TAX AUDIT

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Clause 17 (k) particulars of any liability of a contingent nature Liability crystallized, though the valuation thereof depends on a future event or quantification cannot be done with certain degree of accuracy - is not a contingent liability. e.g leave encashment, provision for warranty etc. Liability not crystallized. Provision made based on the relevant Accounting Standard or the Accounting Policy adopted -it is contingent liability- e.g. provision for diminution in value of investment. Understand the basis of making provision. Verify the provision relating to disputed claims Scrutinize various account heads such as of outstanding liabilities, provisions, etc. KALYANIWALLA & MISTRY
Clause 17 (l) amount of deduction inadmissible in terms of section 14A in respect of the expenditure incurred in relation to income which does not form part of the total income Any expenditure incurred for earning income which is exempt from tax shall not allowed as a deduction. Having regard to the accounts of the assessee, if the auditor can identify the expenses incurred – the same be stated in this clause. When there is no direct nexus or it is not possible to identify expenditure incurred for earning exempt income by applying any reasonable method – mix bag of funds – then disallowance be computed by applying Rule 8D KALYANIWALLA & MISTRY
Page 1 and 2: CLAUSE - 12A to 21, 25 to 27 KALYAN
Page 3 and 4: Clause 13 Amounts not credited to
Page 5 and 6: Clause 13 (d) any other item of inc
Page 7 and 8: Clause 14 Any interest paid on mon
Page 9 and 10: Clause 16 (a) Any sum paid to an em
Page 11 and 12: Clause 17 Amounts debited to the p
Page 13 and 14: Clause 17 (d) expenditure incurred
Page 15 and 16: Clause 17 If the tax is deducted an
Page 17 and 18: Clause 17 (g) interest, salary, bon
Page 19: Clause 17 (i) provision for payment
Page 23 and 24: Clause 17A Amount of interest inad
Page 25 and 26: Clause 19 Amounts deemed to be pro
Page 27 and 28: Clause 21 In respect of any sum re
Page 29 and 30: Clause 25 Details of brought forwa
Page 31 and 32: Clause 26 Section-wise details of
Page 33 and 34: Clause 27 Tax not deducted at all

TAX AUDIT

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