Income Tax Act 1961 requires that a business in India files their income tax returns every year. Such tax returns to be filed are accompanied by audited financial statements comprising the balance sheet and profit and loss account. The accounting profession of India is regulated by ICAI along with existing laws and regulations. The ICAI prescribes and issues accounting standards and guidelines, as well as conducts professional development programs for accountants in India.

The Indian accounting system is very robust and gives a valid framework for proper presentation and transparency in financial reporting for companies. It is expected that companies will perform their activities per the relevant laws and maintain proper records of financial transactions. Such activities boost investor confidence and promote economic growth in the country.