{"id":6246,"date":"2020-07-19T22:37:45","date_gmt":"2020-07-19T17:07:45","guid":{"rendered":"https:\/\/carajput.com\/blog\/?p=6246"},"modified":"2022-09-20T17:06:12","modified_gmt":"2022-09-20T11:36:12","slug":"new-requirements-including-in-caro-2020-reporting","status":"publish","type":"post","link":"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/","title":{"rendered":"New requirements including in CARO 2020 reporting"},"content":{"rendered":"<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_58 counter-hierarchy ez-toc-counter ez-toc-light-blue ez-toc-container-direction\">\n<p class=\"ez-toc-title\">Page Contents<\/p>\n<label for=\"ez-toc-cssicon-toggle-item-69dba87899ff3\" class=\"ez-toc-cssicon-toggle-label\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #000000;color:#000000\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #000000;color:#000000\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/label><input type=\"checkbox\"  id=\"ez-toc-cssicon-toggle-item-69dba87899ff3\"  aria-label=\"Toggle\" \/><nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#NEW_ADDITIONAL_REQUIREMENTS_INCLUDING_IN_THE_CARO_2020_REPORTING_AFTER_ON_CONSULTING_ON_WITH_THE_NFRA\" title=\"NEW ADDITIONAL REQUIREMENTS INCLUDING IN THE CARO 2020 REPORTING AFTER ON CONSULTING ON WITH THE NFRA\">NEW ADDITIONAL REQUIREMENTS INCLUDING IN THE CARO 2020 REPORTING AFTER ON CONSULTING ON WITH THE NFRA<\/a><ul class='ez-toc-list-level-3'><li class='ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Statutory_Auditors_Report_CARO_2020_shall_include_a_statement_a_New_Reporting_Requirements\" title=\"Statutory Auditor\u2019s Report (CARO 2020) shall include a statement a New Reporting Requirements\">Statutory Auditor\u2019s Report (CARO 2020) shall include a statement a New Reporting Requirements<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#The_statement_includes_a_Statutory_auditors_report_CARO_2020\" title=\"The statement includes a Statutory auditor\u2019s report (CARO 2020)\u00a0\">The statement includes a Statutory auditor\u2019s report (CARO 2020)\u00a0<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#CARO_2020_Applicability_on_which_of_the_Companies\" title=\"CARO 2020 Applicability on which of the Companies.\">CARO 2020 Applicability on which of the Companies.<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#The_Below_Private_Limited_Companies_are_also_exempt_from_CAROs_2020_requirements\" title=\"The Below Private Limited Companies are also exempt from CARO&#8217;s, 2020 requirements:\">The Below Private Limited Companies are also exempt from CARO&#8217;s, 2020 requirements:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#CARO_2020_Applicable_from_FY_2019-20-Changes_made\" title=\"CARO, 2020 (Applicable from FY 2019-20)-Changes made\">CARO, 2020 (Applicable from FY 2019-20)-Changes made<\/a><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Fixed_Assets_Property_Plant_and_Equipment\" title=\"Fixed Assets\/ Property, Plant, and Equipment \">Fixed Assets\/ Property, Plant, and Equipment <\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-8\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Inventory\" title=\"Inventory\">Inventory<\/a><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-9\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Undisclosed_Income\" title=\"Undisclosed Income:\">Undisclosed Income:<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-10\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Default_in_repayment_of_loans\" title=\"Default in repayment of loans \">Default in repayment of loans <\/a><ul class='ez-toc-list-level-4'><li class='ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-11\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Internal_Audit\" title=\"Internal Audit \">Internal Audit <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-12\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Consolidated_Financial_Statements\" title=\"Consolidated Financial Statements \">Consolidated Financial Statements <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-13\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Non-Banking_Financial_Activities\" title=\"Non-Banking Financial Activities \">Non-Banking Financial Activities <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-14\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Cash_Losses\" title=\"Cash Losses\">Cash Losses<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-15\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Financial_Ratios\" title=\"Financial Ratios \">Financial Ratios <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-16\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Corporate_Social_Responsibility\" title=\"Corporate Social Responsibility: \">Corporate Social Responsibility: <\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-17\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#APPLICABILITY_OF_ANNEXES_TO_THE_AUDITORS_REPORT\" title=\"APPLICABILITY OF ANNEXES TO THE AUDITOR&#8217;S REPORT:\">APPLICABILITY OF ANNEXES TO THE AUDITOR&#8217;S REPORT:<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-4'><a class=\"ez-toc-link ez-toc-heading-18\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#CONCLUSION\" title=\"CONCLUSION:\">CONCLUSION:<\/a><\/li><\/ul><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-19\" href=\"https:\/\/carajput.com\/blog\/new-requirements-including-in-caro-2020-reporting\/#Post_by_Rajput_Jain_Associates\" title=\"Post by Rajput Jain &amp; Associates \">Post by Rajput Jain &amp; Associates <\/a><\/li><\/ul><\/li><\/ul><\/nav><\/div>\n<p><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-8127\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/images.jpg\" alt=\"www.carajput.com; CARO2020\" width=\"808\" height=\"421\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/images.jpg 311w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/images-300x156.jpg 300w\" sizes=\"(max-width: 808px) 100vw, 808px\" \/><\/p>\n<h2><span class=\"ez-toc-section\" id=\"NEW_ADDITIONAL_REQUIREMENTS_INCLUDING_IN_THE_CARO_2020_REPORTING_AFTER_ON_CONSULTING_ON_WITH_THE_NFRA\"><\/span><span style=\"color: #ff9900;\"><strong>NEW ADDITIONAL REQUIREMENTS INCLUDING IN THE CARO 2020 REPORTING AFTER ON CONSULTING ON WITH THE NFRA<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h2>\n<h3><span class=\"ez-toc-section\" id=\"Statutory_Auditors_Report_CARO_2020_shall_include_a_statement_a_New_Reporting_Requirements\"><\/span><span style=\"color: #000080;\"><strong>Statutory Auditor\u2019s Report (CARO 2020) shall include a statement a New Reporting Requirements<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The existing COVID-19 pandemic affects not only public health but also the financial system as a whole. Public safety measures in place, although necessary are a huge hit to the economy&#8217;s liquidity flow leading to serious problems such as unemployment, a failure of the supply chain, a sudden drop in demand, unavailable inventories, etc.<\/p>\n<p>The government provides various relief and relaxation measures to boost businesses and the economy. In the same sense, the MCA has postponed from FY 2019-20 to FY 2020-21 the applicability of the<a href=\"https:\/\/carajput.com\/blog\/tag\/companies-act\/\"> Companies<\/a> (Auditor&#8217;s Report) Order, 2020 [CARO 2020].<\/p>\n<p><a href=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/04\/Appointment-of-Auditor.png\"><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-12288\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/04\/Appointment-of-Auditor.png\" alt=\"\" width=\"820\" height=\"410\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/04\/Appointment-of-Auditor.png 504w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2015\/04\/Appointment-of-Auditor-300x150.png 300w\" sizes=\"(max-width: 820px) 100vw, 820px\" \/><\/a><\/p>\n<h3><span class=\"ez-toc-section\" id=\"The_statement_includes_a_Statutory_auditors_report_CARO_2020\"><\/span><span style=\"color: #000080;\"><strong>The statement includes a Statutory auditor\u2019s report (CARO 2020)\u00a0<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>The Statutory auditor\u2019s report (CARO 2020) shall include the following statement on the below matters, which are mentioned below:<\/p>\n<p><a href=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/Image-caro.png\"><img loading=\"lazy\" decoding=\"async\" class=\"size-full wp-image-7685\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/Image-caro.png\" alt=\"www.carajput.com;CARO2020 