CA Alert! ICAI Imposes Cap on Tax Audits Per Partner, No Signing on Behalf of Others Allowed
The 60-audit limit will be applied to all audits carried out by each partner in their role as a partner in any firm, overall, under the proposed standards
The Institute of Chartered Accountants of India ( ICAI ) has announced a major reform in tax audit regulations, introducing a strict cap on the number of tax audits that each Chartered Accountant (CA) partner can undertake annually. With effect from the fiscal year beginning April 1, 2026, this new rule seeks to improve audit work's accountability, transparency, and...
The Institute of Chartered Accountants of India ( ICAI ) has announced a major reform in tax audit regulations, introducing a strict cap on the number of tax audits that each Chartered Accountant (CA) partner can undertake annually.
With effect from the fiscal year beginning April 1, 2026, this new rule seeks to improve audit work's accountability, transparency, and fair distribution inside organizations.
What Has Changed?
- Whether acting alone or in combination with another partner, each partner in an accounting firm will be restricted to signing no more than 60 tax audit reports annually.
- Previously used to focus audit assignments among senior partners, the latest regulations explicitly prohibit partners from signing tax audit reports on behalf of other partners. All the partners should equally contribute to the work but maintaining the cap.
- All tax audits signed by a certified public accountant in whatever capacity during the year are covered by the 60-audit cap, which is an aggregate limit.
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Formerly, partnership businesses may sign up to the total maximum of all partners, whereas individual CAs were limited to 60 tax audits annually. As a result, there was a concentration of audit assignments and possible anti-competitive behavior since senior partners were able to utilize the quotas of junior or less active partners.
For instance, a six-partner CA firm may sign up for 360 audits; in theory, a single senior partner may sign all 360 utilizing the quotas of junior or dormant colleagues.
The 60-audit limit will be applied to all audits carried out by each partner in their role as a partner in any firm, overall, under the proposed standards. The most notable of them will be the clear prohibition of signings, in which one partner signs an audit report on behalf of another.
The new rule will be enforced from April 2026 (FY 2026-27), giving firms time to adjust their internal processes and partner roles. The cap aims to promote a healthier work-life balance for CAs by preventing excessive workloads.
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