MCA defers mandatory Audit Trail feature in accounting software till 1st April 2022
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MCA has notified Companies (Accounts) Amendment Rules, 2021 vide its notification dated 24.03.2021 which states that for the financial year commencing on or after the 1st day of April, 2021, every company which uses accounting software for maintaining its books of account, shall use only such accounting software which has a feature of recording audit trail of each and every transaction, creating an edit log of each change made in books of account along with the date when such changes were made and ensuring that the audit trail cannot be disabled.
In addition to the above, following clauses have been inserted under rule 8, in sub-rule (5), after clause (x) :
(xi) the details of an application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year along with their status as at the end of the financial year.
(xii) the details of difference between the amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.
Accordingly, Board Report should contain the aforementioned additional information.
The notification shall come into force with effect from the 1 April, 2021.
MINISTRY OF CORPORATE AFFAIRS
NOTIFICATION
New Delhi, the 24th March 2021
In exercise of the powers conferred by section 134 read with section 469 of the Companies Act, 2013 (18 of 2013), the Central Government hereby makes the following rules further to amend the Companies (Accounts) Rules, 2014, namely:-
1. Short title and commencement.- (1) These rules may be called the Companies (Accounts) Amendment Rules, 2021.
(2) They shall come into force with effect from the 1st day of April, 2021.
2. In the Companies (Accounts) Rules, 2014,-
(1) in rule 3, in sub-rule (1), the following proviso shall be inserted, namely:-
“Provided that for the financial year commencing on or after the 1st day of April, 2021, every company which uses accounting software for maintaining its books of account, shall use only such accounting software which has a feature of recording audit trail of each and every transaction, creating an edit log of each change made in books of account along with the date when such changes were made and ensuring that the audit trail cannot be disabled.”
(2) in rule 8, in sub-rule (5), after clause (x), the following clauses shall be inserted namely:-
“(xi) the details of application made or any proceeding pending under the Insolvency and Bankruptcy Code, 2016 (31 of 2016) during the year alongwith their status as at the end of the financial year.
(xii) the details of difference between amount of the valuation done at the time of one time settlement and the valuation done while taking loan from the Banks or Financial Institutions along with the reasons thereof.”
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