Académique Documents
Professionnel Documents
Culture Documents
(No. 18 of 2013)
n
r
a
e
l
Un & n
r
a
e
l
Re
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
2011
2013
2009
BACKGROUND
th OCTOBER 2013
24th
Draft Rules on IEPF under
th put live for Public
Phase 4th
Comments
th SEPTEMBER 2013
16th
DRAFT FORMS for rules
under Phase 1 put for Public
Comments
13
it
has
INDIA
its
own
658
29
470
Parts
Sections
Chapters
Sections
95
15
95
Definitions
CS SHISHIR DUDEJA
Schedules
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
Definitions
Schedules
IN
SFIO
Vigil mechanism
Secretarial Audit
Auditor Rotation
Resident Director
Private Placement
Registered Valuers
Dormant Company
Recasting of Account
Secretarial Standards
One Person Company
Key managerial personnel
NCLT, and NFRA
CS SHISHIR DUDEJA
OUT
Treasury Stocks
Statutory Meetings
Sole Selling Agents
Qualification Shares
Convert share into stock
Commencement Certificate
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
Class
Action
CSR
SFIO
OPC
Fraud
Officer
In
Default
Special
Courts
Annual
Report
Dormant
Company
CS SHISHIR DUDEJA
NEW
CONCEPTS
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
Role Of
ID
KMP
Auditors
Rotation
Boards
Report
Secretarial
Internal Audit
Women
Director
Remuneration
& Sitting Fees
NFRA
NCLT
&
NCLAT
Related Party
Transactions
Secretarial
Standards
NEW
CONCEPTS
Appointment
Of Directors
Contd!!!
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
PROVISIONS CITED IN
THE COMPANIES ACT, 2013
FOR BETTER GOVERNANCE
Requirement to spend on CSR activities.
Mandatory Auditing Standards.
Disclosure and approval of Related parties Transactions.
Enhancement of liability of Auditors.
Rotation of Auditors and restriction on Auditor's for providing non-audit services.
Code of Conduct for Independent Directors.
Mode of appointment of Independent Directors and their tenure.
Specific clause pertaining to duties of directors.
Grievances Committee.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
10
SS-1
Secretarial Standard
on Meetings of BOD
SS-4
Secretarial
Standard on
Registers and
Records
SS-8
Secretarial Standards
on Affixing of Common
Seal
SS-2
Secretarial Standard
on General Meetings
SS-5 Secretarial
Standard on Minutes
SS-6
Secretarial Standard
on Transmission of
Shares and Debentures
SS-9
Secretarial Standards
on Forfeiture of Shares
Email: CSshishirdudeja@gmail.com,
CS SHISHIR DUDEJA
Cell: +919910938312
SS-3
Secretarial Standard
on Dividend
SS-7
Secretarial
Standards on
Passing Resolutions
By Circulation
SS-10
Secretarial Standards on
Board's Report
11
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
12
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
13
One
Person
Company
[Section 2 (62)]
Email: CSshishirdudeja@gmail.com,
CS SHISHIR DUDEJA
Cell: +919910938312
OPC Contd!!!
A person can incorporate a maximum of 5 OPCs.
Not required to prepare Cash Flow Statement as a part of Financial Statement.
Must conduct at least One Board Meeting in each half of a calendar year with a
gap of atleast 90 days between the 2 meetings.
Annual Return of OPC shall be signed by Company Secretary, or where there
is no company Secretary, by the Director of the Company.
Only natural persons can incorporate an OPC .Also, the person
incorporating an OPC must be an Indian citizen who has stayed in India for
at least 182 days during the immediately preceding Financial year.
Memorandum of an OPC shall indicate the name of the another person, with
his prior written consent, who shall in the event of the subscribers death or his
incapacity to contract becomes the member of the company.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
15
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
16
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
17
SMALL COMPANY
[Section 2(85)]
Small company means a company other than a public company
i.
ii.
Paid-up Share Capital of which does not exceed Fifty Lakh or such higher
amount as may be prescribed not exceeding Five Crores;
OR
Turnover of which as per its last profit and loss account does not exceed Two
Crore or such higher amount as may be prescribed not exceeding Twenty
Crore.
