Sample Working Papers to Satisfy GST Auditors

Export transactions under GST are "zero-rated," but to substantiate this treatment auditors routinely probe the correctness of documentation, place of supply, forex realisation and reconciliation between books and returns. This comprehensive guide provides sample working papers and flowcharts to help businesses prepare for GST audits efficiently.

1. Common Auditor Queries on Export Transactions

1.1 Classification & Place of Supply

Auditors will verify that supplies are correctly classified as exports and zero-rated under the appropriate IGST sections. They examine whether the place of supply is properly determined as outside the country according to statutory provisions.

1.2 Documentation Requirements

Key documents auditors examine include:

• Export invoices: Must contain specific declarations including "SUPPLY MEANT FOR EXPORT"
• Shipping bills/ARE-1: Evidence of customs clearance and export acknowledgement
• Bank Realisation Certificates: Proof of foreign currency receipt within statutory timelines

1.3 Returns Reconciliation Process

Auditors perform detailed matching between:

• Export invoices recorded in accounting books
• Supplies reported in GSTR-1
• Refund claims in GSTR-3B

2. Sample Working Papers Structure

2.1 Audit Working Paper Index

2.2 Key Working Paper Descriptions

Schedule A: Export Transactions Summary

This schedule lists all export invoices issued during the year, showing invoice date, number, customer details, value in foreign currency and INR, and nature of export (goods/service). It serves as the master index for all export transactions.

Schedule B: Export Invoice Register

A detailed register of each export invoice with cross-references to supporting documents including invoice copies, shipping bill/ARE-1 numbers, and BRC/FIRC references.

Schedule C: Reconciliation – Books vs GSTR-1

This critical schedule matches each invoice in Schedule B with corresponding GSTR-1 data, highlighting any discrepancies in values or missing invoices.

3. Best Practices for GST Audit Preparation

3.1 Documentation Standards

• Complete Documentation: Ensure all export transactions have complete supporting documents including invoices, shipping bills, and BRCs
• Proper Indexing: Maintain a clear index with page numbers for easy reference during audit
• Review Sign-offs: Each working paper should have preparer initials and reviewer sign-off with date

3.2 Reconciliation Processes

• Traceability: Ensure every figure in GST returns can be traced back to source documents
• Timeliness: Confirm compliance with foreign exchange realization timelines (9 months for services, 12 months for goods)
• Exception Reporting: Clearly highlight any discrepancies between books and returns

3.3 Special Case Handling

• SEZ Transactions: Maintain separate documentation including approval letters from Development Commissioner
• High-sea Sales: Ensure proper declarations and supporting documents are maintained
• Deemed Exports: Maintain all documents required for deemed export benefits