Disclouser\" width=\"975\" height=\"488\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/Image-caro.png 975w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/Image-caro-300x150.png 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/Image-caro-768x384.png 768w\" sizes=\"(max-width: 975px) 100vw, 975px\" \/><\/a><\/p>\n<ul>\n<li>Registration U\/s 45-IA of RBI Act<\/li>\n<li>Total Cash losses information<\/li>\n<li>Information about the tangible and intangible assets<\/li>\n<li>Cost records Maintenance<\/li>\n<li>Total of statutory liabilities Deposit<\/li>\n<li>Completed unrecorded income which is required to be disclosed,<\/li>\n<li>Information of Default in repayment of borrowings<\/li>\n<li>Details of transfer to fund specified under Sch- VII of Co. Act<\/li>\n<li>Qualifications or adverse auditor remarks in other group companies<\/li>\n<li>Details of Compliance in respect of deposits accepted<\/li>\n<li>information of resignation of statutory auditors during the year<\/li>\n<li>any material uncertainty on meeting liabilities of the company.<\/li>\n<li>information of inventory and working capital<\/li>\n<li>complete details of investments, any guarantee or security or advances or loans given<\/li>\n<li>Compliance in respect of a loan to directors<\/li>\n<li>Funds raised and utilization<\/li>\n<li>Any pending Compliance by a Nidhi Company.<\/li>\n<li>Complete details Compliance on transactions with related parties<\/li>\n<li>Any Fraud &amp; whistle-blower complaints<\/li>\n<li>Implementation of Internal audit system<\/li>\n<li>Non-cash dealings with company directors<\/li>\n<\/ul>\n<p>In cases where the answer given by the Statutory auditor to any of the above requirements is unfavorable or negative, The auditor&#8217;s report shall then also set out the basis for such unfavorable or qualified response.<\/p>\n<p>In addition, in cases in which the auditor is unable to give an opinion on any defined issue, the report shall state such fact together with the purposes why the auditor can not give an opinion on the same.<\/p>\n<h3><span class=\"ez-toc-section\" id=\"CARO_2020_Applicability_on_which_of_the_Companies\"><\/span><span style=\"color: #000080;\"><strong>CARO 2020 Applicability on which of the Companies.<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>To improve the scope of the audit, the CARO 2020 was published by the MCA in consultation with the NFRA. It contains a list of topics that the relevant companies are obliged to report on.<\/p>\n<p>CARO 2020 applies to all \u00a0St. Audits beginning on or after 1 April 2020 which relates to the financial year 2019-20. The order applies to all companies covered under CARO 2016. Accordingly, the order requires all companies <strong>except<\/strong> the <strong>following companies which have been expressly prohibited from their jurisdiction:<\/strong><\/p>\n<ul>\n<li>Companies registered for charitable purposes<\/li>\n<li>Small companies (Companies with paid-up capital less than\/equal to Rs 50 lakh and with a last reported turnover which is less than\/equal to Rs 2 Cr)<\/li>\n<li>Insurance companies<\/li>\n<li>One person company<\/li>\n<li>Banking companies<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"The_Below_Private_Limited_Companies_are_also_exempt_from_CAROs_2020_requirements\"><\/span><span style=\"color: #000080;\"><strong>The Below Private Limited Companies are also exempt from CARO&#8217;s, 2020 requirements:<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<ul>\n<li>Whose gross receipts or revenue (including revenue from discontinuing operations) is less than or equal to Rs 10 Cr in the financial year<\/li>\n<li>Whose paid-up share capital plus reserves is less than or equal to Rs 1 CR as on the Balance sheet date (i.e. usually at the end of the financial year )<\/li>\n<li>Not a holding or subsidiary of a Public company<\/li>\n<li>Whose borrowings is less than or equal to Rs 1 Cr at any time during the financial year<\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"CARO_2020_Applicable_from_FY_2019-20-Changes_made\"><\/span><span style=\"color: #000080;\"><strong>CARO, 2020 (Applicable from FY 2019-20)-Changes made<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><a