Finance & Compliance
Statutory Audit Coordination for Group Companies in India: A Planning Guide
By ATTPL HOLDCO / ATTPL GROUP Editorial Team · · 2 min read
How a business group can plan statutory audits across companies: auditor appointment, timelines, consolidation access, audit trail, CARO and a shared PBC list.
Why coordination matters in a group
Every company in India must have its accounts audited by a statutory auditor every year. In a group, the holding company's audit and consolidation depend on the subsidiaries finishing on time. If one subsidiary is late, the board meeting, AGM and filings of the whole group can slip. A coordinated plan saves time, reduces audit queries and gives the board confidence in the numbers.
It works best alongside a clear compliance calendar for multi-entity groups.
Key legal points to plan around
- Section 139 of the Companies Act, 2013 covers appointment of auditors, generally for a term of five years, with rotation rules for listed and prescribed classes of companies
- Section 143 sets the auditor's powers and duties; the holding company's auditor has a right of access to the records of subsidiaries as far as needed for consolidation
- Section 129(3) requires a company with subsidiaries, associates or joint ventures to prepare consolidated financial statements
- The Companies (Auditor's Report) Order, 2020 (CARO) applies to many companies, with exemptions such as for small companies and one person companies
- Accounting software must keep an audit trail (edit log) that cannot be disabled, as required under the Companies (Accounts) Rules from 1 April 2023
- The AGM is generally due within six months of the year end, with financial statements filed in AOC-4 within 30 days of the AGM
Check the latest notifications and the exact applicability for each company with your auditor or company secretary.
Build a group audit calendar
Work backwards from the holding company's board meeting. Fix dates for subsidiaries' trial balances, intercompany reconciliation, auditor fieldwork, draft accounts and sign-off. Close intercompany balances first, because mismatches are the most common cause of consolidation delay. Our guides on intra-group services and cost sharing and intra-group loans explain the documents auditors usually ask for.
Use one PBC list for all companies
A 'prepared by client' list sets out every schedule the auditor needs. Use one template for every group company so finance teams know the standard:
- Trial balance mapped to the group chart of accounts
- Bank, loan and intercompany confirmations
- Fixed asset register and depreciation workings
- Statutory dues: GST, TDS, PF and ESI payments and returns
- Related-party transactions list with approvals
- Board and shareholder minutes and statutory registers
After the audit
Hold a short debrief with each auditor. Track management letter points in one register with owners and dates, and share common findings across companies so the same issue does not repeat. Feed the results into the internal audit plan for the next year.
How ATTPL can help
ATTPL Consultancy supports accounting, ROC and compliance processes, and ATTPL Finance covers finance-related services. To discuss audit readiness for your group, contact ATTPL HOLDCO.
Frequently asked questions
Can all group companies appoint the same auditor?
Yes, subject to eligibility, independence and limits on the number of audits under the Companies Act. Many groups use one firm for consistency.
Does CARO 2020 apply to every company?
No. Some classes, such as small companies and one person companies, are exempt, and certain private companies are exempt if they meet prescribed conditions.
What is the audit trail requirement?
Since 1 April 2023, companies using accounting software must use software that records an edit log of every change, which cannot be disabled.
Sources and further reading
This article is general information, not legal, tax or audit advice. Requirements depend on each company's class and size; consult your statutory auditor or company secretary.
