Key takeaways
- APR due 31 December 2026 through your AD bank.
- Controlled subsidiary = audited statements needed, even if the host country requires no audit.
- Unaudited (certified) statements only if no control and no host-country audit requirement.
APR due 31 December 2026. We prepare the subsidiary's financials and the APR, and coordinate the audit with a practising auditor.Free 15-min callWhatsAppEmail
Short answer
If you control the foreign entity, you need audited financial statements for the APR, even if the host country (for example Delaware or many US states) does not require an audit. Unaudited statements are allowed only when both conditions hold: the Indian investor does not have control, and the host country does not mandate an audit. In that case, the unaudited statements are certified by the statutory auditor of the Indian entity, or by a chartered accountant where no statutory audit applies.
When is the APR due?
By 31 December every year, through your authorised dealer (AD) bank, based on the foreign entity’s accounts for the year ending in the previous calendar year (for most groups, the year to 31 March). For a subsidiary with a March 2026 year end, the APR is due by 31 December 2026. Late filing attracts a late submission fee; see the FEMA late submission fee calculator.
Which case are you?
| Situation | Basis for the APR |
|---|---|
| Wholly owned or controlled subsidiary, host country requires audit (for example UK companies above the small-company exemption) | Audited statements under host-country law |
| Wholly owned or controlled subsidiary, no audit required locally (for example most Delaware corporations) | Audited statements still needed; a special purpose audit for APR is common |
| Minority stake without control, no local audit requirement | Unaudited statements certified by the Indian entity’s statutory auditor or a CA |
How groups get it done
- Prepare the foreign entity’s financial statements in its own currency, from the same books used for consolidation.
- Arrange the audit. Where no local audit exists, groups commonly have a special purpose audit of those statements done for APR and banking purposes. Ask your AD bank in advance which auditor it will accept.
- Prepare and file the APR with the AD bank, with the audited statements and the foreign entity’s key figures.
- Keep the rest of ODI reporting current: Form FC for any new remittance, and the annual FLA return where applicable.
Common mistakes
- Assuming “no US audit requirement” means “no audit for the APR”.
- Filing the APR on INR consolidation figures instead of the subsidiary’s own statements.
- Leaving it to December, when auditors and banks are busiest.
- Missing APRs for dormant or loss-making subsidiaries; they still need one.
Related: FEMA and ODI rules when Indians own a US company and FEMA / RBI compliance.
Sources
- RBI: Form APR and instructions (Overseas Investment, 2022)
- RBI: Foreign Exchange Management (Overseas Investment) Regulations, 2022
- Compliance Calendar: audit requirement for APR filing
Frequently asked questions
Is an audit required for the APR of an overseas subsidiary?
Yes, if the Indian investor has control. The APR must then be based on audited financial statements even where the host country does not require an audit. Unaudited statements, certified by the Indian entity's statutory auditor or a chartered accountant, are allowed only when the investor has no control and the host country does not mandate an audit.
What is the due date for the APR in 2026?
31 December 2026 for foreign entities whose accounting year ended in 2026 up to that point, for most groups the year to 31 March 2026. It is filed through the authorised dealer bank.
Does a Delaware subsidiary of an Indian company need an audit?
Delaware law does not generally require a private corporation to be audited, but if the Indian parent controls it, the APR still needs audited financial statements, so a special purpose audit is usually done for the APR and bank.
What happens if the APR is filed late?
A late submission fee applies under the overseas investment rules, and the AD bank may restrict further overseas remittances until reporting is regularised. It is cheaper to file on time.
Please note: this guide is general information based on the rules as they stood on the review date above. Regulations and RBI/CBDT procedures change often — please get advice on your specific facts before acting.