href=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/unnamed-2.jpg\"><img loading=\"lazy\" decoding=\"async\" class=\" wp-image-8126\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/unnamed-2.jpg\" alt=\"www.carajput.com; CARO2020\" width=\"827\" height=\"496\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/unnamed-2.jpg 512w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/unnamed-2-300x180.jpg 300w\" sizes=\"(max-width: 827px) 100vw, 827px\" \/><\/a><\/p>\n<ul>\n<li>\n<h4><span class=\"ez-toc-section\" id=\"Fixed_Assets_Property_Plant_and_Equipment\"><\/span><span style=\"color: #000080;\"><strong>Fixed Assets\/ Property, Plant, and Equipment <\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>Reporting over maintenance of records of Intangible assets has been specifically added.<\/p>\n<p>Leased Immovable property is specifically excluded from the reporting over the holding of title deeds in the Company\u2019s name. If owned Immovable property is not held in the Company\u2019s name, Dispute status and details of the registered owner need to be reported.<\/p>\n<p>In the case of EPP revaluation, the auditor must determine that the same has been achieved on the basis of the Reported Interest survey. Changes ought to be recorded if 10% or more of the adjustments are made in the WDV.<\/p>\n<ul>\n<li>\n<h3><span class=\"ez-toc-section\" id=\"Inventory\"><\/span><span style=\"color: #000080;\"><strong>Inventory<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<\/li>\n<\/ul>\n<p>Inconsistencies recognized by management with an effect of 10% or more of the inventory value need to be reported.<\/p>\n<p>In the case that the Corporation has a working capital limit of more than INR 5 Crores depending on the security of the current assets (e.g. Stock, Debtors), the auditor must report that the regular filings (e.g. Financial Accounts, Debtors Listing) made with the lender are in compliance with the books.<\/p>\n<ul>\n<li>\n<h4><span class=\"ez-toc-section\" id=\"Undisclosed_Income\"><\/span><span style=\"color: #000080;\"><strong>Undisclosed Income:<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>The auditor must disclose whether or not any income has been returned under the <a href=\"https:\/\/www.caindelhiindia.com\/blog\/corporate-professional-update-december-18-2015\/\">Income Tax Act, 1961<\/a> and the same has been duly accounted for in the books of accounts.<\/p>\n<ul>\n<li>\n<h3><span class=\"ez-toc-section\" id=\"Default_in_repayment_of_loans\"><\/span><span style=\"color: #000080;\"><strong>Default in repayment of loans <\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<\/li>\n<\/ul>\n<p>The auditor must determine that the company is considered to be a &#8220;Willful defaulter.&#8221;<\/p>\n<p>Information on the removal of term loans from allowable use needs to be published.<\/p>\n<p>Data has been given on how short-term loans have been used for long-term purposes.<\/p>\n<p>The auditor must comment on all money taken to meet the commitments of the community business.<\/p>\n<p>Reporting on loans received by the Firm was made on the basis of the commitment of shares issued by the Firm to shareholders, Joint ventures, and associates.<\/p>\n<ul>\n<li><span style=\"color: #000080;\"><strong>Fraud reporting <\/strong><\/span><\/li>\n<\/ul>\n<p>Fraud reporting has been extended to fraud against the Company by any person rather than by officers or employees in the past.<\/p>\n<p>The fraud report issued by the auditors in the form of ADT-4 to CG should be reported.<\/p>\n<p>The auditor has to record his evaluation of &#8220;Whistle Blower&#8221; allegations.<\/p>\n<ul>\n<li>\n<h4><span class=\"ez-toc-section\" id=\"Internal_Audit\"><\/span><a href=\"https:\/\/carajput.com\/services-internal-audits.php\"><strong>Internal Audit <\/strong><\/a><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>The auditor must report whether the internal audit system exists within the company and whether or not the internal audit reports have been considered.<\/p>\n<p>The particulars of the proceedings (pending\/initiated) under the Benami Law need to be published.