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Comprehensive Checklist for GST Audit

Comprehensive Checklist for GST Audit by CA Pragya Singh

As the year is ending, the date for filing the GSTR-9 and GSTR-9C is getting closer. The GSTR-9 is for annual return and GSTR-9C is for the audit report. So, let us know more about what should be checked for GSTR-9C(Audit Report). Following are the components of the Comprehensive Checklist for GST Audit:

Documents Llist:
Particulars Remark
Signed Financial Statements  
State wise financial statements  
GST User Id   
GST Password  
Monthly GSTR 3B  
Monthly GSTR 1  
Monthly GST Workings  
Monthly ITC reversal workings along with final reversal  
Transitional Credits Availed along with workings  
List of supplies along with HSN and rate adopted  
Refund Claim filed along with workings  
Refund Claim Orders received  
List of Advance Rulings applied  

 

Comprehensive Checklist for GST Audit:

S. No. Particulars
1. Understanding Of Client Business 
2. Registration
3. Supply
4. Documents Related To Supply
5. Place of supply
6. Reverse Charge
7. GST   Payments & Input Tax Credit
8. Job Work
9. Filing of Returns
10. Refund
11. Accounts & Records
12. Miscellaneous
13. Management Representation Letters

 

Download the Comprehensive Checklist on GST Audit bu CA Pragya Singh: Comprehensive Checklist on GST Audit

UNDERSTANDING OF CLIENT BUSINESS:
S.No.  Particulars Remarks
     
1 BASIC DATA   
a Name of the client  
b Constitution Type – Private, Public, Section 8  
c Registered Office   
d Branches / Warehouses / Factory address  
e Nature of Business  
h List of supply along with HSN and rate  
     
2 MANAGEMENT  
a Key Shareholders   
b Key Managerial Personnel ( KMP ) / Other Key officers of the Company   
c Directors and Constituion of the Board   
d Independent Directors and Committees of the Board   
e List of all Related Parties and nature of relationships   
     
3 INDUSTRY DYNAMICS   
a Industry in which the client operates  
b Seasonality / Trends in industry   
c Present state and prognosis for industry   
d Client state vs industry benchmarks   
e Key Competitiors  
f Key Suppliers   
g Key customers and marketing relationships   
     
4 ACCOUNTING SYSTEMS AND INTERNAL CONTROLS   
a Standard Operating Procedures  
b Delegation of Powers   
c IT enviroment in the entity   
d Financial Reporting protocols   
e Management Reporting protocols   

 

REGISTRATION
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Obtain the list of registrations in pre GST regime and ensure migration?        
2 Whether registration is obatined in every state from where supply is made ?        
3 Whether compulsory registration as required u/s. 24 of CGST Act is obtained?        
4 Whether the entity was registered as composition dealer at any time during the year?        
5 Whether additional places of business within a state are added in the registration certificate        
6 Whether registration for ISD has been obtained for transfer of ITC in respect of services        
7 Whether   GSTIN   is   displayed   in Name      Boards        

 

SUPPLY:
SUPPLY & CLASSIFICATION OF SUPPLY
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether classification of supplies into goods or service is as per Schedule II to the CGST Act?        
2 Whether any revenue is classified as not a supply? Provide reasons.        
3 Whether supply of goods are appropriately classified as per customs tariff?        
4 Whether supply of services are appropriately classified as per Annexure to Notification 11/2017 – CGST (Rate)?        
5 Whether rate for goods is as per the notification 1/2017 read with subsequent amendments?        
6 Whether rate for services is as per the notification 11/2017 read with subsequent amendments?        
7 Whether exemption in case of goods is claimed as per the notification 2/2017 read with subsequent amendments?        
8 Whether rate is as per the notification 12/2017 read with subsequent amendments?        
9 Whether conditions for export of service as per definition in IGST Act is complied?        
10 Whether conditions for export of goods as per definition in IGST Act is complied?        
11 Whether conditions of notification in case of deemed supply has been complied?        
12 Whether conditions of notification in case of supplies to Merchant Exporter has been complied?        
13 Whether  Composite and Mixed Supplies are appropriately taxed as per Section 8?        
14 Whether Tax on sale of capital goods has been discharged as per Section 18 and Rules made there under?        
15 Whether Supply falling under Schedule I of the CGST Act has been identified and tax has been paid?        
16 Whether change in tax rates has been dealt with correctly?        
17 Whether supply as per books of account matches with supply as per         

