Maintenance of Books of Accounts: What the Law Requires

Every company must maintain proper books of account at its registered office with respect to: all sums of money received and expended, all sales and purchases, assets and liabilities, items of cost, and items relevant to the business. Books must be preserved for eight years (or from the date of incorporation for a newer company). Electronic records must comply with the Information Technology Act 2000. Audit under Section 139 is compulsory for all companies. Tax audit under Section 44AB applies if turnover exceeds Rs 1 crore (Rs 10 crore if 95 percent of transactions are digital).