[BREAKING] ICAI expected to Limit Tax Audits to 60 per Partner from FY 2026-2027

Big changes are coming for India’s accounting firms. In a move that’s already making waves in the finance world, the Institute of Chartered Accountants of India (ICAI) has announced a plan to put a hard cap on the number of tax audits a single partner can sign each year. Starting in the 2026-27 financial year, no partner will be allowed to sign off on more than 60 tax audits, whether working alone or as part of a team.

This decision, which was finalized at ICAI’s Central Council meeting in late May, marks a significant shift in the way tax audits are distributed among chartered accountants in the country. ICAI President Charanjot Singh Nanda summed it up: “We want every partner to have a fair share of the work and the responsibility. This isn’t just about numbers; it’s about the quality of audits and the accountability of our members.”

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Up until now, firms have been able to sidestep the individual 60-audit limit by splitting their total audit load among partners—sometimes even assigning quotas to junior partners who have little real involvement. As a result, it’s been common for a few senior partners to sign most of the audit reports, while others play a minimal role. This practice, while technically within the rules, has raised eyebrows among regulators and younger accountants who want a chance to prove themselves.

The upcoming reform aims to stop this. Under the new rule, the 60-audit cap will apply to each partner, no matter how many partners the firm has. And crucially, partners won’t be able to sign audits on behalf of others—a practice that has let some partners accumulate hundreds of sign-offs in a single year.

Also Read: Ceiling on Tax Audits in India for CharteredAccountants

ICAI says the move is not meant to punish senior partners or make life harder for big firms. Instead, it’s about making sure that every audit gets the attention it deserves—and that all partners, not just the most experienced ones, have an equal opportunity to contribute. “This is about lifting the entire profession and restoring trust in the audit process,” one ICAI council member explained.

Recent years have seen several corporate scandals in India, some linked to concerns over poor auditing. Critics say that when a small group of auditors handle an overwhelming number of audits, the quality can suffer. ICAI’s new policy hopes to address this by making audits a more balanced team effort.

There are some exceptions. Audits required by specific sections of the Income Tax Act may not count towards the new limit. ICAI is expected to clarify the details before the rules come into force.

As the clock ticks down to FY27, firms will have to adjust their strategies, reassign work, and ensure every partner is ready for their new level of responsibility. But one thing is clear: ICAI’s new rule is set to change the way tax audits are done in India—making the process more open, more equitable, and hopefully, more trustworthy for everyone involved.

The Institute of Chartered Accountants of India (ICAI) has announced a plan to put a hard cap on the number of tax audits a single partner can sign each year.