Section 35(1) of CGST Act, 2017 read with rule 56 of CGST Rules 2017 prescribed for maintenance of various records and documents along with other provisions of the act. Highlighting the checklist of accounts and records to be maintained under GST along with the Auditor’s checklist (though audit is not mandatory from FY 2020-21)
Exhaustive Checklist for accounts, records & documents to be maintained under GST
| S. No. | Type of Records and Documents |
| 1 | Finished goods Inventory Register – Details of Op. Stock, goods manufactured, purchased, goods sold/removed, given free, bye products and closing stock, HSN |
| 2 | Raw Materials/Packing Materials Inventory Register – Details of Op. Stock, purchased, goods sold/removed and closing stock, lost damaged, given free, HSN |
| 3 | Scrap/wastage Details – Details of opening stock, generated, removed, and closing stock |
| 4 | Input Tax Credit Register – Invoice No., Date, Supplier’s Name, address, GSTIN, Taxable Value, Tax, Total, accounting head. HSN |
| 5 | Invoices for a regular outward taxable supply |
| 6 | Invoices for exports |
| 7 | Invoices for Schedule I Supply |
| 8 | Invoices for Cross Charging (supplies to distinct persons) |
| 9 | Invoices for inward supplies received from un-registered persons |
| 10 | Bill of supply for an outward exempt supply |
| 11 | Payment Voucher (for payments made to suppliers of inward supplies liable for RCM) |
| 12 | Advance Receipt Voucher (When an advance is received) |
| 13 | Refund Voucher (When an advance is refunded) |
| 14 | Delivery challan (for movement of goods other than for supply) |
| 15 | Delivery challan (for job work) |
| 16 | Credit Note & Debit Note |
| 17 | Tax Ledger Accounts |
| 18 | Suppliers Details |
| 19 | Customers/Clients’ details |
| 20 | Details of premises where goods are stored |
| 21 | Check that the above records are maintained at the such respective place of business in case of more than one place of business as per the registration certificate |
| 22 | Check if there is a specific SOP maintained for GST. If not, whether the same need to be suggested |
Below is Auditor’s Checklist in respect of Outward Supply
| S. No. | Checklist |
| 1 | Check whether a taxpayer has issued, reported & maintained Tax invoices, Debit Notes & Credit Notes for the Goods or services supplied |
| 2 | Check if the Tax invoice contains all the details as required as per 46 of the CGST Rules |
| 3 | Check if mandatory 4 / 6 digits for goods and 6 digits for services are reported in the system for the requirement in the Annual returns |
| 4 | Check-in case of supply to SEZ/Export, the endorsement of supply of goods for export/authorized operations of SEZ under LUT/Bond is mentioned on the invoice |
| 5 | Check the invoicing series is unique for each GST registration number and that the series is in accordance with the provisions of the law (i.e. max 16 digits and does not contain special characters other than “-” or “/”) |
| 6 | Check whether an invoice is issued in triplicate copies in case of a supply of goods and duplicate copies in case of a supply of services. |
| 7 | In case a client has issued a Bill of Supply, Payment voucher, receipt voucher, refund voucher, Credit Note, Debit Note, etc. check whether all the particulars as required under r 49 to 52 are mentioned |
| 8 | Check whether the ISD issues the invoices as per the Rules and whether it contains all the particulars as required under Rule 54 of the CGST Rules |
| 9 | In case of a service provider is a GTA, then the invoice or consignment note shall contain the Gross weight, name of the consigner and the consignee, registration number of goods carriage, details of goods transported, place of origin & destination, GSTIN of the person liable to pay the tax |
| 10 | Check whether the delivery challan is issued in respect of the following: (a) supply of liquid gas where the quantity at the time of removal from the place of business of the supplier is not known, (b) transportation of goods for job work, (c) transportation of goods for reasons other than by way of supply Eg: Intra state branch transfers; Sale on approval; Inter-state movement for repairs, Removal of warranty spares, etc. |
| 11 | Check whether the delivery challan issued is as per Rule 55 of CGST Rules |
| 12 | Check those goods are transported in a semi-knocked-down or completely knocked-down condition: (a) The supplier issued a complete invoice before the dispatch of the first consignment (b) The supplier issued DC for each of the subsequent consignments, giving reference to the invoice (c) Each consignment is accompanied by copies of the corresponding delivery challan along with a duly certified copy of the invoice (d) The original copy of the Invoice is issued along with the last consignment. |
| 13 | Check if conditions of issuing invoices electronically are complied with if opted |
