Audit and certification under RERA

1. Audit and certificationunder RERA S R L & Co. Chartered Accountants Vadodara CA.Lalit Raithatha CA. Rachit SomaniCA. Sakshi SomaniAddress: A/14, 4th Floor, Earth Artica, Vasna Bhayli Road, Vadodara Phone:07487888555

2. Penal Action - GUJARAT REAL ESTATE REGULATORY AUTHORITY (GENERAL) REGULATIONS, 2017 • Rule 4 : Explanation 2: If the Form 5 issued by the statutory auditor reveals that any certificate issued by the project architect, engineer or the chartered accountant has false or incorrect information and the amounts collected for a particular project have not been utilized for the project and the withdrawal has not been in compliance with the proportion to the percentage of completion of the project, the Authority, in addition to taking penal actions as contemplated in the Act and the Rules, shall also take up the matter with the concerned regulatory body of the said professionals of the architect, engineer or chartered accountant, for necessary penal action against them, including cancellation of registration of membership for practice as such. Displaying of plans etc., • Refer case of Ratanben H Patel CMP/Ahmedabad/180920/0130 of Gujarat RERA - Matter refer to ICAI

3. FORM 3 • Quarterly Return filling and at the time of Registration • Certification is governed by guidelines issued by ICAI – Certificates and audit under RERA • Guidance note on reports or certificates for special purposes (Revised 2016) • Using the Work of Expert – Auditing Standard

4. Sequence of Certificate • Form 1 and Form 2 to be certified by Professionals • To get the unaudited books from Client • Review the data and make sure that it is not materially misstated • Check the progress reported in Form 1 and Form 2 • Management representation to include the below points • Budget and Actual Expenses • Declaration that We have relied on unaudited number • Declaration of Form 1 and Form 2 data and required information has been given to professional • Having all required permission to carry out the construction activity • Numbers are unaudited and not materially misstated • Declaration for unsecured loans if any

5. Other Documentation and Checking • Bank balance of all bank accounts should match with Bank statement • Signed bank statement, Profit and Loss Account and Balance Sheet • Signed area sheet and Budgeted price of Units • Advance received as per Form 3 and Books should match – Difference should be documented • Test check with Agreement to sale • Should compare the opening balance of every year with audited books or with income tax return to verify

6. Form 5 • Form 5 Required to be submitted with in 6 month of completion of Financial year • Required to be submitted by every promoter along with audited accounts • If accounts are not required to be audited under any other Act – Audit is required for RERA purpose. • Form 3 and Form need to be signed by different professional

7. Form 5 • Whether Separate RERA bank account has been opened as envisaged in Gujarat RERA Bank Account Direction,2018? • Whether existing operational Bank Account was made known at the time of application for registration as RERA bank Account? • Details of RERA Bank account as registered with Gujarat RERA – Mention all the bank accounts if there has been a change in bank account registered with RERA • In case change in RERA Account, whether approval is taken form RERA Authority? • Whether any of the form 3 issued during the certificate period mandated deposit of 100% of the money collected from the booking of the project units? • If yes then report Name of professional and certificate date

8. Form 5 • Whether the required proportion of money collected from the allottes deposited in RERA account? • No then Report amount deposited other than RERA account • In case of new project registration, whether there was any booking taken prior to project registration ?– Report number of units, Amount Collected and sales price of such units. • Whether all amounts withdraw from RERA bank account were within the withdrawal limit as certified under the relevant form 3 issued during the reporting period? – if no then report Period and Excess amount withdrawn • Whether fixed deposit was created out of funds created out of funds deposited in RERA bank account? – Whether any lien is created on such fixed deposits?

9. Form 5 • Whether there has been any instance of receipt of consideration in excess of 10% of apartment value without entering into a registered agreement for sale? – Provide unit number, total consideration and amount received in excess of 10%? • Whether the project is executed by availing any loans/borrowings? – Name of lender, Amount of Loan sanction, Sanction date, Loan outstanding…………..,Collateral Mortgage security. • If yes to above ,whether promoter has mortgaged or created a charge on any booked unit? • Whether any discrepancy noticed in forms 1,2 and 3 with reference to their issuance in accordance with the RERA act, rules and regulations? • Any other things not covered elsewhere