CSEET · Fundamentals of Accounting · Introduction to Company Accounts
Under section 130 of the Companies Act, 2013 as given, an order to re-open books of account cannot relate to a period earlier than how many financial years immediately preceding the current financial year (ignoring any longer period directed by the Central Government)?
The limit is eight financial years immediately preceding the current financial year. Under section 130(3), no re-opening order can cover an earlier period, unless the Central Government has directed a longer retention period for books of account.
- AEightCorrect
- BFive
- CTen
- DThree
Explanation
Section 130(3) says no order can be made for books relating to a period earlier than eight financial years immediately preceding the current financial year. A longer period applies only where the Central Government has directed longer retention under section 128(5) proviso.
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