What Is Internal Audit?

Startupmates places a strong emphasis on internal audit as a pivotal risk management mechanism. Conducted independently, this process aims to enhance the efficiency of the entity by evaluating the operating effectiveness of internal controls. The objective is to ensure the integrity and probity of operations within the organization. With a commitment to excellence, Startupmates delivers top-notch internal audit services, focused on adding value to your organization. Our approach is geared towards strengthening existing controls and empowering your managers with enhanced risk management capabilities.

Why Internal Audit

Internal Audits serve as a robust tool to address organizational inefficiencies and streamline mismanaged activities. Here are various reasons for conducting an internal audit tailored for Startupmates:

Key Requirements:

  1. Verification of the books of accounts in compliance with applicable accounting standards.
  2. Evaluation of the effectiveness of internal controls implemented within the organization.
  3. Monitoring the implementation of policies and procedures.
  4. Facilitating the functioning of various departments by providing a clear picture of goals and objectives.
  5. Establishing a monitoring mechanism on employees and managers.
  6. Identification and prevention of potential frauds and scams.

Who is required to undergo Internal Audit?

In accordance with Section 138 of the Companies Act, 2013, Startupmates falls under the mandatory requirement for internal audit if it meets any of the following criteria:

  1. Share Capital of INR 50 crores and above
  2. Turnover of INR 200 crores and more
  3. Loans and Borrowings of INR 100 crores and above Shareholders cannot claim any of the company’s assets as long as the firm remains operational.
  4. Outstanding deposits of INR 25 crores

 

Not all the companies are required to undergo the applicability of internal audit. The Companies Act, 2013, sheds light on this, and the key lies in Rule 13 of The Companies (Accounts) Rules, 2014.

So, following are the class of companies which are required to appoint internal auditor –

(a) Every Listed company.

(b) Every Unlisted company having:-

 

(i) paid up share capital of fifty crore rupees or more during the preceding financial year;
or
(ii) turnover of two hundred crore rupees or more during the preceding financial year;
or
(iii) outstanding loans or borrowings from banks or public financial institutions exceeding one hundred crore rupees or more at any point of time during the preceding financial year;
or
(iv) outstanding deposits of twenty-five crore rupees or more at any point of time during the preceding financial year;

 

(c) every private company having-

 

(i) turnover of two hundred crore rupees or more during the preceding financial year;
or
(ii) outstanding loans or borrowings from bank or public financial institutions exceeding one hundred crore rupees or more at any point of time during the preceding financial year.

 

It is essential to note that internal audit should not be perceived merely as a statutory liability; rather, it is a valuable tool for organizations aiming to enhance their internal controls.

What Startupmates Offers?

At Startupmates, we present a dedicated team of experts and professionals to provide you with the assurance required for your company concerning tax, compliance, and transaction-related services. We take great pride in the exceptional services we offer and the recognition we have earned over our years of operation.

Under our assurance function, we cover:

  1. Internal Controls Review.
  2. Risk Assessment and Consulting.
  3. Statement of Procedure (SOP) Drafting.
  4. Operation-wise Internal Audits.
  5. Enterprise and Technical Risk Advisory.