<\/p>\n<ul>\n<li>\n<h4><span class=\"ez-toc-section\" id=\"Consolidated_Financial_Statements\"><\/span><span style=\"color: #000080;\"><strong>Consolidated Financial Statements <\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>Details of consolidated companies with qualifications or adverse reactions in the CARO report must be reported along with the Paragraph Number of the auditor with the audit report on Consolidated Financial Activities.<\/p>\n<ul>\n<li>\n<h4><span class=\"ez-toc-section\" id=\"Non-Banking_Financial_Activities\"><\/span><span style=\"color: #000080;\"><strong>Non-Banking Financial Activities <\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>The auditor must report on the conduct of financial activities of an NBFC nature by the company without valid Certificates and reporting.<\/p>\n<ul>\n<li>\n<h4><span class=\"ez-toc-section\" id=\"Cash_Losses\"><\/span><span style=\"color: #000080;\"><strong>Cash Losses<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>The auditor will document whether the Company has suffered CASH LOSS during the current AND preceding financial year and the volume of such cash loss.<\/p>\n<p>The resignation of the statutory auditor and the causes, problems with him duly considered by the incoming auditor or not; must be published.<\/p>\n<ul>\n<li>\n<h4><span class=\"ez-toc-section\" id=\"Financial_Ratios\"><\/span><span style=\"color: #000080;\"><strong>Financial Ratios <\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>The goals of the Organization to meet its Existing Obligations on the basis of percentages, maturity and plans for execution must be stated.<\/p>\n<ul>\n<li>\n<h4><span class=\"ez-toc-section\" id=\"Corporate_Social_Responsibility\"><\/span><span style=\"color: #000080;\"><strong>Corporate Social Responsibility: <\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<\/li>\n<\/ul>\n<p>The Auditor will disclose that the unexpended amount has been allocated to the designated fund within 6 months of the end of the fiscal year and whether or not the pending project balance has been moved to a special account. (Amendment itself under the Corporations Act, not yet told in 2013).<\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-23229\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_.jpg\" alt=\"CARO 2020 VS CARO 2016\" width=\"1755\" height=\"1240\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_.jpg 1755w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_-300x212.jpg 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_-1024x724.jpg 1024w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_-768x543.jpg 768w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_-1536x1085.jpg 1536w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_-800x565.jpg 800w\" sizes=\"(max-width: 1755px) 100vw, 1755px\" \/><\/p>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignnone size-full wp-image-23230\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_1.jpg\" alt=\"CARO 2020 VS CARO 2016\" width=\"1755\" height=\"1240\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_1.jpg 1755w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_1-300x212.jpg 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_1-1024x724.jpg 1024w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_1-768x543.jpg 768w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_1-1536x1085.jpg 1536w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_1-800x565.jpg 800w\" sizes=\"(max-width: 1755px) 100vw, 1755px\" \/><\/p>\n<h4><img loading=\"lazy\" decoding=\"async\" class=\"alignnone wp-image-23231\" src=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_2.jpg\" alt=\"CARO 2020 VS CARO 2016\" width=\"882\" height=\"623\" srcset=\"https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_2.jpg 1755w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_2-300x212.jpg 300w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_2-1024x724.jpg 1024w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_2-768x543.jpg 768w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_2-1536x1085.jpg 1536w, https:\/\/carajput.com\/blog\/wp-content\/uploads\/2020\/07\/CARO-2020-VS-CARO-2016_2-800x565.jpg 800w\" sizes=\"(max-width: 882px) 100vw, 882px\" \/><\/h4>\n<h4><span class=\"ez-toc-section\" id=\"APPLICABILITY_OF_ANNEXES_TO_THE_AUDITORS_REPORT\"><\/span><span style=\"color: #003366;\"><strong>APPLICABILITY OF ANNEXES TO THE AUDITOR&#8217;S REPORT:<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<ol>\n<li>Annexure of the CARO Report is not needed in the case of Small Business, Banking Firm, Insurance Company, Section 8 Company, One Person Company, and any <a href=\"https:\/\/carajput.com\/services\/private-limited-company-registration.php\">private company<\/a> having paid-up capital and free assets to INR 1 crores as at the balance sheet date and borrowing up to INR 1 crores at any time during the year and revenue up to INR 10 crores as per the financial reporting of the year mentioned.