Companies must have audit trail of transactions from next financial year

Will also have to maintain edit log of changes made in books of accounts; experts say no firm will be able to delete an entry, will only be able rectify it

In a move designed to improve transparency in financial reporting and prevent tampering of accounting entries, the Ministry of Corporate Affairs has made it mandatory for companies to ensure that their accounting software records the audit trail of transactions, April 1, 2023 onwards. The notification, which was first issued two years ago, would come into effect in two week’s time after getting pushed forward twice.

MCA has also made it mandatory for companies to maintain the edit log of changes made in the books of accounts.

A senior chartered accountant explained that companies would not be able to delete an