Audit under section 44AB is required when turnover exceeds Rs. 1 crore. But in case of speculation business, shares trading and futures/options, turnover is determined in the following manner.
1) Speculation Business – The aggregate of both positive and negative differences is to be considered as the turnover.
2) Intra day trading of shares – The aggregate of both positive and negative differences is to be considered as the turnover.
3) Delivery based trading of shares – Sale value or purchase value whichever is high is considered as turnover.
4) Futures – The aggregate of both positive and negative differences is to be considered as the turnover.
5) Options – Premium received on sale of options is also to be included in turnover.
Eg:-
| Purchases | Sales | Difference (Profit or Loss) | |
| Trade 1 | 2,00,000 | 2,50,000 | 50,000 |
| Trade 2 | 1,75,000 | 1,50,000 | 25,000 |
| Total of differences considered as turnover | 75,000 |
