Accounting Software program with Edit Logs for use from April 1

The Ministry of Corporate Affairs (MCA) by means of three notifications had notified that each firm utilizing accounting software program should use software program that information an audit path of each transaction and creates an edit log of every change made within the books of account. The software program should additionally be certain that the audit path can’t be disabled.

The Ministry of Company Affairs (MCA) issued the three notifications, No. G.S.R. 205(E) dated 24.03.2021, G.S.R. 247(E) dated 01.04.2021 & G.S.R. 235(E) dated 31.03.2022, concerning using accounting software program by firms for sustaining their books of account.

By the notification dated March 31, 2022, within the proviso to sub-rule (1) of rule 3, for the figures, letters and phrases “1st day of April, 2022”, the figures, letters and phrases “1st day of April, 2023” was substituted. In brief, shifting the efficient date of implementation of the identical to 1st April of this 12 months.

In keeping with the notifications, each firm utilizing accounting software program should use software program that information an audit path of each transaction and creates an edit log of every change made within the books of account. The software program should additionally be certain that the audit path can’t be disabled.

In response to the notifications, auditors have commented that the path ought to embrace deleted transactions as effectively. They’ve additionally said that they should amend their audit applications and inside management checks accordingly. If any deviation is discovered, it must be reported of their reporting.

These notifications are geared toward making certain transparency and accountability within the monetary sector. The usage of accounting software program with audit path options will assist stop monetary fraud and be certain that firms are sustaining correct information.

The provisions make a serious modification to the Companies (Accounts) Guidelines, 2014. The stakeholders are requested emigrate to or be certain that the accounting software program utilized by the corporate meets the above necessities with impact from April 1, 2023.

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