Do Taxpayers in India is Getting any Benefits from the Government?

The income tax department gives out detailed data on tax return filers each year. It has been going on from the assessment year 2012-13, or AY13, onwards. The data for AY1 has been recently published. AY19 dabbles in income earned during the fiscal year 2017-18, or FY18, (i.e. the period between the months of April 2017 and March 2018).

The data provides a number of key insights about the great Indian taxpayer.  You can get the details of the same from the auditors in Chennai. As per the data, only around ₹37,400 crores is generated as far as income from house property in a year (via rents after adjusting for home loan interest and so on) in the entire country, which shows that most of the transactions are still cash-based and outside the paradigm of the tax net. The declared salary income, however, is more than double the size of the declared individual business income, which puts a wrench in the theory about the purview of the salaried middle class.

When it comes to individual income tax, there are different types of income that are taxed. This includes salaried income, the income coming from the house property, business income, and interest income. The individual-declared total income during the AY19 stood at Rs.34.1 trillion. Of this RS 20 trillion, or the bulk of the income was declared by the salaried income. 

The government announced an income tax rebate for the salaried people to be Rs 12,500 under Section 87A of the Income Tax Act. Earlier, the rebate was Rs 2,500. This available rebate is Rs 5 lakh a year.

This spells out zero tax for annual income up to Rs 5 lakh. There is an exemption from income tax on annual income amounting to Rs 2.50 lakh. This exemption can extend up to Rs 3 lakh in the case of senior citizens.

The standard deduction by the government was up to Rs 40,000 to Rs 50,000 and it increased the income tax rebate under Section 87A income-tax Act.

Besides, there is another deduction up to Rs 1.5 lakh under section 80C for investments made in instruments such as Public Provident Fund and the expenses incurred on children's education fees and stamp duty paid for the house registration.

Investment up to Rs 50,000 in the national pension scheme makes for additional tax deduction Section 80CCD(1B) of the Income Tax Act.

However, the income tax slabs were not changed until February's interim budget. There is zero tax on income amounting to Rs 2.5 lakh, beyond this tax rate it is 5 percent on income up to Rs 5 lakh amounting to Rs 12,500.

But with the government providing a rebate of the exact amount, there is no tax payable on income up to Rs 5 lakh. But such assessees are required to file their income tax returns every year. If they don't, the Income Tax Department may send notices for the same.

Twenty percent income tax is levied if the amount comes to Rs 5 lakh but not exceeding Rs 10 lakh a year. Income tax liability may turn out to be Rs 1 lakh in this slab.

An annual income of more than 30 lakhs calls for a 30 percent income tax. Plus, four percent cess on income tax is levied.

Find out about the Financial Statement Audit

A financial statement audit is all about examining the entity's financial statements and helps to accompany the disclosures all with the help of the services of the independent auditor. It results with a report submitted by the auditor, and it offers a fair presentation of the financial statements and other related disclosures. The auditor's report made by the chartered accountants in Chennai and other cities of the country should come with the financial statements when they are given to the intended recipients.

The chief objective of a financial statement audit is that it offers financial credibility to the reported financial position and also according to the performance of a business. The Securities and Exchange Commission says that all the entities that are under public domain must file annual reports with the ones that are audited. Similarly, lenders typically require an audit of the financial statements of any entity, which they have to lend. Suppliers also require audited financial statements before they extend trade credit (though that happens only when the amount of requested credit is a substantial amount. 

Know all about the primary stages of audit here, 

1. Planning and risk assessment. Besides understanding the business and the environment where it operates, they use this information to assess whether the risks involved and how it will affect the financial statements.

2. Internal controls testing. This helps the assessment of the effectiveness of an entity's suite of controls, which helps focus on the areas as per proper authorization, the safeguarding of assets, and also segregating of duties. This involves the array of tests, which is conducted on a sampling of transactions helping it determine the degree of control effectiveness. A higher degree of effectiveness helps the auditors to control some of the audit procedures. If the controls are not very ineffective (there may be a high risk of material misstatement), then the auditors must find out about other procedures to find out more about the financial statements. There are a number of risk assessment questionnaires available that helps with the internal controls testing.

3. Substantive procedures. This involves a broad number of procedures, a glimpse of which are the following,

• Analysis.
• Cash.
• Marketable securities
• Accounts receivable
• Inventory.
• Fixed assets.
• Accounts payable.
• Accrued expenses.
• Debt.
• Revenue.
• Expenses.

An audit made by the auditorsin Chennai and the other places, definitely one of the most expensive examinations of financial statements. The least expensive is said to be a compilation and the next one is a review. Due to its cost, many companies try to downgrade to a review or compilation, though this is only a compilation which you can follow if it is acceptable to one of the report recipients. Publicly held entities are required to get their quarterly financial statements reviewed apart from the annual audit.

Find out the Best Auditing Assurance Company in Chennai

Economic prosperity has changed the structure of chartered accountant services in India.  A Chartered accountant in India has multitude job roles ranging from monitoring reviewing and reporting various financial activities, providing advice on tax legislation and also advising on how to improve the business. A certified public accountant plays a leading role in handling all kinds of financial affairs with elan.

Functions of a Comptroller

Some of the important functions of actuary are the following:   

·         The preparation of financial statements.

·         Organize financial plans.

·         Looking after audits.

·         Filing of taxes.

·         Bookkeeping and so on.

Keeping abreast of financial statements can help track shortages in cash flow and loss of margins. A qualified accountant can help you in this regard; prepare all your accounts with a lot of dexterity and promptitude.

