A GSTR-2B reconciliation workflow turns a one-off spreadsheet exercise into a repeatable monthly service: collect the register and the statement on a fixed date, run a standard matching routine, categorise differences the same way for every client, escalate only the categories that need a person, and follow up open items until they close. The difficulty is never the reconciliation itself. It is doing it identically across a client base, month after month, with the exceptions actually chased rather than carried forward.
Why a workflow rather than a procedure
A single reconciliation is a procedure. Sixty clients a month is an operation, and operations fail for reasons procedures do not: the data arrives in a different shape from each client, the person who did it last month has moved to another team, the exceptions raised in June are still open in November, and nobody can say what the firm's position is on any of it without opening sixty files.
Everything below is firm practice rather than regulatory requirement. The statutory obligations belong to the client. What a firm chooses to do about them, and how, is a business design decision.
Common practice, not a requirement
No standard or statute requires a CA firm to reconcile input credit monthly, or in any particular format. The deadlines that matter are the client's: the monthly return, the reversal dates in Rules 37 and 37A, and the outer limit in section 16(4). A workflow exists to make sure those are not missed, not because the workflow is itself required.
The monthly cycle
| When | What happens | Who |
|---|---|---|
| Days 1–10 of the following month | Purchase register for the month requested and received. Chased against a standing list rather than a fresh email each time. | Support staff, on a checklist |
| From the 14th | GSTR-2B downloaded for each registration, with the download date recorded and the file retained. | Support staff |
| Same day | Matching routine run. Expected differences removed first, then the matching ladder, then categorisation. | Automated where possible; otherwise a prepared template |
| Within two working days | Categorised output reviewed. Only three categories normally need a person: supplies where eligibility is in question, suppliers who have not filed, and the unexplained residue. | Senior |
| Before the return is filed | Client informed of the position, with a separated list of what needs a correction in their books and what needs a conversation with a supplier. | Manager |
| Rolling | Open items from prior months re-tested against the new statement. Items that have resolved are closed; items approaching a reversal deadline are escalated. | Senior, on the open-items register |
GSTR-2B generated on the 14th is a draft, and actions taken in the Invoice Management System after that date cause it to be recomputed. A workflow that downloads once and never again will be working from a statement the client has since changed. Record the download date on every file, and re-download before concluding for the year.
What to standardise
Standardisation is the whole return on building a workflow. Five things are worth fixing firm-wide, and the rest is better left to the engagement team.
- 01The input formatOne specification for the purchase register: the columns required, the date field it must be filtered on, and one row per invoice line rather than per voucher. Send it to the client once, with a sample, and stop accepting anything else. This single change removes more rework than any other.
- 02The exclusionsReverse charge, imports, composition dealers, exempt and non-GST supplies, credit and debit notes. Same six, applied in the same order, quantified every time.
- 03The matching ladderThe passes, the normalisation rules for invoice references, and which pass matched each line. Written down, so two staff produce the same result.
- 04The difference categoriesA fixed list, used identically across clients. Categories that vary by client cannot be reported on in aggregate, and aggregate reporting is the point of doing this as a service.
- 05The open-items registerOne place per client where an unresolved difference lives, with the category, the amount, the date it was raised, the deadline that applies to it and its current status. Without this, differences are re-discovered monthly and never closed.
What should not be standardised is the conclusion. Whether a client's explanation is adequate, whether a residue is small enough to accept, and whether a supplier's promise to file is credible are judgements about a specific client, and a firm-wide rule for them would be a firm-wide way of getting them wrong.
Staffing and review
The work divides into three bands, and most firms lose money by staffing all three at the same level.
| Band | Work | Appropriate level |
|---|---|---|
| Collection and preparation | Chasing the register, downloading the statement, checking the file against the specification, running the routine | Support staff on a checklist. This is the largest share of the hours and the lowest share of the judgement. |
| Categorisation and first review | Confirming the exclusions, reviewing the matched population, working the unmatched residue down | Senior. Needs someone who understands why a difference falls in one category rather than another. |
| Conclusion and client conversation | Deciding what the position is, what the client must do, and what goes in the audit file at the year end | Manager or partner. This is the part that carries the firm's name. |
If the year-end audit conclusion on input credit is drawn from monthly reconciliations prepared by the firm, the firm has prepared information it is also auditing. That is a self-review threat and it needs to be identified and addressed under the ethical requirements applicable to the engagement, not ignored because the work was useful.
Measuring whether it is working
Four measures are enough, and all four are about closure rather than volume. Counting reconciliations completed measures activity, not outcome.
- Match rate at pass 1 and pass 2, by client. A client whose match rate is persistently poor has a data quality problem worth fixing once rather than working around monthly.
- Age of open items. Differences older than a quarter are the ones that turn into lost credit, and the register should be sorted by age rather than by amount.
- Credit at risk, by client and by category, trended across months. A rising supplier non-filing figure at one client is a conversation worth having early.
- Rework: how often a register had to be requested again. This measures how well the input specification is actually being enforced.
What this buys at the year end
A firm running this monthly arrives at the audit with the input credit position already reconciled, the differences already categorised, and the open items already chased. The year-end work becomes a review of twelve completed reconciliations and a conclusion, rather than a fortnight of matching in January.
It also changes what the firm can tell a client during the year, which is where the commercial value sits. A schedule of suppliers who have not filed, delivered in September, still has a remedy attached to it. The same schedule delivered with the audit report does not.
How we think about this
A workflow is worth building only for work that is genuinely repetitive, and input credit reconciliation qualifies: the same files, the same rules, the same categories, every month. Lekhya is built around that distinction. The matching and categorisation are deterministic and should run the same way every time; the judgement about what a category means for a particular client belongs to the person who signs.
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-2B reconciliation: a practical guide for auditorsWhat GSTR-2B is, how the Invoice Management System changed it, the statutory conditions that govern input credit, and how to run and conclude the reconciliation.
- GST & GSTR-2BInvestigating ITC mismatches during auditA decision path for an ITC mismatch: available, eligible, still claimable. What the client can do about each outcome, and how to quantify credit at risk.
- Audit workflow & automationAudit automation for CA firms: what to automate firstHow to decide what to automate, ranked by return rather than by how impressive it sounds, with a scored ranking of common audit tasks and what to leave alone.
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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.
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- 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.