Exemptions:
. Holding company or subsidiary company
. Company registered under section 8
. Company or body corporate governed under Special Act
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
18
PRIVATE COMPANY
DEFINITION:
A company having minimum paid-up share capital of One Lakh Rupees or such
higher number as maybe prescribed and which by its articles;
Except in case of One Person Company, limits the number of its members to
Two hundred (200);
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
19
DORMANT COMPANY
[Section 455]
Company is formed and registered under this Act:
for a future project; or
to hold an asset or intellectual property; and
has no significant accounting transaction
may make an application to the registrar for obtaining the status of Dormant company.
The Registrar will issue a certificate to that effect.
To retain the status the Company shall have such minimum number of directors,
file such documents and pay such annual fee to the Registrar.
On an application it may become an active company.
In case of failure of any requirements Registrar may strike off the name from
the register of dormant companies
1)
LLP is not a company, hence proposed limit of audit of 20 company / CA will not
be applicable.
2)
As Companies Act will not be applicable, you can transfer fund from one LLP to
another group LLP.
3)
Many of exemption which Pvt Ltd company enjoy under old Companies Act has
been withdrawn, which are not applicable to LLP.
Cont
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
21
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
22
1)
Sec 185 of New Co Act is not applicable to Public Ltd co at a general meeting of
which not less than 25% of the total voting power may be exercised or
controlled by any such director, or by two or more such directors, together
2)
3)
So, we can convert our existing Pvt Ltd companies to Public Ltd companies and
take benefits.
CS SHISHIR DUDEJA
Cont
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
23
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
24
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
25
Annual Return to contain information about KMP and changes if any thereof
and their remuneration
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
26
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
27
DIRECTORS
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
28
WOMAN DIRECTOR
[Section 149 (1) Proviso II]
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
29
Turnover of
Rs.300 Crore or
more.
Every Listed
Company
30
INDEPENDENT DIRECTOR
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
31
INDEPENDENT DIRECTOR
[Section 149]
Every existing company to have IDs within one year from
commencement of the Act or from the date of notification of the Rules
(whichever is first)
Central Government to prescribe the minimum number of Independent
Directors in case of any class or classes of public Companies.
Every listed public Company to have at least one-third of the total number of
directors as Independent Directors (ID)
(As per Draft Rules: Public Companies having paid up share capital of Rs. 100 cr or
more, Public Companies having turnover of Rs. 300 cr or more, Public Companies
which have, in aggregate, outstanding loans or borrowings or debentures or deposits,
exceeding Rs. 200 cr)
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
32
Independent Directors are not entitled to any stock options. This is contrary to
the Listing Agreement, where the maximum limit can be fixed by shareholders
resolution
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
33
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
34
NUMBER OF DIRECTORSHIPS
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
35
NUMBER OF DIRECTORSHIPS
[Section 165]
Maximum 20 companies
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
36
REMUNERATION OF DIRECTORS
[Section 197]
Remuneration of Directors
By Public Company
Managing
Director
TO
Manager
Whole Time
Director
NOT EXCEED 11% OF THE NET PROFITS for that Financial Year.
EXCEPTION: With Prior approval of Central Government authorize
payment of remuneration exceeding 11% in General Meeting.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
37
If there is Only
one MD or
WTD or
Manager.
NOT EXCEED 5%
of the Net profits of
the Company.
CS SHISHIR DUDEJA
If there is more
than one MD or
WTD or
Manager.
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
38
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
39
Monthly in Rs.
(Maximum )
1,50,000
2,00,000
2,50,000
3,00,000
3,50,000
4,00,000
Yearly in Rs.
(Maximum)
30,00,000
42,00,000
60,00,000
60 Lakhs + 0.01%
of the Effective
Capital
in excess of Rs.
