Section 97 in West Bengal Co-operative Societies Act, 2006
97. Audit of accounts of Co-operative society.
(1)[(a) Every Co-operative Society shall file return, within six months of the close of every co-operative year, to the Director of Co-operative Audit and to the Registrar including the following matters, namely] [[Substituted by section 12(1)(a) of the West Bengal Co-operative Societies (Second Amendment) Act, 2013, (West Bengal Act No. 7 of 2013), w.r.e.f. 19.2.2013, earlier section read as follows :(a)Every Co-operative society send to the Director of Co-operative Audit and to the Registrar within three months from the closing date of each Co-operative year an annual return consisting of a cash account, profit and loss account, a balance sheet and trading account where applicable in the Form as prescribed.]] :-(i)annual report of its activities;(ii)its audited statement of accounts;(iii)its cash account, profit and loss account, balance sheet and trading account where applicable in the Form as may be prescribed;(iv)plan for surplus disposal as approved by the general body of the Co-operative Society;(v)list of amendments to the bye-laws of the Co-operative Society, if any;(vi)declaration regarding date of holding of its general body meeting and conduct of elections when due; and(vii)any other information required by the Registrar in pursuance of any of the provisions of this Act;(b)[ Accounts of every Co-operative Society shall, within six months of the close of the co-operative year to which such accounts relate, be audited at the expense of the Co-operative Society by an auditor to be appointed by the general body of the Co-operative Society from the panel of auditors to be prepared with the persons appointed or authorised by the State Government or by the Director of Co-operative Audit with the approval of the State Government to act as an auditor by general or special order in writing in this behalf from among the officers under its administrative control, or the members of the Institute of Cost and Works Accountant of India constituted under the Cost and Works Accountants Act, 1959 (23 of 1959) and members of the Institute of Chartered Accountants of India constituted under the Chartered Accountants Act, 1949 (38 of 1949), having such qualification, such experience, and in such manner as may be prescribed. Such panel of auditors shall remain valid for five years.] [[Substituted by section 12(1)(b), ibid, w.r.e.f. 19.2.2013, earlier section read as follows :(b)Account of every Co-operative society shall at least in each Co-operative year, be audited at the expenses of the Co-operative society by the Director of Co-operative Audit or by a person appointed or authorised by him to act as audit officer by general or special order in writing in this behalf from among the officers under his administrative control or from the panel of auditors which shall include the members of the Institute of Cost and Works Accountant of India constituted under the Cost and Works Accountant Act, 1959 and members of the Institute of Chartered Accountants of India both having certificate of practice issued by the respective Institutions. Such panel of auditors shall be prepared either by the State Government or by the Director of Co-operative Audit with the approval of the State Government in the manner as may be prescribed, from the members of the above named two institutions by obtaining applications from them and the panel shall remain valid for three years.]](c)[ The auditor or auditing firm, as the case may be, referred to in clause (b) shall be appointed by the general body of the Co-operative Society.] [Inserted by section 12(1)(c) of the West Bengal Co-operative Societies (Second Amendment) Act, 2013, (West Bengal Act No. 7 of 2013), w.r.e.f, 19.2.2013](d)[ The audit report of the accounts of all apex and federal Co-operative Societies shall be laid by the State Government before the State Legislature in such manner as may be prescribed.] [Substituted by Act No. 13 of 2015 (w.e.f. 25.5.2010).](2)(a)The Director of Co-operative Audit shall draw up an audit programme [under intimation to the Co-operative Societies and thereupon the Co-operative Societies shall issue appointment letter to the auditor] [Substituted by section 12(1)(d) of the West Bengal Co-operative Societies (Second Amendment) Act, 2013, (West Bengal Act No. 7 of 2013), w.r.e.f. 19.2.2013, for the words and issue appointment letters to the audit officer under intimation of such appointment to the Co-operative societies.] not later than 28th February of each Co-operative year. In the case of running audit, the audit programme shall be drawn up and intimated two months before commencement of each Co-operative year. All apex Co-operative societies, Central Co-operative societies, primary urban Co-operative Banks, primary Agriculture and Rural Development Banks and such other Co-operative societies whose working capital on the last day of the Co-operative year exceeds rupees two crore rupees, shall come under the purview of running audit.(b)An audit officer shall complete the annual audit [within nine months] [Substituted 'within six months' by Act No. 13 of 2015 (w.e.f. 25.5.2010).] from the closing date of the relevant Co-operative year, failing which the audit officer shall explain in writing to the Director of Co-operative Audit the reasons for non-completion of audit.(c)If the audit officer appointed from the panel of auditors does not take up the audit within two months from the closing date of the Co-operative year or of the date of his appointment and does not intimate sufficient reason for not taking up audit, his appointment shall stand cancelled and the Director of Co-operative Audit shall appoint another audit officer in his place:Provided, that nothing in this clause shall apply to officers of the Directorate of Co-operative Audit of the State Government but the audit officer shall submit report in writing to the Director of Co-operative Audit stating the reasons for which he has failed to take up the audit within two months from the closing date of the Co-operative year; failing which it would be treated as negligence on the part of the audit officer.(3)(a)The Director of Co-operative Audit shall not appoint the same audit officer to audit the accounts of the same Co-operative society for more than three successive Co-operative years.(b)Unless otherwise directed by the State Government the accounts of the apex Co-operative society, Central Co-operative Banks, urban Co-operative Banks and the Agriculture and rural development banks shall be audited by the panel of auditors appointed by the State Government or by the Director of Co-operative Audit :Provided that when the audit of the accounts of a Co-operative society is in arrear for three years or more, an audit officer may be entrusted by the Director of Co-operative Audit to audit the accounts of the Co-operative society for all such Co-operative years.