Under GST there are three types of Audit wherein an audit of books of accounts involve thorough checking of books of accounts and their related documents which involves but is not limited to invoices, bank statements ,third party verifications as well
a) Mandatory Audit:
this involves the Audit by CA or ICWA depending upon the turnover threshold as required under the GST Act which says each registered person if his turnover crosses a threshold (currently it is 2.00 Cr) then has to get a GST Audit under sec 35 done by any CA or ICWA of his choice and to submit the audit report to the department.
Turnover has been defined in GST as follows:
sec 2(112) says
“turnover in State” or “turnover in Union territory” means
1) the aggregate value of all taxable supplies (excluding the value of inward supplies on which tax is payable by a person on reverse charge basis)
2)And exempt supplies made within a State or Union territory by a taxable person,
3)And Exports of goods or services or both and inter-State supplies of goods or services or both made from the State or Union territory by the said taxable person
4)but excludes central tax, State tax, Union territory.
To put it simply it is
Total Turnover less Reverse chargeable turnover including exempt and inter state supplies less any taxes
Commissioner can get the books of a registered person audit by departmental officer under sec 65
c)Special Audit: An officer not below the rank of Asst Commissioner can appoint a CA or ICWA if he feels fit a case in case of technical complexity under sec 66
Basis difference is that in first case the Audit though mandatory can be get done by the CA or ICWA of registered person’s choice but in other two cases the Audit is done by the persons appointed by the department.Summarised provisions are as under: