Society Accounting and Auditing

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Industry Challenges in Society Accounting & Auditing

Complex regulatory framework under MCS Act
Housing societies in Maharashtra must comply with the Maharashtra Co-operative Societies Act, 1960 and Model Bye-Laws 2014. Navigating these regulations requires specialized knowledge to avoid penalties and legal issues.

Strict audit timelines and reporting requirements
Societies must complete annual audits by July 31 and present them at AGM by September 30. Non-compliance can result in fines up to ₹25,000 and legal complications.

Maintenance of multiple statutory funds
Societies need to maintain various funds including Reserve Fund, Repairs Fund, Sinking Fund, and Education Fund with precise accounting and usage restrictions as per bye-laws.

Our Society Accounting & Auditing Services

1

Annual Audit of Housing Societies

Complete statutory audit as per MCS Act 1960 and Model Bye-Laws 2014. We prepare Form 1 (Balance Sheet) and Form 28 (Audit Report) with timely completion by July 31 deadline.

2

Maintenance Billing & Accounting

Accurate calculation and billing of monthly maintenance charges including property tax, water charges, common electricity, sinking fund, and service charges as per bye-law provisions.

3

Society Fund Management

Expert management of Reserve Fund, Repairs & Maintenance Fund, Sinking Fund, and Education & Training Fund with proper accounting and compliance with usage restrictions.

4

Form 10B & 10BB Filing

Specialized tax audit and return filing for charitable trusts and societies registered under Section 12A and 80G of Income Tax Act.

5

Defaulters Management & Recovery

Complete management of defaulting members including interest calculation at 21% p.a. as per Model Bye-Law 71, notice preparation, and recovery assistance.

6

AGM Preparation & Support

End-to-end support for Annual General Meeting preparation including audit report presentation, financial statement approval, and resolution documentation.

7

Rectification of Audit Objections

Assistance with rectifying audit objections within the 3-month period as per Section 82 of MCS Act, ensuring compliance and avoiding penalties.

8

Society Registration & Bye-Law Amendments

Complete assistance with new society registration, drafting of bye-laws, and amendments to existing bye-laws as per MCS Act requirements.

9

Property Tax Assessment & Appeals

Expert assistance with property tax calculations, filing of appeals against incorrect assessments, and representation before municipal authorities.

Educational Resources

Understand Maharashtra housing society regulations, audits, funds, and compliance requirements

Audit & Accounts (Maharashtra Housing Society Standards)

CA Gaurav Kumar Singh & Associates provides expert audit and accounting for housing societies as per MCS Act 1960 and Model Bye-Laws 2014, ensuring compliance and transparency.

Mar 31

Year-End Closing

Financial year ends on March 31. All accounts must be closed and prepared for audit.

Jul 31

Audit Completion

Audit must be completed within 4 months of year-end (Bye-law 151-153, Sec. 81).

3 Months

Rectification Period

Society must rectify audit objections within 3 months (Sec.82).

Sep 30

AGM Approval

Audit report must be placed before AGM for approval before September 30.

Audit Requirement Details
Appointment Rules Auditor must be from state-approved panel
Term Limit Cannot be appointed for more than 2 consecutive years
Audit Forms Form 1 (Balance Sheet) & Form 28 (Audit Report)
Penalties Fine up to ₹25,000 for non-compliance with audit requirements

Maintenance Billing Breakdown

Monthly maintenance charges are calculated based on various components as per Model Bye-Laws.

Component Description Typical Rate
Property Tax As per municipal assessment Proportionate share
Water Charges Per flat or per member consumption Meter-based or fixed
Common Electricity Lift, building lights, common areas Proportionate share
Repairs Fund Minimum 0.75% of construction cost/year As per bye-laws
Sinking Fund Minimum 0.25% of construction cost/year As per bye-laws
Service Charges Staff salaries, security, admin expenses Actuals divided
Parking Charges As per society bye-laws Fixed monthly
Interest on Defaulters 21% p.a. (as per Model Bye-Law 71) 21% annually

Society Funds Explained

Maharashtra housing societies must maintain specific funds as per the Model Bye-Laws 2014.

Fund Type Source Usage Legal Reference
Reserve Fund Surplus, donations, entrance fees Major repairs and renewals (Not refundable) Bye-Law 12
Repairs & Maintenance Fund Minimum 0.75% annual collection Daily maintenance and small repairs Bye-Law 14
Sinking Fund Minimum 0.25% annual collection Major structural work (painting, waterproofing) Bye-Law 15
Education & Training Fund ₹10 per member per month Member education, training programs Bye-Law 17

Frequently Asked Questions FAQ's

Ans. As per MCS Act 1960 and Model Bye-Laws 2014, the audit must be completed within 4 months of the financial year end (by July 31) and the audit report must be presented at the AGM before September 30.

Ans. Societies must file Form 1 (Balance Sheet) and Form 28 (Audit Report) as per the Maharashtra Co-operative Societies Act. The auditor must be from the state-approved panel.

Ans. Non-compliance with audit requirements can result in fines up to ₹25,000. Additionally, the society may face legal complications and difficulty in obtaining loans or approvals.

Ans. Societies must maintain Reserve Fund (Bye-Law 12), Repairs & Maintenance Fund (minimum 0.75% of construction cost, Bye-Law 14), Sinking Fund (minimum 0.25% of construction cost, Bye-Law 15), and Education & Training Fund (₹10 per member per month, Bye-Law 17).

Ans. As per Model Bye-Law 71, societies can charge interest at 21% per annum on outstanding maintenance dues from defaulting members.

Ans. Under Section 82 of the MCS Act, societies have 3 months to rectify audit objections raised by the auditor.