MCA extend the Audit Trail Applicability to 01-04-2023


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MCA has vide notification dated 31.03.2022 extends Implementation of Audit Trail software to financial year commencing on or after the April 1, 2023 and also extended CSR-2 due date till  May 31, 2022.

Extension of due date for filing form CSR-2

The MCA vide its notification dated 11th February, 2022 had introduced form CSR-2 by inserting sub-rule (1B) in rule 12 of the Companies (Accounts) Rules, 2014.

It was provided that for the preceding F.Y. (2020-21), form CSR-2 shall be filed on or before 31st March 2022, after filing form AOC-4. However, due to technical difficulties being faced by the stakeholders, the MCA has extended the due date by 2 months by notifying Companies (Accounts) Second Amendment Rules, 2022.

The extended due date for filing form CSR-2 for F.Y. 2020-21 is 31st May, 2022.

Applicability of provisions of Audit Trail

The MCA vide its notification dated 24th March, 2021 had introduced the concept of audit trails by inserting proviso to rule 3(1) of the Companies (Accounts) Rules, 2014.

It was provided that “for the F.Y. commencing on or after 1st April, 2021, every company which uses accounting software for maintaining its books of account, shall use only such accounting software which has a feature of recording audit trail of each and every transaction, creating an edit log of each change made in books of account along with the date when such changes were made and ensuring that the audit trail cannot be disabled.”

However, the applicability was deferred by 1 year by amending the same vide Companies (Accounts) Second Amendment Rules, 2021. The new date of applicability was 1st April, 2022.

Yet again, the MCA has amended the proviso vide Companies (Accounts) Second Amendment Rules, 2022 and has deferred the applicability by 1 more year. Hence the provision of audit trail is now applicable w.e.f. 1st April, 2023.


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