Module: | SEBI LODR & Corporate Governance Frameworks
Q18: Consider the following statements regarding the Audit Trail requirements for accounting software under the Ministry of Corporate Affairs (MCA) regulations for 2025:
1. Companies are mandated to use accounting software that records an audit trail for every transaction, capturing the date, time, and user details of any modifications.
2. The accounting software must be configured such that the audit trail feature cannot be disabled or tampered with by the management under any circumstances.
3. Under Rule 11(g), statutory auditors are formally required to comment on whether the audit trail feature was operative throughout the year and preserved for the prior period.
Which of the above statements is/are correct?
2. The accounting software must be configured such that the audit trail feature cannot be disabled or tampered with by the management under any circumstances.
3. Under Rule 11(g), statutory auditors are formally required to comment on whether the audit trail feature was operative throughout the year and preserved for the prior period.
Which of the above statements is/are correct?
✅ Correct Answer: D
🎯 Quick Answer:
D. All statements 1, 2, and 3 are correct.Structural Breakdown: Statement 1 is correct.
Statement 2 is correct.
Statement 3 is correct.
Historical/Related Context: Effective from April 1, 2023, with enhanced reporting taking hold in 2024-2025.
Causal Reasoning: Forcing a digital footprint of every financial alteration reduces the opportunity for retroactive financial manipulation.