With the world economy taking giant strides towards progress, a business can only thrive with the right financial advice. However, a recorder is not there to only keep your business buoyant but also he/she helps to figure out ways to increase the margin of profits and thus help your company grow.

The role of a chartered accountant Chennai or anywhere else for that matter changes according to the changing needs of companies. While your business flourishes, the requirement of taxes and the procedures will undergo a change as well. In accordance with changing regulations, a registrar can come up with a tax strategy to reduce the amount of taxes needed to be paid to the government. Since tax laws are always changing, you will definitely need the services of an able CA to handle the management of accounting techniques and plan and prepare according to the State’s observation of regulations.

VRamaratnam & Company is renowned audit firm in Chennai and will help in compliance with the right reporting standards. Some of the important by-products of the audit process are identifying the important internal management problems and arming you with the right insight to solve both present and future challenges.

The fundamental rules of the business have hardly changed. If you want to meet with the investor expectations you must ensure that your presentation embodies accuracy, completeness and a competency in all your financial statements and disclosures. The audit helps sustain confidence in the company along with the financial system at large. This helps cater to the constantly-evolving business reporting environment.

Vramaratnam uses a single, global audit methodology that complies with the International Standards on Auditing, and evolves constantly to meet up with fresh standards. They focus on independence, quality, transparency and brand-new methodology that meets up with professional standards, and of course, adds the requisite value for your organization and stakeholders.

Audit Services - What is Audit & Assurance?

Auditors have to assess a set of company accounts to find out if they are the right representation of the company's affairs on the accounts date.

The audit provides the comfort or assurance to the users of the accounts that an auditor or an independent third party has carefully examined the accounts and agrees with them.Each and every individual line in a set of published accounts needs to be tested. Auditors actually do not test every transaction that notches up that figure. They prefer to perform two kinds of testing: these are

Substantive Testing and Control testing

Substantive Testing

When it comes to substantive testing, an auditor is supposed to select a sample of transactions that come up with a certain figure. For example, if we are testing the sales figure, you may select a number of sales and may want to see the evidence of these sales. This may include copies of cheques from customers, the purchase orders from customers or the may lead to correspondence or contracts with customers. Auditors will get to test it till they feel they are comfortable that the sales figure is correct.

Controls Testing

A control testing is one process which helps a company to reduce the risk of error or fraud. Each payment is each payment requires two signatories, one person fills in the cheque and the other person signs it.In companies with good controls exist, auditors can test the control rather than a sample of transactions.There are some common misconceptions about misunderstandings about auditors, they are as follows

Auditors in Chennai or anywhere else in India do not do the following things,They do not look for fraud, although they watch out for it.They do not check every transaction - just the 'material' ones.

An audit report is provided with every published account and the auditors also express their opinion on the accounts and bring to notice any issues they had with their audit. Auditors actually do not work for the client company, they rather work on behalf of the company's shareholders. The shareholders then decide the next auditor of the company.

Internal & External Audit

A company will also hire internal auditors to audit itself. This helps them to maintain a high standard of control right inside the organization and also helps reduce the load of work which needs to be sorted by the external auditors.

An external auditor, say an auditor firm in Chennai and other cities of the country,  on the other hand, is another independent firm that comes in and lessens the workload and carries out the audit work on behalf of the shareholders and the company, in other ,words,  helps them with chartered accountant services

These are some of the auditing services which can help you get rid of your financial woes and help you get all your financial problems in order with internal auditing as well as external auditing. If you are finding it tough to grapple with the existing financial situation of your company, consider getting help from a renowned audit firm in your city for best results.

How do Auditing Firms Get Audited?

Wikipedia describes an audit as, An audit is a systematic and independent examination of books, accounts, statutory records, documents and vouchers of an organization to ascertain how far the financial statements, as well as non-financial disclosures, present a true and fair view of the concern. It also attempts to ensure that the books of accounts are properly maintained by the concern as required by law. 

Auditors have to assess a set of company accounts to find out if they are the right representation of the company's affairs on the accounts date. The audit provides the comfort or assurance to the users of the accounts that an auditor or an independent third party has carefully examined the accounts and agrees with them.

How do Auditing Firms get audited?

In any big Audit firm, for example, an audit firm in Chennai, you will find there are "Audit Partners" and there is also a tax and advisorydivision. The tax and advisory along with all other non-audit lines of service are formed under the paradigm of Limited Liability Company (or equivalent). The audit practice will then be called "Partnership".

This stems from an age-old policy that Auditors, Lawyers, and Accountants should not have limited liability for providing wrong advice or assurance to third parties.

The current times dictates that most country legislation will still require an audit firm to be in a partnership with the audit partners. As it is a partnership you do not require a legal document to be audited.The partners, however, are required to provide for their personal income tax and are audited by the tax authority (IRA/IRS) personally.

Large audit firms get audited by the licensor of the firm's brand name such as individual KPMG, PWC, EY, and Deloitte have to follow some specific financial guidelines internally so that they can stick to the brand name, and hence these KPIs are under the scanner and monitored closely. However, it is in no way comes near to a full audit that some of the private companies face.

VRamaratnam & Company are distinguished auditors in Chennai that meet up to applicable reporting standards with perseverance. There are a number of by-products of the audit process such as finding out the internal management issues and other important insights that can cater to the present and future challenges too.

While some of the rules of the game stand transformed as of today some of the basic fundamentals remain unchanged.  The investor must add accuracy, completeness, and fair presentation of information in the financial statements and disclosures. The auditing process helps maintain the confidence of both the company and the financial system too. For the charteredaccountants in Chennai and the other cities of the country, the main challenge is keeping up with a fast-evolving corporate reporting environment.