Chartered Accountant · ICAI M.No. 153926 · FRN 136869W
Mandatory regardless of turnover
Unlike LLPs or proprietors, a company’s audit doesn’t depend on turnover — it’s required from the first year.
Dormant companies too
Even a company with no operations must be audited and file AOC-4/MGT-7, or face penalties and strike-off.
Cost of treating it as optional
Founders of small or pre-revenue companies sometimes assume a nil-activity year needs no audit — it does. The audit, AOC-4 and MGT-7 are due every year from incorporation. Skipping them stacks up late fees of ₹100 per day per form with no cap, and persistent default can disqualify directors for five years and lead the Registrar to strike the company off. Reviving a struck-off company through the Tribunal is far costlier than the audit would have been. If a company is genuinely not going to trade, a formal dormant status or a clean voluntary closure is cheaper than simply ignoring the filings. The same applies to a company waiting for funding or a licence — the clock on audit and ROC filings runs from incorporation, not from the first sale.