Disclaimer - The following constitutes Intuit’s recommendation based on generally accepted practices, and is not to be treated as advice for compliance or legal purposes. Please consult your financial advisor/Chartered Accountant before implementing it for your business.
In India, the Companies Act mentions rules where the books of accounts or other relevant documents are maintained in electronic form.
Rule 3 of Companies Rules 2014 states that:
- The and other relevant books and papers maintained in electronic mode so as to be usable for subsequent reference.
- The books of account and other relevant books and papers referred to in sub-rule (1) shall be retained completely in the format in which they were originally generated, sent or received, or in a format which shall present accurately the information generated, sent or received and the information contained in the electronic records shall remain complete and unaltered.
- The information received from branch offices shall not be altered and shall be kept in a manner where it shall depict what was originally received from the branches.
- The of the document shall be capable of being .
- There shall be a proper system for storage, retrieval, display or printout of the electronic records as the Audit Committee, if any, or the Board may deem appropriate and such records shall not be disposed of or rendered unusable, unless permitted by law: and other books and papers of the company maintained in electronic mode, including at a place outside India, if any, .
- The company shall intimate to the Registrar on an annual basis at the time of filing of financial statement-
- the name of the service provider;
- the internet protocol address of service provider;
- the location of the service provider (wherever applicable);
- where the books of account and other books and papers are maintained on cloud, such address as provided by the service provider.
The above rules can be interpreted as having the books of accounts presented/displayed in a legible form even though they are stored in electronic form, e.g. in proprietary formats by QuickBooks or any other service provider. Data backup maintained in Excel format should be acceptable as per the above rules and can be construed as backup.
We would recommend that you make Excel copies of the following reports periodically (say, once a month/once a quarter and annually)
- Balance Sheet
- Profit and Loss Statement
- General Ledger
- Cash Flow Statement
- Trial Balance
- Transaction Detail by Account (All Dates & Current Financial Year)
QuickBooks can schedule and e-mail these reports to you so that you can file them away once received.
See this FAQ about scheduling reports. Memorised Reports
The requirements as per the Act as well as the AOC 4 form is that the data be located in a server in India. Having the above set of files locally on your office computer or server allows compliance as the Act does not make a distinction between a data server and a file server.
To comply with address that the rules and AOC 4 form ask for, please do note that the address being asked for is that of the service provider and not that of the data servers. You may use the address from the following page - http://www.intuit.com/company/contact/
For more information on the Companies Act, please see