KK Pvt. Ltd. was formed in the year 2016 with a paid-up capital of ₹ 2 crore. The company is manufacturing solar panel and other electronic parts and supply to the public sector company. In the year 2020, the company rai

The concept of the Internal Audit has been recognized as a statutory exercise under Section 138 of the Companies Act, 2013 and has been made mandatory. As per Rule 13 of Companies (Accounts) Rule, 2014 every private company having: Turnover of two hundred crores rupees or more during the preceding financial year; or Outstanding loans or borrowings from banks or public financial institutions exceeding one hundred crores rupees or more at any point of time during the preceding financial year. Shall be required to appoint an Internal Auditor who may be either an individual or a partnership firm or a body corporate. In the case of KK Pvt. Ltd., the turnover was of ₹180 crore and total outstanding loan was to the tune of ₹110 crore (i.e. 50 crore + 60 crore) during the financial year 2021 -22. As the KK Pvt. Ltd. is having outstanding loan exceeding the limit of ₹100 crore during the year 2021-22 therefore the contention of D is correct and a company is required to go for Internal Audit for the year 2022-23 which might be conducted by appointed an Internal Auditor who might be either an individual or a partnership firm or a body corporate.