A Brief summary of Scope of GST Audit:
AUDIT Check Points:
Review of GST Registration Certificate and Amendment of core and non-core fields application filed by the Assessee along with details of all additional place of business, whether the same are incorporated in the Registration Certificate.
Maintenance of Books of Accounts:
A) Reviewing,Whether a true and correct account of:
>Production or manufacture of goods
>Inward/Outward supply of Goods/Services
>Stock of goods
>Input tax credit availed/utilized
>Output tax payable and paid
>Goods or services imported or exported
>Supplies attracting RCM along with Relevant documents
>Advance Received & Paid along with Adjustments
>List of all Additional Place of Business &Other Warehouses has been maintained.
B) Whether the books of Accounts maintained are centralized or decentralized?
C) Whether the copies of all Agreements/Agent agreement and other supporting documents are obtained and properly maintained?
A) Review of documents such as:
>Tax Invoices/Bill of supply
>Delivery Challans/Dr. notes/Cr. Notes
>Receipt notes and
>Other relevant documents, issued as per GST law?
B) Whether it contains all the relevant particulars as required under law?
C) Whether Receipt voucher is issued for receipt of advance?
D) Whether Self-invoice and payment voucher is issued in case of RCM transactions under Section 9(4)?
E) Whether Credit note/Debit Note is issued before 30th September of the Subsequent Financial Year i.e. September 2018?
F) Whether bill of supply is issued for exempt supplies/ non- GST supplies?
- Whether the Principal has sent goods to the job worker under the cover of delivery challans?
- Whether the registered person has furnished FORM ITC 04 for the quarters in which goods were sent out for job work?
- Are there any transactions wherein the goods sent for job work not received back are treated as supply?
- Whether E-way Bill provisions related to job work are complied with?
- Whether the kind of outward supplies like Taxable supply, Exempted supply, Zero- rated supply,NIL rated supply, Supplies to SEZ unit / developers / Deemed Export and Merchant Export etc. are appropriately classified under GST law?
- Whether the supplies made by a registered person falls within the meaning of Composite/non- composite/ Mixed supply? If yes, whether the same has been offered to tax??
- Whether any transaction which falls within the scope of supply has not been identified by the Registered Person?
- Sale of capital goods and the GST charged and as to whether they are included in the returns filed?
- Whether the supplier has declared sale in course of Imports, Non- territory supply, High Sea supply in the Return correctly?
Input Tax Credit:
- Whether the Input Tax Credit has been availed with proper documentary evidences?
- Whether the payment to supplier, is made within 180 days from the date of invoice, if not, then ITC availed, has been reversed properly along with payment of interest?
- Review of import documents, job work inward invoices, stock transfer inward invoices,etc. Some of these may not be accounted in the system as they are not financial entries but have an impact on ITC.
- Review of discounts agreed and valuation adopted by vendors.
- Reversal of proportionate ITC in respect of exempted supplies, non-business purpose use.
- Review of ITC on supplies specifically blocked u/s 17.
- Review of TRAN-1, TRAN-2 filed.
- Where ITC is availed and then the goods lost,stolen, destroyed, written off or distributed as gifts/free samples, ITC has to be reversed with interest.
- Whether Proper mechanism/checklist to determine the eligibility of ITC of various purchase/procurement transactions is in place?
- Whether the classification of goods/ services is in conformity with Schedules /Notifications and proper HSN/SAC codes is been quoted by the company.
- Review of GST Returns filed by the company such as GSTR1, GSTR3B, ITC-04, whether the returns are filed timely in compliance of GST laws.
- Whether All the Supplies have been duly reported under proper head?
- Whether Output tax liability, ITC availed/utilized and offsetting thereof has been done in an appropriate manner.
- Interest and other dues has been duly charged and paid.
- Reconciling returns such as
>GSTR- 1 with GSTR3B.
>GSTR- 3B with books.
>GSTR-1 with Books.
>GSTR-2A with GSTR3B and simultaneously with books.
- Whether input tax credit as per GSTR-2A and as claimed in books is reconciled? If not, reasons thereof?
GST collections and payment verification:
- Whether the tax payable has been duly paid by company within the due date and if not, proper interest has been paid or not on the said amount.
Reverse charge Provisions:
- Whether Reverse charge tax is paid and Self invoicing rules complied under 9(4) of the CGST Act 2017 up to 12th October 2017?
- Whether Reverse charge tax on notified supplies under Section 9(3) and 9(5) of the GST Act 2017 is duly paid?
- Review of GST paid under reverse charge on goods/services and availing the credit for same.
- Review of compliance with respect to receipt of advances in case of outward supply of goods by registered persons having turnover less than Rs. 1.50 Cr. during last financial year have been made upto 12th October 2017.
- Review of compliance with respect to taxpayers having turnover more than Rs. 1.50 Cr.during last FY, whether GST has been paid on advance received on outward supply of Goods on advances received during the period 01/07/2017 to 14/11/2017.
- Review of advances received with respect to outward supply of services. Whether GST liability has been charged at time of receipt of advance itself?
- Review of Accounting and Documentation work of receipt vouchers and other relevant docs in respect of advances and adjustment thereof.
- Review of compliance with respect to e-way bill provisions.
- Whether effective controls are maintained and operated before issuing an e-way bill to avoid any financial or legal implications.
- Whether details mentioned in the e-way bill match with the details of sales or purchase invoice as the case may be.
- Whether the supplier has applied for Refund, if any, and whether it is sanctioned?
- Whether all the documents for refund are verified?
- Whether any erroneous refund has been claimed during the F.Y.?
- Whether the wrong payment of tax i.e. IGST in lieu of SGST/CGST is claimed as refund and vice versa?
- All other checks relating to Anti profiteering clause, conflicting Advance ruling orders if applicable or any huge or unusual inward or outward supply transactions / tax credits / tax payments etc.?