Statutory Audit for LLP in India: Turnover Limits, Applicability, Penalties & Audit Cost (2026)

The Limited Liability Partnership (LLP) structure has become one of the fastest-growing business formats in India, especially among professional firms, consultants, startups, and family-managed enterprises.

However, one compliance question continues to create confusion for LLP owners every year:

Is statutory audit mandatory for an LLP in India?

For FY 2025–26 (AY 2026–27), statutory audit enforcement has become increasingly data-driven, with MCA filings, GST returns, and banking records being cross-verified. As a result, non-compliance is now far easier to detect than earlier.

This guide explains, in a clear and practical manner:

• When statutory audit applies to LLPs

• Turnover and contribution thresholds

• Penalties for non-compliance

• Audit cost for LLPs in India

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What Is a Statutory Audit for an LLP?

A statutory audit is a legally mandated audit of financial statements, conducted under the provisions of the LLP Act, 2008.

The objective of a statutory audit is to:

• Verify that the books of accounts present a true and fair view

• Ensure financial transparency for partners and regulators

• Align financial statements with MCA filings and tax records

Important:
Not every LLP is required to undergo a statutory audit. The obligation arises only when specific thresholds are crossed.

Statutory Audit Applicability for LLPs (FY 2025–26)

An LLP is required to conduct a statutory audit if any one of the following conditions is met:

1. Turnover Threshold

• Annual turnover exceeds ₹40,00,000 (₹40 lakh)

2. Partner Contribution Threshold

• Total partner contribution exceeds ₹25,00,000 (₹25 lakh)

If either of the above limits is crossed during the financial year, statutory audit becomes mandatory.

Compliance insight:
MCA statistics indicate that approximately 65–70% of LLPs fall within the audit-exempt category. However, LLPs registered under GST or engaged in regular commercial activity have a much higher audit trigger rate, often exceeding 45%.

Statutory Audit Due Dates for LLPs (2026)

Delays can result in:

• Late filing fees

• MCA compliance flags

• Increased risk of future scrutiny

Penalties for Not Conducting Statutory Audit in an LLP

Failure to conduct a statutory audit when applicable attracts penalties under the LLP Act, 2008.

Penalty Range

• Minimum penalty: ₹25,000

• Maximum penalty: ₹5,00,000

Penalties may be imposed on:

• The LLP entity, and

• Designated partners individually

Practical exposure observed:

• First-time or small LLP defaults: ₹25,000 – ₹1,00,000

• Repeated or serious defaults: ₹2,00,000 or more

Statutory Audit Cost for LLPs in India (2026)

There is no fixed statutory audit fee for LLPs. Audit costs vary based on size, complexity, and compliance history.

Indicative Audit Fee Ranges

Factors Affecting Audit Fees

• Volume and complexity of transactions

• GST registrations and reconciliations

• Multi-state operations

• Prior-year non-compliance or gaps

Choosing an audit solely on the basis of lowest cost often increases long-term compliance risk.

LLP Audit vs Audit Exemption: A Common Mistake

Many LLPs assume that statutory audit is not required because:

• Turnover is below ₹40 lakh

However, they overlook the partner contribution threshold, which may already exceed ₹25 lakh.

Outcome:
Audit not conducted → Incorrect Form 8 filing → MCA notice risk.

Audit applicability for LLPs must therefore be evaluated using both turnover and contribution criteria, not turnover alone.

How to Choose the Right Audit Firm for an LLP

A statutory audit is not merely a filing requirement; it is a risk-management and compliance safeguard.

When selecting an audit firm, LLPs should assess:

• Specific experience in LLP audits (not only companies)

• Ability to reconcile MCA, GST, and income-tax data

• Post-audit support, including Form 8 filing and query handling

Selecting an auditor purely on pricing often leads to compliance gaps later.

Why Professional Audit Advisory Matters for LLPs in 2026

In 2026, LLP audits are increasingly influenced by:

• Automated MCA scrutiny

• GST and income-tax data matching

• Audit report requirements for bank financing

As a result, LLPs are shifting towards proactive audit planning rather than reactive compliance.

This trend directly contributes to the growing demand for auditing services in India.

Need Help With LLP Audit Applicability or Cost?

If you are uncertain about:

• Whether your LLP is subject to statutory audit

• Your actual audit cost exposure

• Potential penalty risks

A professional review can clarify these aspects efficiently and help prevent avoidable compliance issues.

Conclusion: LLP Statutory Audit Is Threshold-Driven, Not Optional

Statutory audit for LLPs in India is not discretionary. Once the prescribed thresholds are crossed, audit becomes mandatory and enforceable.

LLPs that:

• Monitor applicability in advance

• Budget audit costs correctly

• Engage experienced audit professionals

are far better positioned to maintain long-term compliance with minimal regulatory risk.