CARO 2020 – Clauses 5, 6 & 7: Deposits, Cost Records and Statutory Dues

## CARO 2020 – Clauses 5, 6 & 7

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### Clause 5: Deposits (Sections 73–76 of Companies Act)

Report on:

• Whether deposits accepted comply with Sections 73 to 76 of the Companies Act
• If not compliant — state the nature of contraventions
• If any order has been passed by CLB / NCLT / RBI / any court or tribunal — whether the same has been complied with

> Sections 73–76 regulate acceptance of public deposits. Non-compliance is serious and must be specifically reported.

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### Clause 6: Cost Records (Section 148(1) of Companies Act)

Report on:

• Whether maintenance of cost records is as specified in Section 148(1)

> Section 148(1) empowers the Central Government to direct companies in specified industries to maintain cost records. Auditors must verify if the company falls under such an order and whether records are maintained accordingly.

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### Clause 7: Statutory Dues

This clause has two parts:

#### Part A: Undisputed Dues

Report whether the company is regular in depositing the following statutory dues:

• GST
• Provident Fund (PF)
• Income Tax (IT) / Advance Tax
• Sales Tax
• Employees' State Insurance (ESI)
• Customs Duty
• Excise Duty
• Any other statutory dues

If irregular: report arrears outstanding for more than 6 months from the date they became payable, as at the last day of the FY.

#### Part B: Disputed Dues

Where statutory dues have not been deposited on account of any dispute:

• Report the amount involved
• Report the forum where dispute is pending (e.g., Commissioner Appeals, ITAT, High Court, Supreme Court)

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### Quick Comparison: Undisputed vs Disputed