 

TIME OF SUPPLY
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether GST is paid on the basis of provisions of Section 12 & 13 of the CGST Act?        
2 Whether there was any change in the rate of tax and provisions of Section 14 of the CGST Act have been complied?        
3 Whether any goods were sent of approval basis and provisions of time of supply was compiled on the same?        
4 Whether any goods were sent on job work basis and not returned within prescribed time and provisions of time of supply was compiled on the same?        

 

VALUATION OF SUPPLY
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether  all  the  inclusions  and deductions as per Section 15 have been complied?        
2 Whether valuation is made as per valuation Rules of the CGST Rules?        

 

VERIFICATION WITH RETURNS
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether supplies as per books of account and GSTR 1 are same?        
2 If not same, whether reconciliation statement has been prepared?        
3 Whether in the reconciliation statement any items are there on which GST was payable during the year?        

 

DOCUMENTS RELATED TO SUPPLY
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether invoice has all the prescribed particulars as required under Section 31 and rules made there under?        
2 Whether bill of supply is issued for exempt supplies/      non-      GST supplies?        
3 Whether the time limit for issue of invoice has been adhered to?        
4 Whether Receipt voucher is issued for receipt of advance?        
5 Whether “Self Invoice” is raised in case of RCM transactions        
6 Whether  Credit  note/  Debit  notes are issued as per the provisions of the GST law as per Section 34?        
7 If Credit  note/  Debit  notes are not issued as per Section 34, then no tax is reversed?        
8 Whether   the   Delivery   challans are maintained?        

 

VERIFICATION WITH RETURNS
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether document as per books of accounts match with GSTR 1        

 

PLACE OF SUPPLY
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether inter state transactions are determined as per Section 7 of the IGST Act        
2 Whether intra state transactions are determined as per Section 8 of the IGST Act        
3 Whether the place of supply of goods in case of domestic supply has been determined as per Section 10 of the IGST Act         
4 Whether the place of supply of services in case of domestic supply has been determined as per Section 12 of the IGST Act         
5 Whether the place of supply of goods in case of international supply has been determined as per Section 11 of the IGST Act         
6 Whether the place of supply of services in case of international supply has been determined as per Section 13 of the IGST Act         
7 Whether the wrong payment of tax
i.e.  IGST  in  lieu  of  SGST/CGST  is claimed as refund?
       
8 Whether the wrong payment of tax
i.e.  SGST/CGST  in  lieu  of  IGST  is claimed as refund?
       

 

REVERSE CHARGE MECHANISM
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether Reverse Charge has been paid on all inward supplies notified u/s. 9(3) of the CGST Act and u/s. 5(3) of the IGST Act?        
2 Whether Reverse Charge has been paid u/s. 9(4) of the CGST Act and Section 5(3) of the IGST Act on supplies received from unregistered person until 12th October 2017        
3 Whether ITC has been availed of the tax paid under reverse charge?        

 

VERIFICATION WITH RETURNS
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether expenses on which RCM is payable reconciles with RCM as declared in GSTR 3B        

 

GST PAYMENTS
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether tax has been paid within the prescribed due dates?        
2 In case of late payments whether interest has been paid?        
3 Whether GST collected has been remitted or there is any excess collection?        

 

INPUT TAX CREDIT
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether input tax credit is taken based on eligible documents having all the prescribed particulars as per the Rules made in this regard?        
2 Whether the goods / services on which ITC is claimed has been received by the entity before taking ITC?        
3 Whether in case of purchase of capital goods, if ITC is claimed, ensure no depreciation is claimed?        
4 Whether the vendors (other than RCM) have been paid within 180 days from the date of invoice?        
5 Whether the entity supplies both taxable and exempt/non-GST supplies?

