J has been appointed as Corporate Social Responsibility (CSR) Auditor for the PS Ltd. He has to guide his team regarding the methodology for CSR Audit. Give any two points in this regard. Also prepare a checklist indicat

Methodology for Corporate Social Responsibility (CSR) Audit: Review of CSR policy, CSR committee, governance structure, strategy, projects, partner identification and selection process, monitoring, evaluation and reporting. Interact with beneficiaries, project team, management and other stake holders. Review of beneficiary identification and selection process, budget allocation, outcomes monitoring and reporting. Review of CSR expenditure, project's direct expenditure, overheads and administrative expenses, traceability and genuineness of expenditure, per beneficiary cost, reasons for inability to spend 2% of profits. Checklist for Corporate Social Responsibility (CSR) provisions under the Companies Act, 2013: Check if the constitution of CSR Committee is applicable to company. If yes, whether the company has constituted CSR committee of the board consisting of three or more directors, out of which at least one director is an independent director. In case where a company is not required to appoint an Independent director under sub-section (4) of 149, it shall have in its CSR Committee two or more directors. Whether the company has CSR policy approved by the CSR Committee. Whether the CSR committee has recommended list of CSR projects or programme within the purview of schedule VII. Whether the monitoring process of such projects or programme has been established by the company. The composition of CSR committee is disclosed in the board's report. Check whether the CSR activities were under taken as per CSR policy and projects, programs or activities exclude activities undertaken in pursuance of its normal course of business. Corporate Social Responsibility committee has recommended the amount of expenditure to be incurred on the activities referred in the Corporate Social Responsibility policy. The company has instituted a transparent monitoring mechanism for implementation of the CSR projects or programs or activities undertaken by the company. The company has disclosed the contents of the policy in board's report and at its website, if any. The board's report includes an annual report on CSR containing prescribed particulars. In case the company does not spend the specified amount (i.e. at least two percent of the average net profits made during the three immediately preceding financial years), Board's report specifies the reason for not spending the amount. Check if the net profits of the company are in accordance with the provisions section 198 of the Companies Act, 2013 or not. In case the company has built CSR capacities of their own personnel, check whether the expenditure including expenditure on administrative overheads shall not exceed five percent of total CSR expenditure of the company in one financial year. The company has complied with all other requirement of the CSR Rules.