FreeComplianceBooks of accounts a company must keep under Section 128
Section 128 of the Companies Act requires every company to keep proper books of accounts at its registered office, on an accrual basis and under double-entry bookkeeping. If you use accounting software, it must also keep an audit trail of every change.
What the books must show
- All money received and spent, and what it was for
- All sales and purchases of goods and services
- Assets and liabilities
- Cost records, where the company is required to keep them
The books must give a true and fair view of the company's affairs, including those of any branch office.
How long to keep them
Books of accounts and vouchers must be preserved for at least eight financial years before the current one. Tax and GST laws may require similar periods.
Electronic books and audit trail
- Books can be kept electronically, with a backup on servers physically located in India, taken daily.
- Accounting software must record an audit trail of every transaction and edit, with the date of change, and it must not be possible to disable it.
- The auditor reports on whether the audit trail was maintained throughout the year.
Frequently asked questions
This guide is general information, not legal advice. Government fees and procedures change; confirm current figures before you file.
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