Whether ITC on common inputs and input service has been reversed as per Rule 42 of the CGST Rules?

       
6 Whether the entity supplies both taxable and exempt/non-GST supplies?

Whether ITC on common capital goods has been reversed as per Rule 43 of the CGST Rules?

       
7 Whether ITC has been taken on list of blocked credits u/s. 17(5)?        
8 Any Reversal of input tax credit for the goods sent for job work?        
9 Whether     Input     tax     credit     is reversed   against   the   receipt   of
Credit Note?
       
10 Whether the conditions for availing transitional credits have been fulfilled        
11 Whether any ITC has been claimed as per Section 18 and whether conditions of Section 18 and rules made there under have been satisfied?        
12 Whether wrong ITC availed has been reversed along with interest?        

 

INPUTSERVICE DISTRIBUTOR
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether ISD registration has been obtained?        
2 Whether conditions for transfer of ITC on input services has been satisfied?        
3 Whether the transfer of ITC is appropriately calculated as per the methods prescribed in law?        
4 Is there is any reversal of Input tax credit and credit note is issued?        
5 Whether invoice for ISD issued contains prescribed particulars?        

 

JOB WORK
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether goods sent on job work have been received within the prescirbed time?        
2 Whether the documents prescirbed for job work has been maintained?        
3 Whether FORM   ITC   04   has been filed quarterly?        

 

FILING OF RETURNS
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether returns as applicable have been filed within the due dates        
2 In case of late filing whether late fees has been paid?        
3 Whether late fees waived has been credited in cash ledger?        
4 Whether transitional credit Returns are filed within the due date?        
5 Whether any amendments/omission/ correction in returns has been made between April 2018 to September 2018?        

 

REFUNDS
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether the Supplier is eligible for Refund as per Section 54?        
2 Whether refund application has been made?        
3 Whether the calculation of refund is as per the Rules prescribed ?        
4 Whether refund order has been received or is rejected or pending ?        
5 Whether Refund rejected has bein Re-credited to Electronic Credit Ledger?        

 

VERIFICATION WITH RETURNS

S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether the Returns filed for refund have been appropriately accounted in the books of account?        
2 Whether rejection for refund has been recorded appropriately?        

 

ACCOUNTS & RECORDS
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether   books   of   accounts   are maintained  as  specified  in  Section 35  r/w  Rules  56,  57  and  58  of  the GST Law?        
2 Whether   Books   of   accounts   are maintained         electronically         / Manually?        
3 Whether   books   of   accounts   are maintained    at    each    place    of business?        
4 Whether documents documents / agreements are available?        
5 Whether     Transporter/Warehouse keeper  has  maintained  the  books of Account as per the law?        
6 Whether     the     Register     E-way Bill/Delivery  challan  is  maintained as per the law?        
7 Whether  E-  Way  bills  are  used  for Valid purpose?        
8 Whether   the   register   of   ITC-01, ITC-02,    ITC-03    and    ITC-04    is
maintained as per the GST law?
       
9 Whether   the   books   of   Accounts maintained     are     centralized     or decentralized?        

 

MISCELLANEOUS
S.No. Particulars Checked By Yes / No / NA Remarks Action Taken
1 Whether the registered person has complied     with     Anti-Profiteering clause?        
2 Whether there was a reduction in the rate of GST and the provisions of Anti-Profiteering were complied?        
3 Whether there was a savings on account of ITC (on comparison with previous tax regime) and the provisions of Anti-Profiteering were complied?        
4 Whether any advance ruling was applied ? Whether the advance has been complied ?        
5 Are      there      any      departmental inspection         proceedings         for Transitional  Credits  or  any  other demands created?        
6 Any adverse remarks by Statutory Auditor / Internal Auditor has been raised and whether those are rectified?        

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