Introductions an LLP is a distinct legal entity, it will be required to keep annual financial statements that provide a truthful and accurate information about the situation. Each year, an LLP must file a "Statement of Solvency and Accounts" in the prescribed format annually with the Registrar.

Applicability

• Every LLP must have its books audited in accordance to Rules 24 in the LLP Rules, x 2009.
• LLP does not have to have its books audited, if
•  
1. The turnover cannot be more than the amount of 40 Lakh rupees (in any financial year) and
2. Contribution is not more than $25 Lakh dollars (in the course of any fiscal year).
• However, the accounts of LLP can be audited at any time with the consent of the partners who are members of the LLP and the accounts will be audited only in compliance to this rule.

Filing Forms that use ROC

• Annual Refund The annual return for every LLP is required to file an the annual return on Form 11 and ROC in the 60-day period of the close of the financial Year.
• Statement of Accounts and Solvency Every LLP must submit the "Statement of Solvency and Accounts" with Form 8 in a timeframe of 30 days after the close of six months of the Fiscal Year in which it is a part.

Benefits from LLP Audit

• Detection of Frauds and Errors The process of auditing the accounts of an LLP assists in identifying errors and fraud and verification of financial statements
• Resolution of Disputs Disputs, if there are any between any partner in the area of accounting or profits , can be resolved with the aid of audited books of accounts. Additionally, it assists in the settlement of the accounts upon admission or death or insolvency, retirement or other similar circumstances. between the partners.
• Loaning Funds: Financial institutions and banks loan money to firms exclusively on the foundation of their audited books of accounts.

Nomination by LLP Auditor:
The auditor is chosen by the partners who have been designated in cases of LLP(LLP)

• For the First FY at any point during the first year of the financial year, but not before the conclusion of the first financial year.
• for the next fiscal year: At least 30 days prior to the close of the financial year.
• For casual vacancies: Designated partners to fill the casual vacancy within an office within the LLP or caused by the removal from the office of an auditor.

The partners can appoint auditors in the event that the partners designated are not able to choose their auditors.

Auditor's Duty in relation to The Audit of LLP

• It is the responsibility of the auditor to receive clear instructions in writing regarding the tasks to be carried out by him
• The auditor should include:
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1. If the financial books of the firm seem to be reliable and accurate
2. If he was in a position to gather all the data and the explanations required to conduct the audit
3. What restrictions are was imposed by company's management.
• The auditor should go over the LLP Agreement and note the following elements
1. The nature of the business of LLP
2. Capital is contributed by each of the partners
3. The duration of the partnership
4. Drawings are allowed to the partners
5. The borrowing power of the LLP
6. The rights and duties of partners
7. Advances and loans made by the partners
8. Ratio of profit sh