| 14 | Check whether invoices, challans and any other documents, etc. are duly authenticated by the person authorized to do in this regard. |
| 15 | Check whether E-invoicing provisions complied where applicable [Presently applicable for aggregate turnover of Rs.20 crore with few exceptions] |
Auditor’s Checklist for Inward Supply
| S. No. | Checklist |
| 1 | Check whether proper invoice and documentation of Input Tax Credits availed is maintained in the ITC register |
| 2 | Check whether the Input tax credit register maintained captures all basic information such as name, description of goods/service, registration number, HSN, and quantity of goods received. Details should be at invoice level including the details of credit taken on RCM |
| 3 | Verify if a credit availing document is in place for sample transactions that are not appearing in GSTR 2A |
| 4 | Sample verification of invoice or another document on which credit has been availed, to verify the correctness of ITC availed and whether the same is a valid document according to r 46 of CGST Rules & all such documents are in accordance with invoice rules. |
| 5 | Ensure that credits are not claimed on photocopies of invoices |
| 6 | Analyse the vendor master to verify the non-recording of GSTIN of any vendor or recording of invalid GSTIN of the vendor in the master records |
| 7 | Check if credits are properly accounted in special cases such as availing/reversal of past credits during September return or various reversals of credits made while filing GSTR 9 & 9C |
| 8 | Check if details of credit are properly bifurcated for inputs, input services, and capital goods, and HSN codes are captured at the time of passing entry in the accounts |
Auditor’s Checklist – Reverse Charge Mechanism
| S. No. | Checklist |
| 1 | Check whether all self-invoices generated for transactions covered under reverse charge with the unregistered suppliers and challans of RCM payment are filed in a separate file and easily retrievable |
| 2 | Check whether the working papers contain invoice-level details of the transactions on which tax is paid under RCM |
| 3 | Check if the entry for liability to pay taxes under RCM is accounted for in a separate ledger maintained for RCM |
| 4 | Check if the entries for GST liability under RCM are accounted at each entry level instead of a lump sum entry for the full month |
| 5 | Check if RCM liability is properly accounted for in special cases such as RCM payment of past period during September return or various payments of RCM made while filing GSTR 9 & 9C |
Auditor’s Checklist for Other Matters
| S. No. | Checklist |
| 1 | Check if all the department correspondences have been reverted and the same is replied to within the stipulated time |
| 2 | Check whether all the letters filed to the department are duly acknowledged by the department with stamps and signatures and have preserved acknowledgment in case of correspondence through RPAD |
| 3 | Check whether the postal cover of all letters received from the department is preserved properly |
| 4 | Check if a tracker is maintained to keep track of refund/rebate/other export benefits claimed by the entity along with the status of the same |
| 5 | Check if a tracker is maintained to keep track of litigations cases pending with the department at various stages |
| 6 | Understand the current status of pending cases at various stages audit, SCN, appeals, etc. |
| 7 | Understand if any taxes were paid due to departmental assessment, audit, scrutiny, verification, search, investigation, etc. and whether the said demands & payments are proper. Verify the legality of the demands raised and the correctness of the calculations viz., tax rate, the value adopted, etc. |
| 8 | In case any penalties are paid on the above, check whether the benefit of waiver of penalty u/s 73/74 is availed and verify the calculations for the correctness of the same |
| 9 | Broadly verify the replies, appeals filed and check if the case is genuine and whether proper grounds have been taken and whether is any latest update/judgment on the same matter requiring additional submissions |
| 10 | Understand if there has been any case of inspection, search, seizure, arrest, etc., and the reason for the same. Understand if adequate measures and legal safeguards were taken care of and the status of the matter |
| 11 | Check if any recovery proceedings have been initiated and whether any relief can be suggested in the form of payment of taxes under the instalment scheme etc. |
| 12 | Check whether all e-mails, notice, letter, order, and summon received from the department after 1st January 2020 are containing a DIN. |
| 13 | If DIN is not mentioned by the department in the communications sent, then verify whether it is covered under exceptions for issuing DIN. |
