Housing Society Audit Checklist — Maintenance, Sinking Fund, Transfers

The co-operative housing society audit in one programme: member dues and maintenance billing, sinking and repair funds at bye-law rates, transfer premium caps, property-tax pass-through, statutory timelines, and the mutuality/80P income-tax position — editable in Word.

Free · CORAA original — SA-aligned

Updated 29 Jul 2026

Framework

State Co-op Act + registered model bye-laws

Sinking fund

Min 0.25% p.a. of construction cost (Maharashtra model)

Repair fund

Min 0.75% p.a. of construction cost (Maharashtra model)

Tax position

Mutuality for member dues · 80P on co-op bank interest

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Your firm — letterhead

Appears at the top of the document as the audit firm letterhead.

Audit firm name

Audit firm address

Used as the letterhead block.

Engagement partner

ICAI membership no.

Firm registration no.(optional)

Engagement details

The client and period this document is for.

Name of society

Registration number

Governing State Co-operative Societies Act

Co-operative law is state law — every threshold in this checklist must be read against this Act and the society's registered bye-laws.

Year ended

The co-operative year this audit covers, e.g. 31 March 2026.

Date of preparation

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Housing Society Audit Checklist — Maintenance, Sinking Fund, Transfers

31 July 2026

HOUSING SOCIETY AUDIT CHECKLIST

Society: {{client_name}} · Registration no.: {{society_reg_no}} · Governing Act: {{state_act}} · Year ended: {{period_end}} · Prepared by: __________ · Reviewed by: __________

Framework note: a co-operative housing society is governed by its State Co-operative Societies Act and its REGISTERED bye-laws. The fund percentages and premium caps below follow the Maharashtra model bye-laws because they are the most widely copied pattern — a society's own registered bye-laws (and its State Act) always override them. Verify each rate against the bye-laws on record before testing.

Part A — Member dues and maintenance billing

Item	Tested (Y/N)	Observation
Maintenance bills raised for every flat/unit for every billing period; billing register agrees with the member ledger
Charge heads split per bye-laws (service charges divided equally per flat; area-linked heads like repair/sinking funds on area or cost, as the bye-laws direct)
Member-wise dues ageing prepared; interest on arrears charged at the bye-law rate (simple interest, capped — verify the rate in the registered bye-laws)
Recovery action for long-outstanding dues per the State Act (e.g. recovery-certificate route where available)
Non-occupancy charges, where levied, within the limit the State/bye-laws set (in Maharashtra, capped at 10% of service charges by government order — verify current position)

Part B — Sinking fund and repair fund

Fund	Common bye-law norm (verify against registered bye-laws)	Collection tested (Y/N)	Utilisation tested (Y/N)
Sinking fund	Minimum 0.25% per annum of the construction cost of each flat (architect-certified cost, excluding land) under the Maharashtra model bye-laws — rate is bye-law-dependent
Repairs and maintenance fund	Minimum 0.75% per annum of the construction cost of each flat under the Maharashtra model bye-laws — rate is bye-law-dependent
Major repairs fund	As fixed by the general body when levied

☐ Sinking fund invested/kept in the mode the Act/bye-laws require and NOT used for routine expenses; utilisation (if any) backed by general-body approval.
☐ Fund balances disclosed separately in the balance sheet, with matching earmarked investments where required.

Part C — Transfer of flats and premium

☐ Transfers during the year supported by transfer applications, committee approval and updated share certificates.
☐ Transfer premium charged within the cap in the registered bye-laws — the Maharashtra model bye-laws cap it at ₹25,000; other states / bye-laws differ, so verify the applicable cap. Amounts collected beyond the cap under other labels ('voluntary donation' on transfer) are a classic audit red flag.
☐ No premium charged on transfers within the family / to nominees where the bye-laws exempt them.

Part D — Property tax, utilities and pass-through charges

☐ Municipal property tax billed to members matches the demand received from the municipal body (pure pass-through — no margin retained).
☐ Water and common-electricity charges allocated per bye-laws; recovery reconciles with the amounts paid to the utility.
☐ Statutory dues (property tax, water) paid on time; interest/penalty for late payment, if any, reported to the general body.

