Audit of trusts, societies and section 8 companies

What this covers

Audit and annual compliance for charitable and religious organisations — public trusts, societies registered under the Societies Registration Act, 1860, and companies licensed under section 8 of the Companies Act, 2013. The work covers the audit itself, the income-tax reporting that registration as a charitable institution carries, and the separate reporting that applies where the organisation receives foreign contribution.

Statutory basis

Several statutes at once, which is what makes this work different from a company audit. The governing instrument — trust deed, memorandum and rules, or memorandum and articles. The Societies Registration Act, 1860 or the applicable state public trusts legislation. The Companies Act, 2013 for a section 8 company, which needs a statutory audit in the ordinary way. The Income-tax Act, 2025 for the audit and reporting that registration as a charitable institution requires; for periods up to 31 March 2026 the corresponding provisions were the registration machinery of sections 12A and 12AB and the audit report in Form 10B or 10BB of the 1961 Act. The Foreign Contribution (Regulation) Act, 2010 and its annual return in Form FC-4 where foreign contribution is received.

Who it applies to

Any charitable or religious organisation claiming exemption on its income, once its total income before exemption exceeds the amount on which tax is not chargeable. Separately, a section 8 company is audited under the Companies Act whatever its income. An organisation registered under the FCRA has its own audit and return obligations, and its foreign-contribution funds must be accounted for separately from domestic funds — mixing them is the failure we most often find.

What we do

1. 1Read the governing instrument first, and check that what the organisation actually spends money on falls inside its stated objects.
2. 2Confirm the registrations that are live — charitable registration, approval for donations, FCRA, and the state registration — and whether any renewal is due.
3. 3Audit receipts and payments, income and expenditure and the balance sheet, verifying corpus and restricted funds separately from general funds.
4. 4Test the application of income against the requirement to apply it for charitable purposes, and identify any accumulation that needs to be reported.
5. 5Check that FCRA funds, where they exist, are received in the designated bank account and accounted for separately, and reconcile them to the FC-4 return.
6. 6Prepare the statement of donations received and the certificates to be issued to donors, so donors can actually claim their deduction.
7. 7File the audit report and the return, and give the trustees a written note on anything that needs correcting before the next year.

What you receive

Audited accounts

Balance sheet, income and expenditure account, and receipts and payments, with the auditor's report.

Income-tax report

The prescribed audit report for a charitable institution, filed and acknowledged.

Donation reporting

The statement of donations received, and the donor certificates to be issued.

FCRA position

Where FCRA applies, the reconciliation supporting the annual return in Form FC-4.

Governance note

A written note to the trustees on objects, application of income and anything that puts the exemption at risk.

Documents and information required

Trust deed, memorandum and rules, or memorandum and articles · registration certificates and any renewal orders · approval for donor deductions · FCRA registration and designated-account statements · books of account with donation records · grant agreements and utilisation reports · details of corpus and restricted funds · minutes of the trustees or governing body · last year's audited accounts and income-tax filings.

Key dates

The income-tax audit report is ordinarily due one month before the due date for the return, and the return follows. The statement of donations received and the donor certificates have their own annual dates, and a missed donor certificate cannot be cured by the donor. FCRA returns run to their own annual timetable. We work back from the earliest of them rather than treating the return as the only date.