Guidance Note on the
Companies (Auditor's Report)
The Institute of Chartered Accountants of India
(Set up by an Act of Parliament)
© The Institute of Chartered Accountants of India.
All rights reserved. No part of this publication may be reproduced, stored in a retrieval
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recording, or otherwise, without prior permission, in writing, from the publisher.
Edition : April, 2016
Department : Auditing and Assurance Standards Board
Email : email@example.com
Website : www.icai.org
Published by : The Publication Department on behalf of the Institute of Chartered
Accountants of India, ICAI Bhawan, Post Box No. 7100, Indraprastha
Marg, New Delhi 110 002.
Printed by : Sahitya Bhawan Publications, Hospital Road, Agra 282 003.
The Ministry of Corporate Affairs has issued the Companies (Auditor's Report)
Order, 2016 (CARO 2016) which is applicable for audits of financial statements for
periods beginning on or after April 1, 2015. The CARO 2016 contains several new
reporting requirements which were not there in the earlier Orders i.e, CARO 2003
and CARO 2015. An urgent need was felt by ICAI for providing appropriate guidance
on CARO 2016 to the members so that the requirements and expectations of the
Order can be fulfilled in letter and spirit by the auditors.
I am happy that the Auditing and Assurance Standards Board has brought out this
Guidance Note on the Companies (Auditor's Report) Order, 2016 for the benefit of
the members. The Guidance Note was initially developed by three expert groups
constituted by the Board for this purpose and thereafter finalised with the contribution
of all the members of the Board and the Council. The Guidance Note has been
written in an easy to understand language and contains detailed guidance on the
various Clauses of CARO 2016 and the various issues and intricacies involved
therein. I am also happy that the Guidance Note is comprehensive and self-
contained reference document for the members.
I wish to compliment CA. Shyam Lal Agarwal, Chairman, Auditing and Assurance
Standard Board, CA. Sanjay Vasudeva, Vice-Chairman and all the members of the
Auditing and Assurance Standards Board for bringing out this highly useful Guidance
Note by putting their hard and day night efforts to provide in time for the benefit of
the members. I am sure that the members and other interested readers would find
the Guidance Note immensely useful.