Internal Audit & Controls
Controls matter only if they work in practice. We test processes against evidence, verify what is physically there against what the books say, and strengthen controls in the order that risk demands.
Discuss an internal audit requirement →Internal audit
Independent review of how the business actually runs.
- Appointment as internal auditor under Section 138 of the Companies Act, 2013
- Risk-based annual audit plan
- Unit, branch and departmental audits
- Periodic reporting to management or the audit committee
- Follow-up on agreed action points
- Internal audit for entities not covered by Section 138
Stock & physical verification
Confirming that what is recorded is actually there.
- Periodic physical stock verification
- Raw material, work-in-progress and finished goods counts
- Reconciliation of physical stock with books
- Stock verification for lenders
- Fixed asset verification and tagging
- Scrap, wastage and rejection checks
Process & control reviews
Where errors and leakage usually begin.
- Purchase to payment
- Order to collection
- Stores and inventory movement
- Payroll and attendance
- Fixed assets and capital expenditure
- Cash, banking and petty cash
Concurrent & specialised audits
Regular checking, close to the transaction.
- NBFCs and other lending institutions
- Insurance companies and intermediaries
- Co-operative and credit societies
- Revenue leakage reviews
- Vendor and contract compliance checks
- Branch, depot and franchise audits
SOPs & control design
Putting the control in writing, then testing that it holds.
- Standard operating procedures
- Delegation of authority and approval matrices
- Segregation of duties review
- Risk register and control matrix
- Control testing and remediation tracking
- Support for management reporting on internal controls
Who this is for
Manufacturers with stock and process risk; companies crossing the Section 138 thresholds; businesses where reconciliation differences or stock shortages keep recurring; lenders and entities requiring independent verification. We work with businesses across Tamil Nadu, with site visits where the work requires them.
How we work
Understand
We begin with the business, its records and the requirement behind the engagement.
Examine
We work from your own records, documents and processes rather than assumptions.
Review
Findings and outputs are reviewed by the proprietor before anything is issued.
Report
Conclusions in plain language, with the decisions or filings they support.
Scope, deliverables and timelines are confirmed in a written engagement letter before work begins.
Common questions
Is internal audit compulsory for our company?
It applies to every listed company. For unlisted public companies, it applies if any of these were met in the preceding year: paid-up capital of ₹50 crore or more, turnover of ₹200 crore or more, borrowings from banks or public financial institutions exceeding ₹100 crore at any time, or deposits of ₹25 crore or more. For private companies, only two tests apply: turnover of ₹200 crore or more, or borrowings exceeding ₹100 crore at any point. The borrowing test looks at any point during the year, not just the closing balance.
Can a Cost Accountant be appointed as internal auditor?
Yes. Section 138 names a chartered accountant, a cost accountant, or such other professional as the Board decides. The internal auditor may be an individual, a firm or a body corporate, and may or may not be an employee of the company.
Can our statutory auditor also do our internal audit?
No. Section 144 lists internal audit among the services a statutory auditor cannot provide to the company it audits, directly or indirectly.
How often should stock verification be done?
It depends on value and movement. Fast-moving or high-value stock often warrants monthly or quarterly verification, while slower items may be covered annually with sample checks in between. What matters more than frequency is that differences are traced to a cause: receipt, issue, return, rejection or valuation, rather than simply adjusted.
What does an internal audit report actually contain?
The scope covered, what was tested and how, the findings with their evidence, the risk each one carries, and the agreed action with an owner and a date. Findings from the previous report and their status are carried forward, so points do not quietly disappear.
Can you do a one-time review instead of an annual appointment?
Yes. Many engagements begin as a single review, such as stock verification or a purchase-process check, and become a regular appointment only if the findings justify it.
We are not covered by Section 138. Is internal audit still worth it?
Often yes, particularly where stock, cash or multiple locations are involved. Many businesses below the thresholds carry more process risk than larger ones, simply because fewer people handle more of the work.
Do you visit our premises?
Yes, where the work requires it, such as physical verification, process walkthroughs and observing how controls operate. Documentary review can be handled remotely.
Applicability of Section 138 depends on the company's class and figures for the preceding financial year, and is assessed case by case. Engagements are accepted only where independence requirements are met.