<\/li>\n<li>Annexure of the Internal Financial Control Report is not required in the case of Small Company, One Person Company, AND any Private Company with Turnover up to INR 50 Crores as per the financial statements of the year concerned and borrowing up to INR 25 Crores at any time during the year.<\/li>\n<\/ol>\n<h4><span class=\"ez-toc-section\" id=\"CONCLUSION\"><\/span><span style=\"color: #000080;\"><strong>CONCLUSION:<\/strong><\/span><span class=\"ez-toc-section-end\"><\/span><\/h4>\n<ul>\n<li>According to CARO 2020, disclosure is required as to whether any qualifications or adverse remarks have been made by the respective auditors in the CARO reports of the companies included in the consolidated financial statements, if yes, the company details and the CARO report sentence numbers usually contain the qualifications or adverse remarks should be noted.<\/li>\n<li>The CARO 2020 is supposed to substantially increase the overall standard of the audit reports on the company&#8217;s financial statements and thereby contribute to greater accountability and confidence in the company&#8217;s financial affairs. It is inevitably expected to increase the inflow of investment by and in Indian companies.<\/li>\n<li>In summary, we would like to say that the auditor&#8217;s reporting expectations are expanding substantially. Hoping this would lead to more public accountability between the company and its shareholders and hence the auditor needs to make sure he&#8217;s more perspective and especially while performing his duties.<\/li>\n<\/ul>\n<p><strong>Popular blog:-<\/strong><\/p>\n<ul>\n<li><a href=\"https:\/\/carajput.com\/learn\/audit-assurance-and-corporate-law-compliance-with-rules-and-regulations.html\">Rules and regulations of Audit and Assurance and corporate law compliance<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/archives\/tally-manual-for-tax-audit-report.pdf\" data-cke-saved-href=\"https:\/\/carajput.com\/archives\/tally-manual-for-tax-audit-report.pdf\">tally manual for tax audit report<\/a><\/li>\n<li><a href=\"https:\/\/carajput.com\/publications\/draft-observation-for-tax-auditor-in-case-of-tax-audit-and-draft-of.pdf\">Draft Audit Report as per SA- 700(revised) incorporating CARO-2020<\/a><\/li>\n<\/ul>\n<h3><span class=\"ez-toc-section\" id=\"Post_by_Rajput_Jain_Associates\"><\/span><em>Post by <a href=\"https:\/\/carajput.com\/\">Rajput Jain &amp; Associates <\/a><\/em><span class=\"ez-toc-section-end\"><\/span><\/h3>\n","protected":false},"excerpt":{"rendered":"<p>NEW ADDITIONAL REQUIREMENTS INCLUDING IN THE CARO 2020 REPORTING AFTER ON CONSULTING ON WITH THE NFRA Statutory Auditor\u2019s Report (CARO 2020) shall include a statement a New Reporting Requirements The existing COVID-19 pandemic affects not only public health but also the financial system as a whole. Public safety measures in place, although necessary are a &hellip;<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[34],"tags":[9166,9542,8719,9165,8711],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/6246"}],"collection":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/comments?post=6246"}],"version-history":[{"count":5,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/6246\/revisions"}],"predecessor-version":[{"id":23307,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/posts\/6246\/revisions\/23307"}],"wp:attachment":[{"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/media?parent=6246"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/categories?post=6246"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/carajput.com\/blog\/wp-json\/wp\/v2\/tags?post=6246"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}