AI Modules/Engagement Setup/Ledger Classification

4-Dimensional Classification· सेटअप

Ledger Classification

Classify ledgers under ICAI guidelines once. Year 2 opens with zero ledgers to reclassify.

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CORAA Ledger Classification across four statutory dimensions

Every voucher in the books has four statutory consequences: which TDS section applies (192 to 206), which TCS section (206C variants), which GST nature (Normal, RCM, Composition, Exempt, Nil-rated), and which Schedule III line code (A1 Equity Capital through P9 Other Expenses). CORAA captures all four classifications in one Ledger Classification exercise. AI auto-classifies roughly 80 percent on first ingest; the auditor confirms the residual. Mappings persist year-on-year.

Four statutory dimensions in one exercise: TDS, TCS, GST, Schedule III
AI auto-classifies ~80% of ledgers on first ingest
Auditor confirms or overrides the residual 20%
One-click acceptance for AI suggestions with ≥90% confidence
Mappings persist across financial years
Rule weights adapt per client engagement

Two paths, one ledger

The old way, and ours.

Two paths to the same audit conclusion. One leaves traces; the other doesn't.

Traditional

The old way

-Auditor classifies ledgers from scratch every financial year
-TDS section, GST nature, Schedule III line maintained in separate Excel sheets
-Inconsistencies between sheets create reconciliation effort downstream
-Senior partner re-explains classification logic to article assistants annually

First audit classification: 4-6 hours of partner time. Repeats every year.

CORAA

On the Ledger

Single Ledger Classification screen captures all four dimensions
AI pre-classifies ledger names against ICAI Standards on Auditing guidance
Year 1: 30-45 minute review of AI suggestions
Year 2: typically zero ledgers requiring reclassification
Audit log preserves who classified what and when, per SA 230

Year 1 classification: under 45 minutes. Year 2 onwards: typically under 5 minutes.

How it works

Three steps. Every trace logged.

Step 01

AI pre-classifies on ingest

After the ERP data ingests, the AI reads every ledger name and narration pattern, then proposes classifications across TDS section, TCS section, GST nature, and Schedule III line. Each suggestion shows a confidence score.

Step 02

Auditor reviews and confirms

The Ledger Classification screen lists ledgers grouped by confidence band. Above 90 percent confidence: one-click accept all. Between 70 and 90 percent: review individually. Below 70 percent: requires explicit auditor classification.

Step 03

Mappings persist year-on-year

Classifications are stored against the engagement, not the year. Next year's audit opens with the same ledger names already classified. The auditor reviews only what changed: new ledgers, renamed ledgers, or ledgers where Schedule III mapping shifted.

Inside the module

What you actually get.

TDS Section dimension

Maps every applicable ledger to its TDS section under the Income Tax Act: Sec 192 Salary, 194A Interest non-bank, 194C Contractor, 194I Rent, 194JB Professional, 194Q Goods Purchase, 194R Perquisites, 206AB Non-filer higher rate. Drives Form 3CD Clause 34(a).

›Threshold checks per section
›Rate verification (10% Bldg, 2% P&M for 194I, etc.)
›Lower-deduction certificate (Sec 197) handling
›Sec 206AB non-filer flagging

TCS Section dimension

Maps sale ledgers to TCS sections under Sec 206C: 206C(1) Scrap, 206C(1F) Motor Vehicle over ₹10L, 206C(1G) Overseas remittance, 206C(1H) Sale of Goods over ₹50L buyer-wise.

›Buyer-wise cumulative threshold tracking for 206C(1H)
›Per-invoice threshold for 206C(1F)
›Form 27C zero-rate declaration handling
›Sec 206CCA non-filer higher rate

GST Nature dimension

Classifies each ledger by GST nature: Normal (ITC eligible), RCM (reverse charge), Composition (no ITC), Exempt, Nil-rated, Zero-rated (exports), Blocked (Sec 17(5)), Non-GST.

›Section 17(5) blocked credit detection
›RCM applicability per Sec 9(3) / 9(4)
›Rule 36(4) ITC limit feeds from this classification
›Used by Form 3CD Clause 44 GST-wise break-up

Schedule III Line dimension

Maps every ledger to its Schedule III line code per Companies Act 2013 Schedule III. Division I (Indian GAAP / AS) for most entities; Division II (Ind AS) for listed and large unlisted. Drives Balance Sheet, P&L, Cash Flow, Notes to Accounts, and ratios.

›~90 line codes from A1 Equity through P9 Other Expenses
›Framework selector toggles between Division I and Division II
›Current vs non-current split for amendment 2021 ageing
›Mapping tab on Schedule III WP is read-only from this classification

Frequently asked

Answers, up front.

CORAA reads ledger names, group hierarchy from the Chart of Accounts, and narration patterns from sample vouchers. It matches against a dictionary of ICAI-aligned classifications built from prior engagements and Standards on Auditing guidance. Each proposal carries a confidence score from 0 to 100. Above 90 is high-confidence; the auditor can accept all such suggestions in one click.

Mixed-purpose ledgers need split classification. CORAA flags these as 'optional GST classification' and lets the auditor either subdivide the ledger or apply GST at the voucher level rather than the ledger level. For Schedule III mapping, ledgers can split between two lines with a percentage allocation.

If the GL Code is the same and only the name changed, the classification persists by code. If a new GL Code appears, it shows up as 'unclassified' and the auditor classifies it once. The audit log captures the rename event.

See it on a real ledger

Run ledger classification on one of your engagements.

Bring a Trial Balance and a General Ledger. We'll walk through engagement setup end-to-end on your data, not a sandbox.

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