FAQs on UDIN for Bank Audit

1. Whether UDIN is mandatory for Statutory Bank Audit?

For Statutory Bank Audit, UDIN is not mandatory. However, for all Certificates to be signed while conducting Bank Audit, generation of UDIN is mandatory as UDIN is already mandatory on all Certification w.e.f 1^st Feb.,2019.

2. While conducting Bank Audit, whether separate UDIN has to be taken for all Certificates as there are bulk of certificates to be signed?

UDIN has to be generated per Assignment per Signatory.

In Bank Branch Audit, One Branch is one assignment, hence, one UDIN for all certificates will suffice.

However, care should be taken that a list of all certificates bearing same UDIN should be compiled and handed over to management under a covering letter so that the UDIN generated cannot be misused by affixing on any other certificate which has not been signed by you.

3. In case if some Certificates are signed by one Partner while others are signed by another Partner, whether different UDIN is required for each such Partner?

UDIN has to be taken per Assignment per Signatory. Bank Branch Audit per Branch is one assignment and hence one UDIN for all certificates is enough.

However, if different partners are signing different certificates then separate UDIN has to be taken per signatory for the certificates signed by them.

4. Whether UDIN is mandatory for Tax Audit?

In the 2nd phase of UDIN applicability, ICAI Council has made generation of UDIN mandatory for all GST Audit and All Tax Audit from 1st April, 2019. Hence in Bank Branch Audit, separate UDIN has to be taken for Tax Audit.

5. Whether same UDIN which was generated for Certificates in Bank Branch Audit can be used for Tax Audit of the same Bank Branch?

Tax Audit is the separate assignment. Hence separate UDINs have to be taken while conducting Bank Branch Audit for each Branch.

Therefore, 2 separate UDINs are to be generated – one for Certificates and other for Tax Audit Report.

However, if certificates are signed by more than one partner then more UDINs on certificates have to be generated.

6. Whether UDIN is applicable to both Statutory Central Auditors (SCAs) and Statutory Branch Auditors (SBAs)?

Yes, UDIN is applicable to both SCAs and SBAs for Certificates and Tax Audit Reports while conducting Bank Audit.

7. Whether UDIN is to be generated for LFAR and / or other Bank Audit Reports?

As per UDIN applicability in 2^nd Phase, UDIN is not required to be generated for LFAR and other Bank Audit Reports now.

8. What is the process to generate UDIN for certificates under Bank Audits?

For generating UDIN, the “Document type” is to be selected as “Certificates”. Thereafter, date of signing of the document is to be mentioned. Under “Type of Certificate” select “Certificate issued by Statutory Auditors of Banks”.

There are 3 mandatory fields for entering the financial figures / values from the document and the description of the figure/ value so entered.

The names of the Certificates are to be mentioned under the Caption “Document Description”.

9. How to generate one UDIN for more than one Certificate when there are 3 mandatory filled to be given from the Certificates?

While generating one UDIN for all the Certificates, some common figures /parameters should be given in 3 mandatory fields and if no common figure is there then name of the Bank and Branch, Advances, Deposits etc must be the one common field which can be correlated with all the certificates.

10. Whether UDIN is mandatory for Tax Audit Reports that are filed online using Digital Signature?

UDIN will be applicable both for manually as well as digitally signed Reports / uploaded online. In case of digitally signed / online reports, UDIN has to be generated and retained for providing the same on being asked by any third party/ authority.

Major Amendments laws effective from 1st April 2019

1)    Upper limit of turnover for composition scheme  to be raised from 1 Crore to Rs 1.5 Crore.

2)    Composition dealers will now be allowed to supply services upto value not not exceeding 10% of turnover of the preceding financial year or Rs 5 Lakh whichever is higher.

3)    The threshold exemption limit for registration in the states of Assam, Arunachal Pradesh, Himachal Pradesh, Meghalaya, Sikkim & Uttarkhand  has been raised from Rs 10 Lakhs to Rs 20 Lakhs. Other states have been given the option to raise the limit to Rs 40 Lakhs.

4)    Taxpayers can opt for multiple registrations within the same state/ Union Territory for multiple places of business. Further at the option of the taxpayer the unutilized Input Tax credit in the existing registration can be transferred to the newly registered places of business. For this  Form GST ITC-02A is required to be furnished within 30 days of obtaining such separate registrations.

5)    Mandatory registration is required in case of e-commerce operators  who are required to collect TCS.

6)    Registration to remain temporarily suspended while cancellation of registration is under process so that taxpayer is relieved of continued compliance under the law.

7)    Widened scope of Input tax credit:

A) Motor Vehicles for transportation of persons having seating capacity more than 13 persons including driver, vessel and aircraft

b) Motor Vehicles for transportation of money by a Banking Company or Financial Institutions

c) Service of general insurance, repairs and maintenance in respect of motor vehicles, vessels and aircrafts on which credit is available.

d) Goods and Services which are obligatory for an employer to provide to its employees under law for time being in force.

8)    Commissioner has been empowered to extend time limit for return of inputs  and capital sent on job work up to a period of two years .

9)    Supply of services will qualify as exports even if payment is received in Indian rupees which are permitted by the RBI.

10) Place of supply in case of job work of any treatment or processes done on goods temporarily imported into India and then exported without putting them to any other use in India.

11) Changes in Real estate sector

    a) Under Construction House property

        i) GST can be charged at a rate of 8% if following conditions are satisfied:

·         80% of materials are purchased from registered dealers.

·         Cement if purchased from unregistered dealers then R.C.M has to be paid at 28%

·         No input tax credit is allowed.

        ii)GST can be charged at a rate of 12% along with availing input tax credit.

b) Affordable housing scheme projects with

Ø  Area of 60 sq.m in metro cities and 90 sq.m in non-metro areas and

Ø  With a value equal to or below rs 45 Lakhs

Will be charged GST at a rate of 1% with no claim of input tax credit.

(Earlier it was 5% with Input Tax Credit)

Calamity Cess

§  Dealers under composition scheme are not liable to levy calamity cess.

§  0.25 % flood cess to be levied on goods under fifth schedule including gold, silver and platinum.

§  1% flood cess to be levied on all supply of goods covered under GST rates 12%,18% & 28%

§  1% of flood cess to be levied on all services

§  The cess is to be calculated on value of supply.

§  Cess would be applicable on intra state supplies

§  Cess to be levied on last supply point that B2C transaction.

§  The effective date its implementation is yet to be announced

Courtesy : CA. Thomas K George B Sc, FCA