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Sunday, July 21, 2024

ORERA Mandates Annual Audits for Real Estate Project Bank Accounts

The Odisha Real Estate Regulatory Authority (ORERA) has issued an order for the promoters to mandatorily submit the annual audit reports of bank accounts for respective real estate projects.As per the rules, the promoters need to maintain a separate bank account for each of the housing projects if they have taken booking amount from the homebuyers.

The money should be used only in that project for which the amount is taken, the rule said. The RE (R&D) Act, 2016 mandates that seventy per cent of the amounts realised for the real estate projects from the allottees, from time to time, shall be deposited in a separate bank account to be maintained in a scheduled bank to cover the cost of construction, the order reads.

It states that the amounts from the separate account shall be withdrawn by the promoters after it is certified by an engineer, an architect and a chartered accountant in practice and the withdrawal is in proportion to the percentage of completion of the project.

The promoters shall get his accounts audited within six months after the end of every financial year by a chartered accountant in practice and shall produce a statement of the accounts duly certified and signed by such chartered accountant.

The order also says that it should be verified during the audit that the amounts collected for a particular project have been utilised for the project and the withdrawal has been in compliance with the proportion to the percentage of completion of the project.

ORERA chairman Siddhanta Das said the annual audit certificate is required for the purpose of maintaining transparency in the account and ensuring that housing project is being executed in a right way so that homebuyers are not affected in any manner. The promoters who have taken the booking amount from the allottees should maintain a separate bank account and get it audited annually and submit the report.

“The promoters who are executing the projects from their own resources however need not to submit such report,” he said. Homebuyers welcomed the move but said that ORERA needs to ensure that the promoters comply with the order.

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