250 Crores
40
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
41
BOARDS REPORT
Extract of
Annual Return
Number of
Board Meetings
Declaration by
Independent
Director
CS SHISHIR DUDEJA
Directors
Responsibility
Statement
Comments/Expl-anation by BOD
on Secretarial
Audit Report
Particulars of
Loan/Guarantee/
Investment
Particulars of
Contracts/Arran-gements with
Related Party
Material changes
from end of FY to
date of Report
Statement on
Risk
Management
Policy
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
Details of
CSR Policy
BOD/Committee
Performance
Evaluation
Other Such
Matters
42
BOARDS REPORT
OTHER MATTERS PRESCRIBED
Financial Summary
And Highlights
Companies ceased to be
Subsidiaries,
JVs or Associate
Details of Directors
or KMP
Details of
Significant & Material
orders passed by the
Regulators/ Courts
Details relating to
Deposits
Change in the
Nature of Business,
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
43
BOARD REPORT
Annual Return - Contents
[Section 92]
Securities &
Shareholding
Pattern
Members &
Debenture
Holders
Promoters,
Directors, &
KMP
Meeting of
Board and
Committees
Details of
Compounding
Penalty or
Punishment &
In-Debteness
Remuneration
of Directors and
KMP
Shares held by
or on behalf of
the FIIs
Other Matters
as may be
prescribed.
Meetings of
Members
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
44
COMMITTEE OF BOARD
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
45
COMMITTEE OF BOARD
Nomination &
Remuneration
Committee
U/s 178
Shareholders
Grievance
Committee(U/s 178)
Audit
Committee
U/s 177
BOARD COMMITTEE
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
46
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
47
ELIGIBILITY
RESPONSIBILITES
Consider and Resolve
the Grievances of
Security/Share
Holders of the
Company
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
CHAIRPERSON
Non-Exec. Director
and Other Members as
decided by the Board
48
AUDIT COMMITTEE
[Section 177]
ELIGIBILITY
Every Listed and Other Prescribed Class of Companies
AS PER DRAFT RULES
Every Listed Company, and Every Other Public Company having Paid-up Capital of >Rs. 100 Crore; OR
Outstanding Loans or Borrowings or Debentures or Deposits > Rs 200 Crore
COMPOSITION
Minimum 3 Director with the Independent Director forming majority
Majority of members including its Chairperson shall be persons with ability to read and understand, the financial
statement.
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
49
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
50
Office of Director
shall become vacant in
case Director-
Disqualified by an order of
Court/Tribunal; and/or
Fails to disclose interest in any
Contract / Arrangement; and/or
(in which directly or indirectly interested);
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
51
OFFICER-IN-DEFAULT
[Section 2(60)]
CS SHISHIR DUDEJA
52
NEW PROVISIONS:
Combines sections 297 and 314 both the sections dealt with 2 different
scenarios
Definition of related party widened
Purview of related party transaction widened sale, purchase, leasing of
property included
Arms Length Transaction defined
CG approval replaced with prior approval of shareholders for prescribed
class of companies
Related party contracts to be explained in the Boards report along with
justification for the contract
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
53
RELATED PARTY
[Section 2(76)]
A Director;
A Key Managerial Person;
Relatives of any of Director and/or KMP
A Firm, in which director, manager or his relative is a partner
A Private Company, in which director, manager is a director or member;
A Public Company, in which director or manager is a director or holds along with
his relatives more than 2% of paid-up capital;
Any body corporate whose Board of Directors, Managing Director or Manager is
accustomed to act in accordance with the advice, directions or instructions of a
director or manager;
Any person on whose advice, directions or instructions a director or manager is
accustomed to act;
Any company which is a holding, subsidiary or an associate company of such
company
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
54
List of Relatives
S.
No.
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
Father
Mother (including step-mother)
Son(including step-son)
Sons wife
Daughter ( including step-daughter)
Fathers father and/or Fathers Mother
Mothers Mother and/or Mothers father
Sons son
Sons sons wife
Sons daughter
Sons daughters husband
Daughters husband
Daughter son
Daughters sons wife
Daughters daughter
Daughters daughters husband
Brother ( including step- brothers)
Brothers wife
Sister (including step sister )
Sisters husband
CS SHISHIR DUDEJA
Spouse
Father (including step-father)
Fathers father
Fathers mother
Mother (including step-mother)
Mothers mother
Mothers father
Son ( including step son)
Sons wife
Sons son
Sons daughter
Daughter ( including step- daughter)
Daughters husband
Brother (including step-brother)
Sister (including step-sister)
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
ADDITION /
DELETION
ADDITION
Step-father
DELETION
Sons Wife
Sons Daughters
Husband
Daughter s son
Daughter s sons
wife
Daughters daughter
Daughters
daughters husband
Brothers wife
Sisters husband
55
PROMOTING
WELFARE
INITIATIVES
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
56
Net worth of
Rs. 500 crore or
more
Turnover of Rs.
