Turnover certificate by the Chartered Accountants

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Turnover certificate by Chartered Accountants as per the Guidance Note by ICAI

Turnover certificate format as per ICAI

Chartered Accountants in practice are often called upon to issue reports/certificates for special purposes e.g. reports/ certificates required under the tax laws or for Government welfare schemes, tenders or registrations.

Many times members take issue on social media like "How can we issue "x" certificate?", whether CAs allowed to issue "x" certificates?, Bankers are asking meaning less certificates etc. etc.  I would like to bring your attention that as a CA you can issue various certificates/reports but important is it must be in accordance with applicable ICAI guidance notes. ICAI has already issued quality materials and guidelines, if you follow it you will be safe & secure. It is your professional opportunity so don't simply ignore or loose it, if you deny someone else will do it! 

  • Sometimes, the respective authority prescribes format of certificate to be given by CA. The wordings of such formats often requires the use of word or phrase like “certify” or “true and correct” to indicate absolute level of assurance expected to be provided by the practitioner on the subject matter. As per GN on Reports or Certificates for Special Purposes (Revised 2016) (“The guidance note”) Absolute assurance indicates that a practitioner has performed procedures as considered appropriate to reduce the engagement risk to zero. 

  • As per the Guidance note a practitioner is expected to provide either a reasonable assurance (about whether the subject matter of examination is materially misstated) or a limited assurance (stating that nothing has come to the practitioner’s attention that causes the practitioner to believe that the subject matter is materially misstated). A practitioner is not expected to reduce the engagement risk to zero. This is because there are inherent limitations attached to the procedures which a practitioner may perform in relation to issuance of a report or certificate, as the case may be.

  • Due to such limitations, depending upon the nature, timing and extent of procedures that can be performed based upon the facts and circumstances of the case, a report or certificate issued by a practitioner can provide either reasonable or limited level of assurance. 

  • Therefore, whenever a practitioner is required to give a “certificate” or a “report” for special purpose, the practitioner needs to undertake a careful evaluation of the scope of the engagement, i.e., whether the practitioner would be able to provide reasonable assurance or limited assurance on the subject matter. 
The guidance note provides few formats of report, attached herewith most widely used format i.e. report for Turnover/Net Worth/Net Profit/Working Capital/similar engagement pursuant to a Tender requirement etc.

First you have to prepare statement or report or certificate of turnover and give reference therein of the report as per ICAI guidance note. 


@ Article by CA Mayur Todmal

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