General Circular No. 32/2003


Government of India

Ministry of Finance

Department of Company Affairs

5th floor, `A’ Wing,  Shastri Bhavan,

Dr. R.P. Road, New Delhi.

Dated: 10th November, 2003


All Regional Directors

All Registrars of Companies

Subject: Compliance of  Companies (Auditor’s Report) Order, 2003 effective from 1st July, 2003


As you are aware, vide notification number G.S.R. 480(E) dated 12th June 2003, Government have issued the Companies (Auditor’s Report) Order, 2003 [Order] which came into force on 1st July, 2003. The new Order replaces the Manufacturing and Other Companies (Auditor’s Report) Order, 1988  (MAOCARO) issued vide Notification No: G.S.R. 909(E) dated 7th September, 1988.

2.Subsequently the Government have received representations stating the difficulty in complying with the new Order at short notice, in view of the absence of a  Guidance Note from the Institute of Chartered Accountants of India, and in view of the need for maintaining records of a company in a manner that will ensure the compliance of the Order, Government have given consideration to the difficulty expressed. It has been decided that it is not possible, at this point of time, to review the Order, or postpone the effective date as issued, for accounts prepared in respect of financial year ending on the 1st July, 2003  or thereafter.

3. However, keeping in view the difficulties of the companies as well as the professionals involved, it has also been decided that while companies to whom the Order is applicable, should make serious efforts to comply with the new Order from the effective date, cases of non compliance for accounts pertaining to financial year which closed on 31st December, 2003 or earlier, Government would take a lenient view provided the accounts at least carry MAOCARO Report, if required.

4.  However, accounts in respect of financial years ending on 1st January, 2004 or thereafter, will have to strictly follow CARO, 2003. Companies and professionals who do not comply with the Order will be liable for action as per law.

5. Kindly acknowledge receipt of this letter, a copy of which is being endorsed to the Institute of Chartered Accountants of India and major Industry Associations.

Yours faithfully,

(E. Selvaraj)

Joint Director (Trg)

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