The short answer: An Indian CA can audit a US subsidiary’s accounts for India’s APR under a special purpose audit (SA 800), because the APR rules do not name the auditor’s nationality. But US state accountancy laws reserve audit reports on financial statements to licensed CPAs and registered firms. AD banks also increasingly ask for wording a CA cannot give: that the auditor is authorized under host-country law. For a controlled US subsidiary, the route that holds up is a US CPA audit, with the Indian CA certifying the APR and handling the bank filing.
Can an Indian CA audit a US company? It is the question CFOs ask most often when the APR, or Annual Performance Report, comes due for their US subsidiary. Their CA already audits the Indian parent, knows the group and costs less. Using the same firm for the US company feels like the obvious choice.
The answer has two halves: what Indian rules allow, and what US law and Indian banks will accept. In our APR audits for US subsidiaries of Indian companies, we work alongside the Indian CA on almost every file. The split of work matters far more than the choice of one firm over the other.
This guide sets out both routes fairly, explains what banks are now asking for, and shows how the two firms can share the work.
Key Takeaways
- An Indian CA can audit a US company’s accounts for India’s purposes under SA 800, but cannot sign a US audit report.
- US state accountancy laws reserve audit reports on financial statements to licensed CPAs and registered firms.
- India’s APR rules require audited statements for a controlled subsidiary but do not say who the auditor must be.
- Some AD banks now ask the auditor to confirm host-country authorization, which an Indian CA cannot truthfully state.
- Where the investor has no control, the Indian CA can certify unaudited statements, and no US audit is needed.
- The workable split is a US CPA audit of the US company, with the Indian CA certifying the APR and filing it.
Can an Indian CA Audit a US Company for the APR?
Yes for India’s purposes, but not as a US audit. The APR has to rest on audited financial statements when the Indian investor controls the foreign company. India’s Overseas Investment Regulations, 2022 set that rule but do not say the auditor must belong to any country. So an Indian CA can audit the US company’s accounts and issue a report that India recognizes.
What the CA cannot do is act as a US auditor. The report will be an Indian special purpose report, not an audit report under US standards. Whether that is enough now depends far more on your AD bank (the Indian bank that handles your foreign remittances) than on the rules themselves.
What Does US Law Say About Who Can Sign an Audit Report?
US law leaves accountancy to the states, and every state limits who can issue an audit report. Most state laws follow the Uniform Accountancy Act, a model law written by the AICPA and the National Association of State Boards of Accountancy (NASBA). Under these laws, only licensed CPAs and registered CPA firms can issue reports on the financial statements of others.
New Hampshire’s statute is a clear example. RSA 309-B:14 says only licensees and permitted firms “may issue a report on financial statements of any other person, firm, organization, or governmental unit.” It does exempt holders of foreign qualifications, but only if they perform no attest services and issue no such reports for entities in the state.
Attest services are engagements that give assurance on someone else’s numbers, such as audits and reviews. So an Indian CA, however qualified, has no standing to sign an audit of a US company under US rules. A licensed US CPA firm does.
What Is an SA 800 Special Purpose Audit, and Where Does It Fit?
SA 800 is the Indian auditing standard for audits of financial statements prepared for a special purpose, issued by the Institute of Chartered Accountants of India (ICAI). An Indian CA uses it to audit a foreign company’s accounts for a specific Indian use, such as the APR. The report says plainly that it is for that purpose only.
SA 800 fits best where the stakes are lower. If the Indian investor has no control and the host country does not require an audit, the APR can rest on unaudited statements certified by the Indian CA anyway. In that case no US audit is needed, and the CA’s work is the natural choice.
It fits less well for a controlled subsidiary. There, banks want comfort that the audit is valid where the company actually operates, and an SA 800 report cannot give it.
Has your bank asked for host-country authorization wording on your APR audit?
We audit US subsidiaries of Indian companies under AICPA standards, as a licensed US CPA firm, and issue a report your AD bank can accept without that question. Your Indian CA stays on the file for the APR certificate and the bank filing.
What Are AD Banks Asking For Now?
AD banks are asking for more than an audit report. Under the 2022 framework, banks set their own operating procedures for overseas investment reporting, and many have tightened them. The clearest example is wording about the auditor’s authority in the host country.
In a December 2025 discussion on an Indian practitioner forum, a CA described a private bank insisting the SA 800 report state the auditor was “allowed to audit the foreign entity as per the host country regulations.” Practitioners replying agreed the CA should not sign that line. It would be untrue, and it would breach professional standards. They suggested explaining the SA 800 basis to the bank and asking management or local counsel to address the host-country point instead.
Beyond that wording, banks commonly look for:
- An auditor licensed in the host country, named with the firm’s details in the signature block.
- Statements under host-country GAAP, which for a US subsidiary means US generally accepted accounting principles.
- A clean audit opinion, with no unresolved limitation on scope.
- APR figures that match the audited statements exactly, after conversion into rupees.
US CPA vs Indian CA: How Do the Two Routes Compare?
The two routes differ on who signs, which standards apply and how a bank will read the result. The table compares them for a controlled US subsidiary:
| Factor | US CPA audit | Indian CA audit (SA 800) |
|---|---|---|
| Who signs | Licensed US CPA firm | Indian CA firm |
| Auditing standards | AICPA (GAAS) | ICAI (SA 800) |
| Valid as a US audit | Yes | No |
| Host-country wording | Can be given | Cannot be given |
| Usable by US lenders or investors | Yes | Rarely |
| Usable for Indian consolidation | Yes, with the Indian auditor's review | Yes |
The Indian CA route still has a clear place: the no-control case, and banks that accept the SA 800 basis without extra wording. For a wholly owned subsidiary, though, the US audit removes the question before the bank can ask it. For more on when the audit is required at all, see our guide to whether your US subsidiary needs an audit for the APR.
