[Analysis] of CSR Provisions, Audit Checklist and Reporting Responsibilities
- Blog|News|Account & Audit|
- < 1 minute
- By Taxmann
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- Last Updated on 19 May, 2023
1. Introduction
Corporate Social Responsibility means and includes projects or programs relating to activities undertaken by a company as specified in Schedule VII to the Companies Act, 2013 (e.g. tree plantation undertaken by the coal mining company).
2. Applicability of Corporate Social Responsibility
The Companies Act, 2013 mandates every company to have a net worth of Rs. 500 crores or more, or turnover of Rs. 1,000 crores or more, or a net profit of Rs. 5 crores or more, during the immediate preceding financial year.
3. Audit Checklist for CSR Activities
CSR Audit refers to a systematic assessment and evaluation of a company’s CSR practices and performance. It involves a comprehensive review of the company’s social, environmental, and ethical initiatives to determine their alignment with established CSR standards, guidelines, and regulatory requirements. To ensure an efficient and effective CSR audit, auditors can utilize the following checklist as a guide:
I. The auditor needs to check, whether the activities performed under CSR by the company are within the purview of Schedule VII of the Companies Act, 2013
II. Has the auditor checked whether any contributions or donations made as CSR activity comply with the specific categories outlined in Schedule VII of the Act
III. Whether separate disclosure of expenditure on CSR activities as required by Schedule III of the Act, has been disclosed by the company
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