Balance confirmation letter for audit: format and how to collect replies
Last reviewed 22 October 2026. General information, not legal or tax advice.
Every year-end, accounts teams send balance confirmation letters to customers and then spend weeks chasing the replies. A clear letter and an easy way to reply make it much faster.
What the letter must contain
- Your business name and the customer’s name and address.
- The “as on” date (usually 31 March) and the balance in your books, with a statement of account attached.
- A request to confirm the balance, or to state their figure and explain the difference.
- Where and by when to reply, and who to contact.
Sample format
Subject: Confirmation of balance as on 31 March 2026
Dear Sir/Madam, as per our books, the balance due from you as on 31 March 2026 is ₹4,82,300 (Rupees Four Lakh Eighty-Two Thousand Three Hundred only), as shown in the enclosed statement of account. Please confirm this balance, or let us know your figure with the details of any difference, by 30 April 2026. If we do not hear from you, we will treat the balance as correct. Thank you.
Collecting replies
Replies by post or email arrive slowly and in every format. A single link per customer, where they confirm or enter their own figure with a note, gets faster and cleaner answers that are easy to hand to the auditor.
Doing it without the manual work
Tagaada sends each debtor a private link to confirm the balance or send their own figure with a note, and shows you confirmed, disputed and waiting customers with the difference. You download the report for the auditor. It is part of the tools for CA firms and free.
Frequently asked questions
Why do auditors ask for balance confirmations?
External confirmation from the customer is strong audit evidence that a receivable exists and is correct. Auditing standards on external confirmations (SA 505 in India) describe how auditors use them.
What if the customer’s figure is different?
Treat it as a reconciliation, not a dispute. The difference is usually a payment in transit, a debit note, TDS or an invoice the customer has not booked. List the items that explain it.
Should confirmations go out as of 31 March?
Yes, usually as of the balance sheet date, so the confirmed figure can be compared directly with the books. They can be sent in early April once the year’s entries are complete.