An e-invoicing and QR code compliance audit confirms the entity's aggregate turnover brings it within the current e-invoicing applicability threshold, tests a sample of outward tax invoices across the year to confirm each carries a valid Invoice Reference Number and the corresponding QR code generated through the Invoice Registration Portal, and reconciles the population of IRN-generated invoices against the full sales register to identify any invoice issued without going through the e-invoicing process at all — which is treated as not having been issued for GST purposes regardless of whether the tax was otherwise correctly computed.
Applicability and the population to test
- Confirm the aggregate turnover threshold for e-invoicing applicability was correctly assessed, computed across all GSTINs under the same PAN for any of the preceding financial years specified in the notification, not just the year under audit.
- Identify categories of supply that are exempt from e-invoicing even for an otherwise in-scope entity — certain sectors and transaction types (for instance, supplies to SEZ units in some configurations, or specified financial services) are excluded — and confirm the entity has correctly applied the exclusion rather than either over- or under-applying it.
- Build the population of outward invoices from the sales register independently, and test that each invoice in the population has a corresponding IRN, rather than starting from the IRN log and checking only what is already there.
QR code and IRN reconciliation
| Check | Evidence | What it catches |
|---|---|---|
| Threshold assessment | Turnover computation across GSTINs and prior years | Entity incorrectly concluding it is below the applicability threshold |
| IRN presence per invoice | Sample of invoices against the IRP portal log | Invoices issued without an IRN, which are non-compliant even if GST was charged and paid |
| QR code accuracy | QR code decode against invoice details | A QR code that does not match the invoice it is printed on, usually from a manual override after cancellation and reissue |
| Cancellation window | IRN cancellation log | IRNs cancelled outside the permitted window and the replacement invoice's own compliance |
Regulatory requirement
The turnover threshold for mandatory e-invoicing, the categories of exempt supply, and the time window within which an IRN can be cancelled are prescribed by GST notification and have been revised downward over successive years to cover smaller taxpayers. Confirm the current threshold and rules for the period under audit.
An invoice issued without a valid IRN, where e-invoicing applies, is deemed not to be a valid tax invoice — this can affect the recipient's ability to claim input tax credit on that invoice as well as the issuer's compliance position. The exposure runs both ways across the transaction.
This is practical guidance written for audit teams, not an authoritative statement of any standard or statute. Standards, forms and timelines change. Check the current text issued by the ICAI and the relevant authority before relying on anything here in an audit file.
Related resources
- GST & GSTR-2BGSTR-3B vs GSTR-1 reconciliation for auditorsWhy GSTR-1 and GSTR-3B outward-supply figures disagree, the usual causes, and what to do with a difference still unreconciled at the year end.
- Revenue, receivables & cut-offMatching dispatch, invoice and ledger for revenue testingThe sales-side mirror of the purchase three-way match: what breaks it in practice, and why the unmatched population should be sized by value, not count.
- Revenue, receivables & cut-offSales cut-off testing: dispatch, invoice and ledger datesWhy dispatch, invoice and ledger dates disagree at year end, how to sample either side of the cut-off, and the evidence that settles which date governs.
- Purchase & AP auditDuplicate invoice detection during auditWhy exact matching finds almost nothing, the six match rules that do work, and how to tell a duplicate booking from a duplicate payment.
Free tools, no signup
Each one reads a file entirely in your browser — or, for two of them, just answers a few questions — and nothing is ever uploaded.
- Purchase register checkDuplicate payments, round-sum amounts, weekend-dated invoices, incomplete records.
- Bank reconciliation checkerMatches your cash book against a bank statement — what's outstanding on each side.
- Fixed asset register checkDuplicate asset codes, missing location or useful life, negative net book value.
- Payroll red-flag scannerBank accounts shared across employees, and records missing an ID, PAN or salary.
- CARO applicability checkerAnswer a few questions about the company and see which CARO 2020 clauses likely apply.
- MSME payment delay checkerMSME-flagged invoices paid — or still unpaid — beyond the 45-day Section 22 limit.
- Related-party transaction screenerTransactions above a threshold you set with no approval reference, grouped by counterparty.
- Depreciation useful life checkerCompares a useful life in use against the Schedule II, Part C indicative figure.
- Materiality calculatorOverall and performance materiality against PBT, revenue, assets or equity, with reasoning shown.
- Sample size calculatorStatistical sample size for a test of controls or a substantive test of detail.