Peer review: which phase your firm is in, and when your gate closes
A firm is bound by the earliest peer review phase it meets, on its clients or its partner count. Phase IV is dated 31 December 2026.
Summary
ICAI's peer review mandate binds a firm by the earliest phase it meets on either of two triggers, its client list or its partner count, and most firms only ever check the first. Phase III has been in force since 1 July 2025, and Phase IV, which reaches every attestation practice with three or more partners, is dated 31 December 2026.
The situation
Every few months a partner messages me the same question: "Do we need a peer review certificate yet?" The honest answer used to be "let me re-read the circulars", because ICAI has announced, revised and deferred this mandate eleven times since February 2022 and its own page lists the deferrals, not the current rule. Each secondary summary online is a snapshot of one announcement, so two well-meaning articles a year apart disagree on the dates and neither says why.
The consequence of getting it wrong is not a fine. It is a gate. Without a valid certificate a firm cannot accept a statutory audit that falls inside the mandate, and the certificate must be valid both when the audit is accepted and when the report is signed.
The rule
The mandate runs in four phases. Each phase has two independent triggers. A firm is bound by the earliest-dated phase it meets on either trigger.
| Phase | Client-type trigger | Partner trigger (attestation firms only) | Effective date today |
|---|---|---|---|
| I | Statutory audit of entities whose equity or debt securities are listed in India or abroad | — | 1 Apr 2022 |
| II | Statutory audit of unlisted public companies with paid-up capital ≥ ₹500 crore, or turnover ≥ ₹1,000 crore, or loans, debentures and deposits outstanding ≥ ₹500 crore | 5 or more partners | 1 Jul 2024 |
| III | Statutory audit of entities that raised more than ₹50 crore from the public, banks or financial institutions during the period under review, or of a body corporate (including trusts) that is a public interest entity | 4 or more partners | 1 Jul 2025 |
| IV | Proposes to undertake audit of branches of public sector banks | 3 or more partners | 31 Dec 2026 |
Source: ICAI's Peer Review Mandate page and the Roll Out (Revised) announcement of 11 April 2022, read with the deferment announcements of 16 March 2024, 22 January 2025 and 31 December 2025 (links below).
The dates in that last column are the product of eleven announcements. Here they are in order, because this is the table nobody restates:
| Date | Announcement | Effect |
|---|---|---|
| 12 Feb 2022 | Peer Review Mandate — Roll Out | Mandate announced |
| 25 Feb 2022 | Declaration Form — Phase I | Phase I declaration form prescribed |
| 5 Apr 2022 | Revision in Peer Review Mandate | Roll-out revised |
| 11 Apr 2022 | Roll Out (Revised) | The original roadmap: I 1.4.2022, II 1.4.2023, III 1.4.2024, IV 1.4.2025 |
| 9 Nov 2022 | Phase II Roll Out | Phase II criteria rolled out |
| 10 May 2023 | Deferment of second phase | Phase II deferred from 1.4.2023 |
| 19 Jul 2023 | Further deferment of second phase | Phase II deferred again |
| 16 Mar 2024 | Revised Applicability (Phase II & III) | Phase II → 1.7.2024; Phase III → 1.1.2025 |
| 24 Dec 2024 | Clarifications / FAQs | Attestation scope, partner-count date, acceptance-and-signing rule |
| 22 Jan 2025 | Deferment of Phase III and IV | Phase III → 1.7.2025; Phase IV → 1.1.2026 |
| 31 Dec 2025 | Deferment of Phase IV | Phase IV "applicable from 01.01.2026 be extended to 31.12.2026" |
Three supporting rules from the December 2024 clarifications matter in practice. "Attestation services" means audit, tax audit, GST audit and certification work, and excludes management consultancy, tax return preparation, due diligence and opinions on accounting standards. A practice unit that renders no attestation services needs no certificate under the mandate. The partner count is tested on the date the phase becomes applicable, and continuing. A certificate is valid for three years.
Where people go wrong
The partner trigger is the one that catches firms. Every published table presents the phases client-type first, so a five-partner firm that audits only small private companies reads Phase II, sees "₹500 crore paid-up capital", and concludes it is nowhere near the mandate. It met the Phase II partner trigger on 1 July 2024 and has been inside the gate for over two years.
The Phase III date is widely misquoted as 1 January 2025. That was the date set on 16 March 2024. The 22 January 2025 announcement deferred it by six months to 1 July 2025. Articles written between those two dates are still in the top search results and still say January.
The Phase IV wording is genuinely ambiguous. ICAI's 31 December 2025 announcement says the applicability date "be extended to 31.12.2026". Read literally, Phase IV applies from that date. Read as every earlier deferral was worded, it applies from the day after. A firm with three partners should treat 31 December 2026 as the day its certificate must already be in hand, not the day to start.
Acceptance is the test, not signing alone. For an engagement accepted after the phase date the certificate must be valid at acceptance and at signing. Only an audit accepted before the phase date gets by on validity at signing.
What to do
- Count your partners as on each phase date, and check whether the firm renders any attestation service at all. If it does, the partner trigger applies to you regardless of your client list.
- Find the earliest phase you meet on either trigger. That phase's date is your gate.
- If the gate has already passed, list the statutory audits accepted after it and take advice before accepting the next one. This is a conversation, not a form.
- If the gate is ahead of you, work back from it. The Peer Review Guidelines, 2022 run the review to a Day 90 final report, so file Form 1 at least six months before your date. Since 2 July 2026 new Form 1 applications are accepted only on ICAI's PRB Web Portal at prb.icai.org; e-mail and physical filing are closed.
- Diarise the ICAI Peer Review Mandate page. A sixth deferral would move one row in the table above and nothing else.
The tool
I got tired of re-deriving this from five circulars each time someone asked, so I built a small resolver. You enter your partner count, whether the firm renders attestation services and what kinds of entities it audits. It reports the earliest phase you meet, the date your gate closes, whether an existing certificate actually covers that gate, and prints a one-page working paper with the full deferral history so the answer can be checked rather than trusted. It runs entirely in your browser and nothing you type leaves your machine. It does not file anything, and it does not know your facts: if your partner count changed mid-year or an engagement was accepted before a phase date, read the verdict against those facts and verify with your own reading of the announcements.
Check which peer review phase applies
Sources
- ICAI, Peer Review Mandate — https://www.icai.org/post/peer-review-mandate
- ICAI, Peer Review Mandate — Roll Out (Revised), 11 April 2022 — https://www.icai.org/post/peer-review-mandate-roll-out-revised
- ICAI, Peer Review Guidelines, 2022 — https://resource.cdn.icai.org/72010prb57960-peer-review-guidelines-2022.pdf
- CAclubindia, revised applicability of Phase II & III (16 March 2024) — https://www.caclubindia.com/news/icai-announces-revised-applicability-of-peer-review-mandate-phase-ii-iii-23246.asp
- abcaus, ICAI defers Phase III & IV (22 January 2025) — https://abcaus.in/icai/icai-defers-applicability-of-peer-review-mandate-phase-iii-iv.html
- CAclubindia, Phase IV deferred to 31 December 2026 — https://www.caclubindia.com/news/icai-defers-phase-iv-of-peer-review-mandate-to-31st-december-2026-26002.asp
- TaxGuru, Peer Review Mandate FAQs and clarifications — https://taxguru.in/chartered-accountant/icai-peer-review-mandate-faqs-clarifications.html
- TaxGuru, ICAI launches PRB Web Portal (2 July 2026) — https://taxguru.in/chartered-accountant/icai-launches-prb-web-portal-peer-review-process.html