAI SAs	SA 200-800 series	Standards on Auditing governing conduct, documentation, reporting, and ethics for statutory auditors.

External Authority Link: India Code - Companies Act 2013

Frequently Asked Questions About Statutory Audit

Get answers to the most common questions about mandatory statutory audit, auditor appointment, penalties, CARO 2020, and the audit process.

Quick Answers

What is statutory audit? Mandatory annual examination of a company's financial statements by an independent CA under Section 139, Companies Act 2013, to ensure they present a true and fair view.

Is it mandatory for all companies? Yes. Every company registered in India must conduct annual statutory audit, regardless of turnover, profit, or size.

What is the penalty? Section 147: INR 25,000 to INR 5,00,000 for company; officers face imprisonment up to 1 year or fine INR 10,000 to INR 1,00,000 or both.

Who can conduct it? Only a practicing CA or CA firm where majority of partners are practicing CAs - Section 141, Companies Act 2013.

AGM Deadline Approaching - Appoint Your Auditor Now

Key statutory audit deadlines for companies with April-March financial year:

30 days from incorporation: Board must appoint first statutory auditor; ADT-1 to be filed with ROC
30 September: AGM must be held (6 months from 31 March); statutory audit must be complete before AGM
Within 30 days of AGM (by ~30 October): Form AOC-4 to be filed with ROC
Within 15 days of AGM appointment: Form ADT-1 to be filed confirming auditor

Late AOC-4 filing attracts INR 100 per day. Failure to conduct statutory audit attracts Section 147 penalties of INR 25,000 to INR 5,00,000.

Call +91 945 945 6700 or WhatsApp us - contact Patron Accounting at least 2-3 months before your AGM.

Appoint Patron Accounting as Your Statutory Auditor - Starting at INR 14,999

Statutory audit is the foundation of financial credibility for every company in India. Whether you are a newly incorporated startup conducting your first audit, a growing mid-size company navigating CARO 2020 reporting, or a large entity managing auditor rotation compliance, the quality of your statutory audit directly affects your regulatory standing, investor confidence, and access to banking and credit.

Patron Accounting brings ICAI SA-compliant audit methodology, UDIN-verified reports, sector expertise, and a service model built around your deadlines. We go beyond sign-off - our engagement includes management letters, proactive ROC filing support, and advisory depth that transforms compliance into better governance.

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Statutory Audit Services Across India

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Content Created: March 2026 | Last Updated: | Next Review: April 2027 | Reviewed By: CA & CS Team, Patron Accounting LLP

This page is reviewed annually to reflect changes in Companies Act 2013 amendments, CARO notification updates, NFRA rules, ICAI SA revisions, and auditor rotation rule changes. Freshness Tier 2 - Annual Review.

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Real Stories from Real People

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Statutory Audit Service - Overview

What is Statutory Audit?

Who Must Get a Statutory Audit Done?

Patron Accounting's Statutory Audit Services

Auditor Appointment and Engagement

Pre-Audit Planning

Internal Control Assessment

Audit Fieldwork and Evidence Collection

CARO 2020 Procedures

Draft Report and Management Representation

Final Audit Report with UDIN and AOC-4 Filing

Documents Required for Statutory Audit

4 Common Statutory Audit Challenges and Solutions

Statutory Audit Fees in India 2026

How Long Does Statutory Audit Take?

Why Appoint Patron Accounting as Your Statutory Auditor?

Regulatory Compliance

UDIN-Verified Reports

Timely Delivery

CARO 2020 Expertise

Cross-Industry Depth

Nationwide Service

Why Businesses Trust Patron Accounting

Statutory Audit vs Tax Audit vs Internal Audit

Related Audit and Compliance Services

Legal Framework - Statutory Audit in India

Frequently Asked Questions About Statutory Audit

Is statutory audit mandatory for private limited companies even with zero turnover?

Who appoints the statutory auditor of a company in India?

What is the penalty for not conducting statutory audit in India?

What is auditor rotation and does it apply to my company?

What is CARO 2020 and does it apply to my company?

What is the deadline for statutory audit and filing with ROC?

Kya har private company ka statutory audit hona zaroori hai?

AGM Deadline Approaching - Appoint Your Auditor Now

Appoint Patron Accounting as Your Statutory Auditor - Starting at INR 14,999

Statutory Audit Services Across India