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Starting from 1st April 2023, the Ministry of Corporate Affairs has made it mandatory for businesses to maintain an audit trail for all transactions. The new rule mandates the use of accounting software that has an audit trail (edit log) feature to record all transactions and track any changes made to the same, with auditors tasked with the responsibility to review and control the same.
The new audit trail rule in accounting software will now be implemented from 1st April,2023. This was originally planned for 2021 and but later the effective date was moved to 1st April,2023.
As MCA's requirement, the audit trail feature should create an edit log for any changes made on transactions and record the date of each change being made and cannot be disabled.
This would enable businesses to track all financial activities while helping to maintain transparency and detecting fraud. It would maintain an edit log of any changes made pertaining to various financial transactions, thereby improving business accuracy.
While it is clear that the new rule helps mitigate various anomalies like unauthorized changes and prevent fraud, as a business, you might have questions about the key requirements of the audit trail (edit log) rule. What are the major aspects that the notification emphasizes? What would be its immediate impact? Keep reading to get a deeper understanding of the new audit trail (edit log) rule.
|The Business Impact of Audit Trail (Edit Log) Rule|
While the new rule has been implemented to bring in transparency and reduce data anomalies, mandating businesses that are using accounting software to have the audit trail (edit log) feature, here are some major aspects that notification emphasizes:
While it has been clear that companies that fall under the purview of the MCA notifications need to have accounting software that comes with the audit trail (edit log) feature, the question that remains is what all aspects you should consider while making the shift. To answer this, here's a detailed insight into the features to look for in accounting software:
The latest release 'TallyPrime Edit Log Release 2.1', is enhanced with the edit log feature that caters to the amendment released by the Ministry of Corporate Affairs (MCA). Following are the features of TallyPrime edit log release:
Read more about audit trail
Audit Trail – Meaning & Examples, Why do We Need an Audit Trail (Edit Log) for Businesses, How to Prepare your Business for Audit Trail (Edit Log) Rule, 5 Features to Look in Audit Trail (Edit Log) Accounting Software, Audit Trail – Edit Log the New Statutory Watch Guard for Businesses, How Audit Trail (Edit log) can Lead to Increased Compliance and Transparency
Audit trail rule
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