Part E — Statutory timelines under the State Act

Requirement	Complied (Y/N)	Observation
Statutory audit completed within the period the State Act prescribes from year-end (e.g. four months in Maharashtra — verify under {{state_act}})
Auditor appointment per the State Act (panel auditor / general-body appointment)
AGM held by the statutory deadline; audited accounts adopted
Annual returns and audit report submitted to the Registrar within the prescribed period
Previous year's audit rectification report filed; open defects tracked

Part F — Income-tax position

☐ Mutuality: contributions from members (maintenance, repair/sinking-fund collections, member charges) are generally outside the tax net on the principle of mutuality — but income from NON-members (mobile-tower rent, hoardings, open-space rent to outsiders) and interest from banks is taxable.
☐ Interest from CO-OPERATIVE banks: deduction under Sec 80P(2)(d) is widely claimed and has substantial judicial support, but the position has been litigated since Sec 80P(4) was introduced — check the current view of the jurisdictional High Court before signing the computation. Interest from scheduled/nationalised banks is taxable (Totgars line of cases).
☐ General deduction under Sec 80P(2)(c) (a small fixed amount for societies not covered by other clauses) claimed where eligible — verify the current limit.
☐ Return of income filed where taxable income exists; TDS on contractor/professional payments (Sec 194C/194J) and on interest received reconciled with Form 26AS/AIS.

Part G — Conclusion

Overall conclusion, including fund-collection compliance and open rectification items: ____________________________________________

Prepared by	Reviewed by	Engagement partner

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What’s inside

An excerpt from the template.

HOUSING SOCIETY AUDIT CHECKLIST

Society: ___ · Registration no.: ___ · Governing Act: ___ · Year ended: ___ · Prepared by: __________ · Reviewed by: __________

Part A — Member dues and maintenance billing

↑ Excerpt only — the full template is what you download as Word

About this template

What you’re downloading, and when to use it.

This template follows the format published by the Institute of Chartered Accountants of India (ICAI) in the AASB Audit Working Paper Templates (June 2023), the authoritative reference for Indian statutory-audit documentation. Fill in your firm’s letterhead and the engagement details on the form above, click Download Word file, and you’ll get a fully formatted .docx ready to use.

Everything is generated in your browser and on a stateless API endpoint — no account, nothing stored on our servers. We’ll ask for a work email once before your first download so we can send you the file and the occasional relevant update; after that, downloads on this device are instant. Edit freely in Word, Google Docs or Pages before sending to your client.

Common questions

FAQs.

How are the sinking fund and repair fund calculated?

Under the Maharashtra model bye-laws — the pattern most states' societies copy — the sinking fund is collected at a minimum of 0.25% per annum of the construction cost of each flat (as certified by the architect, excluding the proportionate land cost) and the repairs and maintenance fund at a minimum of 0.75% per annum of the same base. The general body may fix higher rates. Both figures are bye-law norms, not all-India statute: a society's own registered bye-laws and its State Act govern, so verify the rates on record before testing collections.

Is there a cap on transfer premium when a flat is sold?

In Maharashtra the model bye-laws cap the premium a society may charge on transfer of a flat at ₹25,000; caps and mechanics differ in other states and under individual registered bye-laws, so check the documents that actually bind the society. The recurring audit issue is amounts collected beyond the cap dressed up as 'voluntary donations' from the transferor or transferee at the time of transfer — the auditor should flag any receipt that is voluntary in name but coincides with a transfer.

Does a housing society pay income tax?

Contributions from members — maintenance, repair and sinking-fund collections — are generally not taxable on the principle of mutuality (contributors and beneficiaries are the same class). Income from outside that circle is taxable: mobile-tower and hoarding rent, amounts from non-members, and bank interest. Interest earned from co-operative banks is widely claimed as deductible under Section 80P(2)(d); the claim has substantial judicial support but has been litigated since Section 80P(4) arrived, so check the jurisdictional High Court's current view. Interest from scheduled banks is taxable under the Totgars line of cases. A society with taxable income must file a return of income.

When must a housing society's audit be completed?

Within the period its State Act prescribes from the close of the co-operative year — in Maharashtra the statutory audit is to be completed within four months of year-end by an auditor from the Registrar's panel, and the audited accounts go before the AGM held by the statutory deadline. Deadlines, panel requirements and AGM timing differ by state, which is why this checklist carries a timeline table to be filled against the applicable Act rather than fixed dates.

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