# Audit of Accounts of Branch Office of Company [Section 143]

When a company has branch offices (whether in India or abroad), the accounts of such branches must also be audited. Section 143(8) lays down who is eligible to conduct such audits.

## (A) Branch in India

Audit of the branch's accounts may be done by:

1. The company's auditor (i.e., the principal/statutory auditor), OR

2. Any other person qualified for appointment as auditor of the company under Section 141.

## (B) Branch Outside India

Audit of the branch's accounts may be done by:

1. The company's auditor, OR

2. An accountant, OR

3. Any person duly qualified to act as an auditor of accounts of the branch as per the laws of that foreign country.

## Summary Table

Location of Branch	Eligible Auditors
In India	Company's auditor OR person qualified u/s 141
Outside India	Company's auditor OR an accountant OR person qualified under foreign country's law

## Branch Auditor's Duties and Reporting

The branch auditor shall prepare and submit a report to the company's principal auditor.
The principal auditor will then deal with the branch report as required for the company audit (typically referencing it in the main audit report).
The branch auditor has the same powers and duties as the company's auditor in relation to the branch he audits.

Worked example

### Example 1

Example: Foreign Branch Audit

ABC Ltd., an Indian company, has a branch office in Singapore. Can the branch's accounts be audited by a Singapore-based accountant who is not a CA registered in India?

Analysis: As per Section 143(8), accounts of a branch office outside India can be audited by:

1. The company's auditor (Indian CA firm), OR

2. An accountant, OR

3. A person qualified under the laws of that foreign country.

A Singapore-based accountant qualifying under Singapore's audit laws is eligible.

Conclusion: Yes, the Singapore-based accountant can audit the branch's accounts. He must submit his report to ABC Ltd.'s principal Indian auditor.

⚠️ Common exam mistakes

Believing only the principal auditor can audit branch offices — a separately qualified person may be appointed.
Applying Indian audit qualifications to foreign branches — a person qualified under foreign law is also eligible.
Forgetting that the branch auditor must report to the company's principal auditor (not directly to members).
Assuming branch audit is optional — if accounts are maintained at the branch, audit u/s 143(8) is mandatory.
Believing the branch auditor's powers are limited — he has same powers and duties as the company's auditor in relation to the branch.

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 (herein referred to as the 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, or 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 by any other person duly qualified to act as an auditor of the accounts of the branch office in accordance with the laws of that country.

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Branch Office Audit – Section 143

Worked example

⚠️ Common exam mistakes