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Annual and periodic compliance requirements of LLPs

In this chapter, we shall discuss about the Periodic as well as annual compliance requirements of LLPs including audit requirements. These include maintaining the book of accounts and filing of certain forms electronically. As, in certain cases conducting an audit is not necessary, the conditions and the procedures are discussed in the note that can be viewed by clicking here.


Annual and Periodic Compliance Requirements for LLPs

I. Periodic compliance requirements

An LLP must maintain books of account, either on cash basis or accrual basis, in accordance with accounting principles, to show the LLP's transactions and disclose financial position. Books of accounts must be kept in such manner that they enable the designated partners to show that any Statement of Accounts and Solvency (see below in this note) complies with the LLP Act. These books must contain particulars of:

a)All monies received and expended by the LLP,

b)A record of assets and liabilities,

c) Statements of costs of goods purchased, inventories, finished goods and goods sold;

d) Any other particulars as may be decided by the partners. The decision to maintain records of any other particulars must be made by a resolution passed by the LLP in a meeting of the partners (including Designated Partners).


II. Annual compliance requirements

Annual compliance for an LLP is much less compared that required for a company. An LLP is required to maintain certain books of accounts for each year of business as explained above in this note. For the purpose of closing its books of accounts, it may opt for either the end of the financial year (March 31), or the end of the calendar year (December 31).

An LLP must file the following forms electronically with the ROC through the LLP site (http://llp.gov.in) for annual compliance:

1. Annual Return within sixty days of closure of its financial year in Form 11.

If the LLP has a turnover of less than 5 crore rupees, or capital contribution of less than 50 lakh rupees, the annual return must be accompanied by certificate from a designated partner (other than the signatory to the annual return), to the effect that annual return contains true and correct information.
If the annual turnover crosses 5 crore rupees or capital contribution above 50 lakh rupees, the annual return must be accompanied with a certificate from a practicing Company Secretary certifying that he has verified the particulars from the books and records of the LLP and found them to be true and correct.

© Intelligent Legal Risk Management Solutions LLP. Any unauthorized use, circulation or reproduction shall attract suitable action

under applicable law.

2. Statement of Accounts and Solvency within 7 months in Form 8

As per the law, each LLP must also file a Statement of Accounts and Solvency (“SAS”) for every financial year within thirty days from the end of six months of that financial year (that is, seven months). The SAS must be signed by designated partners and each designated partner will be presumed to have approved the SAS. The SAS must be filed with the ROC in Form 8, available on the LLP site. Fees to be paid are mentioned in a separate file called the Ready Reckoner on “Government fees payable during Incorporation and at the time of Annual Compliance” (subject to future updates).

3. Requirement of audit

An audit is not required for an LLP (unless the partners willingly decide to carry it out) if all of the following requirements are met:

a)its turnover does not exceed 40 lakh rupees,

b)the capital contribution of the partners does not exceed 25 lakh rupees.

Where an audit is not conducted, the LLP shall include in the SAS a statement to the effect of acknowledgment by the partners of their responsibilities must be made.

In all other instances, an audit must be conducted by a Chartered Accountant. The auditor must be appointed:


At least 30 days before the end of each financial year of the LLP,


Before the end of the financial year of the LLP.

The auditor will hold office in accordance with the terms of employment until new auditors are appointed or they are re-appointed.

© Intelligent Legal Risk Management Solutions LLP. Any unauthorized use, circulation or reproduction shall attract suitable action

under applicable law.


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