A Worked Example: What a December Rejection Costs
A bank query in December is the most expensive way to discover which route your bank prefers. The example below shows why.
The situation
A Chennai-based engineering company owns 100% of a Texas corporation with a calendar year. Its Indian CA audits the US company’s 2025 accounts under SA 800 and submits the APR on December 10, 2026. The AD bank replies asking for confirmation that the auditor is authorized under US law.
The arithmetic
The company now needs a US CPA audit, and the calendar is short:
| Step | Time needed | Earliest finish |
|---|---|---|
| Engage a US CPA, share the records | 3 working days | December 15 |
| US audit fieldwork, records already prepared | 8 to 10 working days | December 29 |
| Revised APR and bank review | About 3 weeks | Mid-January 2027 |
Even with every record ready, the APR lands about two weeks after the December 31 due date. It becomes a late filing, with a late submission fee of Rs 7,500, as our guide to the APR late submission fee explains.
The fee is the small part. Until the late APR is regularized, the company cannot send fresh capital or loans to its Texas subsidiary. If the US business needs funding in January, that money waits.
Want to avoid a December rejection like this one?
Book a 30-minute call with a US CPA. We will look at your structure, your bank’s recent requests and your timeline, and tell you whether a US audit is needed and how to fit it around your CA’s work.
The Route That Works for Both Firms: US Audit, Indian Certification
The cleanest answer is to split the work by country. The US CPA audits the US company, and the Indian CA keeps everything on the Indian side. Each firm does what its license allows, and neither loses the client.
| US CPA firm | Indian CA firm |
|---|---|
| Audits the US company under AICPA standards | Certifies the APR and converts figures into rupees |
| Issues the US audit report | Files the APR with the AD bank and answers queries |
| Confirms intercompany balances with the parent | Files the parent's FLA return with the RBI |
| Answers the Indian auditor's questions | Consolidates the US subsidiary into group accounts |
For consolidation, the Indian auditor can use the US audit under SA 600 (Using the Work of Another Auditor), the Indian standard for relying on another firm’s work. The APR filing process with your AD bank then runs on audited figures that no bank will question.
This is also why many Indian CA firms now refer their clients’ US audits rather than attempt them. The CA keeps the relationship, the certificate and the filing. The client gets an audit that stands up on both sides.
Indian CA vs US CPA Audit FAQs
1. Can an Indian CA audit a US company?
An Indian CA can audit a US company’s accounts for an Indian purpose, such as the APR, under SA 800. But only a licensed US CPA firm can issue an audit report that is valid under US state law.
2. Is an SA 800 audit accepted for the APR?
Some AD banks accept it, especially where the investor has no control. Others now ask for host-country authorization wording, which an SA 800 report cannot include.
3. Does the RBI say who must audit a foreign subsidiary?
No. The APR rules require audited statements for a controlled foreign company but do not name the auditor’s nationality. In practice, the AD bank decides what it will accept.
4. Can an Indian CA sign a US audit report if it is only used in India?
The CA can sign an Indian special purpose report. It is not a US audit report, and state laws reserve reports on financial statements of others to licensed CPAs and registered firms.
5. What does "host-country authorization" mean on an APR audit?
It means confirming the auditor is allowed to audit the company under the law of the country where it operates. For a US company, a licensed US CPA firm can confirm this. An Indian CA cannot.
6. Can my Indian auditor rely on a US CPA's audit for consolidation?
Yes. The Indian auditor can use the US audit under SA 600, reviewing the US firm’s work as needed, and consolidate the subsidiary into the group accounts.
7. Who certifies the APR if a US CPA does the audit?
The Indian investor’s statutory auditor or a practicing CA certifies the APR, using the audited US figures. The authorized signatory then files it through the AD bank.
8. Do I need a US CPA if my stake has no control?
Usually not. With no control and no US audit requirement, the APR can use unaudited statements certified by your Indian auditor or CA.
Conclusion: Can an Indian CA Audit a US Company? The Practical Answer
An Indian CA can audit a US company’s accounts for India’s APR, but only as an Indian special purpose audit, not a US audit. US state law reserves audit reports to licensed CPAs, and AD banks increasingly want proof the auditor is authorized where the company operates. For a controlled US subsidiary, a US CPA audit removes that risk. Your Indian CA still certifies the APR, files it and consolidates the group.
- Check your control position first, because no-control stakes may need no US audit.
- Ask your AD bank now what audit wording it expects this year.
- Book the US audit early so a bank query never lands in December.
- Keep your Indian CA on the APR certificate, the filing and the consolidation.
Split the work by country, and both firms do what they do best.
Ready to set up the US audit and keep your CA on the APR?
Tell us about your US subsidiary and introduce us to your CA. We will send a fixed-fee proposal for the US audit, agree the report date with your CA, and share the records list.
Parth Shah, Managing Director
(CPA-US, FCA, RV-S&FA, DISA)
Parth Shah who is head of Accounts and Book keeping has experience of more than 10 years. A Certified Public Accountant – US, fellow Chartered Accountant, Registered Valuer and Diploma in Information System Audit.
