MCA update on Audit Trail Software

MCA had issued the mandatorily audit trail software notification on 24/03/2021 and the same was applicable for F.Y 2021-2022 but later MCA deferred the notification by a year. Thus the audit trail software  would be now applicable from 01/04/2022 onwards.
Please refer the below gist of notification. The MCA notification is attached for your reference.


Notification date




Companies (Accounts) Amendment Rules, 2021


Effective date

They shall come into force w.e.f 01.04.2022



All Companies


Brief description

According to this notification all the businesses who are using accounting software for maintaining books of accounts have to mandatorily use such an accounting software which is capable of creating log of each and every transaction with changes made in the books of account and capture the date on which such changes were made, further the edit trail also cannot be disabled.


Impact of notification

This notification shall improve the transparency, accountability and corporate governance as a whole.


Auditor’s Responsibility

The statutory auditor of the company has to comment in the audit report whether all transactions entered by the company is being recorded in such a software or not and whether such audit trail feature has not been tampered and the company is preserving such audit trail or not.

Complete circular attached -1

Complete circular attached -2

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