(4)(a)If at the time of audit, the audit officer finds the accounts of the Co-operative societies are not complete, he shall report the matter to the Director of Co-operative audit who shall cause the accounts to be completed at the expense of the Co-operative society by an accountant from the panel of accountants to be maintained in the range office. The panel shall be prepared by obtaining application from the persons who have qualification in commerce and live in range area.(b)A Co-operative society may, at its discretion, get its accounts prepared with the help of an accountant empanelled under clause (a) of this sub-section.(5)The audited statement of accounts of a Co-operative society together with the auditor's report shall be final and binding on the Co-operative society.(6)An audit under clause (b) of sub-section (1) shall include annual audit, monthly running audit, concurrent audit and re-audit and other matters as may be prescribed.Explanation I.- "annual audit" shall mean audit of accounts of Co-operative society annually for each Co-operative year.Explanation II.- "running audit" shall mean audit of accounts of the Co-operative society within a co-operative year on monthly basis. The auditor shall issue running audit memo monthly pointing out the irregularities noticed and the board of the Co-operative society shall submit rectification report after considering the audit memo in its next meeting.Explanation III.- "concurrent audit" shall mean audit of accounts of Co-operative society within a Co-operative year on daily basis. The auditor shall issue audit memo pointing out the errors and irregularities daily and the Co-operative society shall submit a rectification report within three days from the date of receipt of the audit memo.[Explanation IV. - "re-audit" of accounts of the Co-operative society shall mean fresh audit of accounts of the Co-operative society by a senior auditor appointed by the Director of the Co-operative Audit. The order for re-audit shall be issued by the Director of Co-operative Audit when a major discrepancy in the audited accounts of the Co-operative society in particular Co-operative year is noticed by him or when such re-audit is demanded by the Co-operative society on the basis of a resolution passed in its general meeting. If it appears to the State Government that it is necessary or expedient to re-audit the accounts of a Co-operative society. The provisions of the Act and rules framed thereunder as applicable to annual audit shall also apply to such re-audit.] [Substituted by Act No. 13 of 2015 (w.e.f. 25.5.2010).](7)Other types of audit are as follows:-(a)"cost and performance audit" where in the opinion of the State Government, it is necessary in the public interest so to do in relation to any Co-operative society or a class of Co-operative societies for ensuring management thereof in accordance with sound business principles and prudent commercial practices, the State Government may, by order, which shall be issued at least one month prior to the closing date of a Co-operative year, direct that the cost audit or performance audit or both of such Co-operative society or a class of Co-operative societies, as may be specified in the order, shall be conducted. On receipt of the order of the State Government, the Director of Co-operative Audit shall appoint under clause (a) of sub-section (2) a member or members of the Institute of Cost and Works Accountant from the panel of the auditors referred to in clause (b) of sub-section (1) to be the audit officer to conduct the cost audit or performance audit or both of such Co-operative society or a class of Co-operative societies and such audit officer shall complete the audit within the period specified in sub-section (2) and shall submit the report in accordance with the provisions of clause (b) of sub-section (1). The Director of Co-operative Audit may also appoint such audit officers for conducting cost audit or performance audit, or both, at the instance of any Co-operative society at the expenses to be borne by it.(b)"internal audit"-the Co-operative society mentioned in clause (a) of sub-section (2) or any other Co-operative society may appoint internal auditor to get its accounts internally audited so that the board of director can get a report from the internal auditor in each month and take appropriate decision.(8)The audit officer appointed from the panel of auditors shall be paid by the concerned Co-operative audit fees as may be prescribed.(9)The Director of Co-operative Audit may, as and when exigency arises, depute an auditor or a group of auditors for examination of books. accounts and such other papers and for verification of cash balance. The report thereof shall be deemed to be an audit report for the purpose of taking further action.(10)Every person, who is or has, any time within the period of 5 years from the date of audit, been an officer or employee or a member or a director of the Co-operative society shall furnish such information in regard to the transactions and working of the Co-operative society as the Director of Co-operative Audit or the person authorised by him may require.(11)If during the course of audit of any Co-operative society the auditor is satisfied that some books of accounts or other documents contained any incriminatory evidence against the past or present officer or employee of the Co-operative society, the auditor shall immediately report the matter to the Director of Co-operative audit and with the previous permission of the director may seize the books of accounts and give a receipt thereof to the Co-operative society.(12)The audit or accounts of a Co-operative society shall be conducted in the manner and place as may be prescribed by the State Government. However, such Co-operative society shall give the audit officer all assistance necessary for completion of the audit and for this purpose. the audit officer shall prepare such statements and take such actions with regard to verification or examination of its accounts as he may require.(13)A Co-operative society shall pay an audit fee calculated in such manner and at such rate as may be prescribed :Provided that State Government may by notification exempt or remit such payment of audit fees for certain categories of Co-operative societies as may be prescribed.(14)The Director of Co-operative audit may undertake audit of accounts of organisations other than Co-operative societies only with the prior approval of the State Government on such terms and conditions as may be prescribed or specified by the Government.
