Confirming that the turnover as per the books of accounts aligns with the turnover disclosed on the GST portal is a crucial part of the GST audit process. This step ensures that the taxpayer is accurately reporting their sales and taxes to both the tax authorities and the GST portal, preventing discrepancies that could lead to penalties.

Here are the steps to verify that the turnover in the books is consistent with the turnover disclosed on the GST portal:

1. Gather Necessary Documents:

• Books of Accounts: Sales register, invoices, financial statements (Profit & Loss account, Balance Sheet).
• GST Returns: GSTR-1 (outward supply) and GSTR-3B (summary of outward and inward supplies).
• Annual Return: GSTR-9 for the financial year.
• GST Portal Data: Data from the GST portal, specifically the GSTR-1 and GSTR-3B returns.

2. Verify Turnover in the Books of Accounts:

• Sales Register: Review the sales register or sales day book for the financial year. Ensure all invoices (both taxable and exempt) are recorded.
• Profit and Loss Account: Check the total sales or revenue from operations as per the Profit & Loss Account of the business.
• Taxable Turnover: Ensure that the taxable turnover, exempt turnover, and export turnover (if applicable) are properly segregated in the books of accounts.

3. Check the Turnover Disclosed in GST Returns:

• GSTR-1 (Outward Supply): Verify that the turnover reported in GSTR-1 matches the sales recorded in the books. Ensure that the total value of outward supplies is consistent, including the bifurcation of taxable, exempt, and zero-rated supplies.
  • Check whether all sales invoices have been included.
  • Compare the turnover in GSTR-1 with the total sales in the books of accounts.
• GSTR-3B (Summary Return): The GSTR-3B return reflects the net taxable turnover and tax payable. Ensure that the turnover in GSTR-3B matches the turnover in the books.
  • Compare the output tax liability with the taxes calculated in the Profit & Loss account.
• GSTR-9 (Annual Return): The annual return (GSTR-9) should aggregate the values of GSTR-1 and GSTR-3B for the full year. Ensure that the turnover disclosed in GSTR-9 aligns with the turnover from the books of accounts.

4. Reconciliation of Turnover:

• Compare Gross Sales: Compare the gross turnover (sales) recorded in the books of accounts with the turnover reported in GSTR-1.
• Adjustment for Exemptions and Discounts: Make adjustments for any exempt supplies or discounts that may have been provided.
• Verify Export and Zero-rated Supplies: Ensure that export sales or zero-rated supplies, if applicable, are correctly excluded from the taxable turnover but are reported separately.
• GST Portal Data Match: Access the GST portal and download the GSTR-1 data. Check that the total turnover (including the total value of taxable supplies) reported on the portal matches the turnover in your financial records.

5. Check for Missing Invoices:

• Ensure that no invoices are missing in the GST returns that were included in the books. If there are discrepancies, it may indicate unreported sales.

6. Verify Adjustments for Credit Notes/Debit Notes:

• Ensure that any credit notes or debit notes issued during the year are properly reflected in the GST returns (GSTR-1 and GSTR-3B). These adjustments should also be factored into the reconciliation process.

7. Examine Accounting Errors:

• Ensure that accounting errors, such as misclassifications, incorrect recording of sales, or omissions, are corrected before filing the GST returns.
• Ensure the treatment of turnover is consistent throughout the year, and adjustments for the previous year (if applicable) are recorded accurately.

8. Final Confirmation and Reporting:

• Once the reconciliation is complete, ensure that the turnover as per the books matches the turnover disclosed on the GST portal.
• Any discrepancies between the books and the GST portal need to be explained and rectified. If there is a mismatch, further investigation should be done to identify the reason (e.g., missing invoices, reporting errors, unreported sales).
• GSTR-9C (Reconciliation Statement): Prepare and file the reconciliation statement (GSTR-9C) if applicable. This statement will reflect any differences between the turnover as per the books and the turnover reported in the GST returns.

Key Areas to Focus On:

• Sales Returns: Check that sales returns (if any) are recorded correctly in both books and returns.
• GST Portal Data: Sometimes, there can be a delay in updating the data on the GST portal, so always ensure that the data is final and accurate.
• Consistency: Ensure consistency in the treatment of exempt supplies, non-taxable supplies, and zero-rated supplies across all documents.
• Non-GST Supplies: Make sure any supplies that fall outside the GST regime (such as those exempt from GST) are appropriately identified and not included in the taxable turnover.