# Branch Audit — Section 143(8)

Where a company has a branch office, the accounts of that office shall be audited:

## Branch in INDIA

Auditor Eligible
The Company's Auditor (principal auditor), OR
Any other person qualified to be appointed as auditor of the company under Section 139

## Branch OUTSIDE INDIA

Auditor Eligible
The Company's Auditor, OR
An accountant or any other person duly qualified to act as auditor of accounts of the branch under the laws of that country

## Branch Auditor's Report

The branch auditor prepares a report on the accounts of the branch.
This report is sent to the company's auditor (principal auditor).
The company auditor shall deal with it in his report as he considers necessary.

## Diagram

```

Branch in India Branch outside India

↓ ↓

Co. Auditor / Person Co. Auditor / Person qualified

qualified u/s 139 under laws of that country

↓ ↓

Branch Audit Report → Sent to Company Auditor

↓

Deal with it in his report u/s 143(3)

```

Worked example

### Example 1

Q: ABC Ltd has a branch in Singapore. Who can audit this branch?

A: Under Sec 143(8), the branch may be audited by the company's auditor OR by an accountant duly qualified under the laws of Singapore. The branch auditor's report is sent to the company auditor.

### Example 2

Q: Can a person not qualified under Sec 139 audit an Indian branch of an Indian company?

A: No. For an Indian branch, the branch auditor must be qualified under Sec 139 of the Companies Act, 2013.

⚠️ Common exam mistakes

Assuming foreign branches must be audited only by Indian-qualified CAs — local law qualification suffices.
Forgetting that the principal auditor must address how he 'dealt with' the branch auditor's report in his own report.
Treating branch audit as optional — it is mandatory if the company has branches.

Bare-Act text Section 143(8) · Companies Act, 2013 · click to expand

Section 143(8) — Where a company has a branch office, the accounts of that office shall be audited either by the auditor appointed for the company (company's auditor) under this Act or by any other person qualified for appointment as an auditor of the company under this Act and appointed as such under Section 139. Where the branch office is situated in a country outside India, the accounts of the branch office shall be audited either by the company's auditor or by an accountant or any other person duly qualified to act as an auditor of accounts of the branch office in accordance with the laws of that country.

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