1000 crore or
more
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
57
CSR Contd!!!
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
58
CSR Contd!!!
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
59
CSR Contd!!!
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
60
CSR Contd!!!
AS PER THE DRAFT RULES
Net Profit: defined as Net Profit before Tax as per books of accounts and does not
include profits from branches outside India
CSR Policy of the company to include:
CSR activities to be within India only;
CSR activities not to benefit only the employees of the company;
Companies may collaborate resources with other companies to undertake CSR;
Specify the projects and programmes that are to be undertaken.;
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
61
CSR Contd!!!
Company may conduct CSR activities through trusts, societies, or non profit
companies operating in India, not set up by company itself.
CSR Project may also focus on integrating business models with social and
environmental priorities.
CSR Policy should provide that surplus arising out of the CSR activity will not be
part of business profits of a company
CSR activities to be conducted as projects or programmes excluding activities
undertaken in normal course of business
CSR
Committee
to
prepare
transparent
monitoring
mechanism
for
implementation
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
62
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
63
DEFINITION OF LOAN
Group companies usually give guarantee or provide securities for loan taken by
other group company.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
64
If any loan had already been given after 11th sep., you should book it as share
application money/ advance for property/ purchase of goods/ materials etc. backed
by adequate documentation. These should be return as soon as possible.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
65
To attract Sec. 185, any interest of director (or other person) in his personal
capacity is relevant. Interest of holding co. is not relevant.
Holding co. itself hold shares, not its directors or other person. Hence, Sec. 185
may not be applicable.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
66
a)
b)
A subsidiary company from having any investment subsidiary for the purposes
of meeting the requirements under any law or under any rule or regulation
framed under any law for the time being in force.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
67
a)
b)
c)
No company shall directly or indirectlygive any loan to any person or other body corporate;
give any guarantee or provide security in connection with a loan to any other
body corporate or person; and
acquire by way of subscription, purchase or otherwise, the securities of any
other body corporate,
exceeding 60% of its paid-up share capital, free reserve and securities premium
account or 100% of its free reserves and securities premium account, whichever is
more.
)
Where the giving of any loan or guarantee or providing any security or the
acquisition under sub-section (2) exceeds the limits specified in that sub-section, prior
approval by means of a special resolution passed at a GM shall be necessary.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
68
No company can give any guarantee or provide any security in connection with
any loan taken by him or such other person.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
69
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
70
MEANING OF CONTROL
[Section 2(g)]
"Control" has been defined as to include:a.
b.
c.
Directly or indirectly,
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
71
EXCEPTIONS
a)
(i)
(ii)
b)
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
72
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
73
D
U
A
R
F
CS SHISHIR DUDEJA
Y
T
I
L
A
I
T
N
E
D
I
F
N
CO
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
74
FRAUD
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
75
DEFINITION OF FRAUD
[Section 447]
Fraud includes
Any act,
Omission,
Concealment of any fact; or
Abuse of position committed
by any person or any other person with the connivance in any manner, with intent to
deceive, to gain undue advantage from, or to injure the interests of, the company or its
shareholders or its creditors or any other person, whether or not there is any wrongful
gain or wrongful loss.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
76
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
77
fraud
is being
CS SHISHIR DUDEJA
or
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
78
Section 143(14) extends obligation cast by section 143 mutatis mutandis to:
Cost Auditors appointed u/s 148 &
Secretarial Auditors appointed u/s 204.
NO DUTY OF CONFIDENTIALITY
UNDER THE CA ACT. [Section 143(13)]
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
79
the auditor has sufficient reason and information to believe that an offence
involving fraud, is being or has been committed against the company by officers or
employees of the company,
such fraud is likely to materially affect the
company, he shall report the matter to CG within 30 days.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
80
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
81
MEANING OF MATERIALITY
[DRAFT RULES 10.10(2)]
A.
B.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
82
The audit committee or the Board, as the case may be, shall reply to the auditors
in writing as to steps taken by the audit committee or the Board in addressing the
issues of fraud, including systemic issues.
