Key Financial Reporting & Audit Considerations for FY 2024-25:

Key Financial Reporting & Audit Considerations for FY 2024-25: 1️⃣ CARO 2020 Exemption for Small Companies: Small companies are excluded from the applicability of CARO 2020. Ensure compliance assessment before reporting. 2️⃣ Provisions & Contingencies – AS 29 / Ind AS 37: Review all outstanding provisions to ensure they are correctly recognized, measured, and disclosed under the applicable accounting standards. 3️⃣ Unadjusted Advances Over 365 Days: Identify old advances that have remained unadjusted beyond a year and assess their treatment under Deposits Rules. 4️⃣ FD-Backed Loans – Charge Creation: If the company has availed loans backed by fixed deposits, verify that a charge has been appropriately created and disclosed. 5️⃣ Interest Provision for Delayed MSME Payments: Failure to pay a micro or small non-trading enterprise within the stipulated timeline under the MSMED Act requires an interest provision in financials. 6️⃣ CSR Expenses – Separate Line Item in P&L: Corporate Social Responsibility (CSR) expenses must be clearly presented as a separate line item on the face of the Profit & Loss statement. 7️⃣ Unspent CSR Account – Year-wise Segregation: Companies must maintain separate bank accounts for unspent CSR funds on a year-wise basis, not project-wise. 8️⃣ Audit Trail Preservation Becomes Mandatory: This is the first year where companies must explicitly state that their audit trails are preserved as per regulatory requirements. 9️⃣ SA 720 Reporting – Applicable to All Companies: Auditors must evaluate other information in annual reports and provide a comment under SA 720 (The Auditor’s Responsibilities Relating to Other Information). 🔟 Do Not Mix Up Qualifications with Emphasis of Matter (EOM): EOM is not a qualification. Be careful to separately disclose audit qualifications, adverse opinions, or disclaimers without merging them with EOM paragraphs. 1️⃣1️⃣ Deferred Tax Asset (DTA) – Provide Evidence: If the company recognizes a DTA, supporting evidence must be disclosed to demonstrate future taxable profits that justify its recognition. 1️⃣2️⃣ Title Deeds of Immovable Property – Include Investment Properties: Companies often disclose title deeds only for PPE (Property, Plant & Equipment). Ensure investment properties are also included in the disclosure.