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Audit Trail Compliance in MerciGlobal Cloud ERP (Effective April 1, 2023)

As part of our commitment to aligning with legal and regulatory standards, MerciGlobal Cloud ERP fully complies with the audit trail requirements mandated by the Ministry of Corporate Affairs (MCA), India, effective April 1, 2023. These updates are critical to bolster corporate governance, enhance financial transparency, and ensure compliance readiness.

1. Applicability

This mandate applies to all companies registered under the Companies Act, 2013, including but not limited to:

  • 🧍‍♂️ One Person Companies (OPCs)
  • 🧱 Small Companies
  • 🏢 Section 8 Companies (Not-for-profit Organizations)
  • 💤 Dormant Companies
  • 🌍 Foreign Companies Operating in India

2. Key Requirements

Audit Trail Feature

MerciGlobal Cloud ERP incorporates a robust built-in audit trail system that ensures comprehensive logging of all transactions in accordance with MCA norms.

Edit Log Creation

Every modification in the books of accounts is automatically captured, including:

  • ✍️ Nature of the change
  • 🕒 Date and time of modification
  • 👤 Identity of the user who made the change

Non-Disabling of Audit Trail

The audit trail functionality in MerciGlobal Cloud ERP is permanently enabled and cannot be disabled or altered, safeguarding against tampering.

3. Auditor’s Responsibilities

Statutory auditors are required to validate the following:

  • 📅 Continuous configuration of the audit trail feature throughout the entire financial year.
  • 🔍 Assurance that the audit trail has not been tampered with or altered.
  • 📚 Verification that audit logs are retained in line with statutory guidelines.

4. Record Retention

As per Section 128(5) of the Companies Act, companies must:

  • Retain books of account and audit trails for a minimum of 8 years.

MerciGlobal Cloud ERP supports this requirement with robust data archiving and secure backup functionalities.

5. Penalties for Non-Compliance

Entity Penalty Details
Companies 💸 INR 50,000 to INR 500,000
Officers in Default 🕓 Imprisonment up to 1 year, or 💰 Fines INR 50,000 to INR 500,000, or both

6. Implementation Considerations

Software Upgradation

Ensure that your systems are updated or integrated with MerciGlobal Cloud ERP to fully comply with MCA audit trail standards.

Process Documentation

Maintain detailed SOPs (Standard Operating Procedures) and documentation of internal workflows for audit readiness.

Training & Awareness

Conduct regular training programs to:

  • Increase awareness of audit trail significance
  • Promote correct usage of MerciGlobal Cloud ERP
  • Ensure data integrity and compliance

Final Note

These regulatory measures not only enhance the reliability of financial reporting but also align Indian corporate governance practices with global standards. MerciGlobal Cloud ERP is engineered for full compliance, helping businesses effortlessly meet these critical statutory requirements.

📞 For more details, training sessions, or assistance with software upgrades, contact the MerciGlobal support team.