In case the audit committee or the Board, as the case may be, is not taking action
or the auditor is not satisfied with the action taken, he may report to the CG even
if the fraud is not material in nature.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
83
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
84
AUDITORS
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
85
TRANSITION PROVISIONS
[PROVISO TO Section 139(2)]
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
86
Individual/ Audit Firm shall be appointed for a period of 5 years and block of 5
years thereafter, respectively
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
87
Meaning of Remuneration
[Section 142(2)]
The remuneration under sub-section (1) shall, in addition to the fee payable to an
auditor, include the expenses, if any, incurred by the auditor in connection with the
audit of the company and any facility extended to him but does not include any
remuneration paid to him for any other service rendered by him at the request of the
company.
Remuneration of Auditors
[Section 142]
This Section provides for remuneration of auditors of the company. It further defines
the term remuneration. The remuneration is to be fixed generally in the general
meeting.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
88
A CA within the meaning of the CA Act, 1949 may be appointed as an auditor. Only
a CA holding a CP can be appointed as an auditor.
A firm whereof all the partners practicing in India are qualified for appointment
may be appointed by its firm name to be the auditor of a company.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
89
DISQUALIFICATIONS OF AUDITORS
[Section 141]
A body corporate other than a LLP:
An officer or employee of the company.
A person who is a partner, or who is in the employment, of an officer or employee
of the company
A person who, or his relative or partner
is holding any security of or interest (beneficial owner) in the company or its
subsidiary, or of its holding or associate co. or a subsidiary of such holding co.
However, the relative may hold security or interest in the company of face value
not exceeding Rs. 1,000 or such sum as may be prescribed (1 Lakh) ;
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
90
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
91
A person who has been convicted by a court of an offence involving fraud and a
period of 10 years has not elapsed from the date of such conviction;
Any person whose subsidiary or associate co. or any other form of entity, is engaged
as on the date of appointment in consulting and specialized services as provided in
sec. 144.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
92
Appointment in EGM within 90 days : On failure of Board, Co. shall inform the
members, who shall appoint at EGM.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
93
APPOINTMENT OF AUDITORS
[Section 139(1)]
Appointment at 1st AGM: Every company shall, at the first AGM, appoint an
individual or a firm as an auditor.
Tenure of office: Till the conclusion of 6th AGM and thereafter till the conclusion
of every 6th meeting.
Ratification: The Company shall place the matter relating to such appointment of
ratification by member at every Annual General Meeting.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
94
Written consent: Before such appointment is made, the written consent of the
auditor to such appointment shall be obtained from the auditor.
Notice of appointment: The Company shall inform the auditor concerned of his or
its appointment, and also file a notice of such appointment with the Registrar within
15 days of the meeting in which the auditor is appointed.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
95
STATUS
Individual
Audit Firm
PERIOD
1 term of 5 consecutive years
2 terms of 5 consecutive years
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
96
Appointment by C&AG: In the case of a Govt. Co. or any other company owned or
controlled, directly or indirectly, by the CG, or by any SG, or Governments, or
partly by the CG and partly by one or more SGs, the first auditor shall be appointed
by the C&AG within 60 days from the date of registration.
Appointment by Board: In case the C&AG does not appoint such auditor within the
said period, the BOD shall appoint such auditor within the next 30 days.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
97
Appointment in EGM: In the case of failure of the Board to appoint such auditor
within next 30 days, it shall inform the members of the company who shall appoint
such auditor within 60 days at an EGM.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
98
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
99
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
100
INTIMATION OF APPOINTMENT
COMPANIES ACT, 1956
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
101
The CG may, by rules, prescribe the manner in which the companies shall rotate
their auditors in pursuance of sub-section (2) {Sec 139(4)}.
Members
of
a
company
may
resolve
to
provide
that
(a) in the audit firm appointed by it, the auditing partner and his team shall be
rotated at such intervals as may be resolved by members; or
(b) the audit shall be conducted by more than one auditor. {Sec 139(3)}
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
102
In the case of a Govt. Co. or any other company owned or controlled, directly or
indirectly, by the CG, or by any SG or Governments, or partly by the CG and
partly by one or more SGs, the C&AG shall, in respect of a financial year, appoint
an auditor duly qualified to be appointed as an auditor of companies under this Act,
within a period of 180 days from the commencement of the FY, who shall hold
office till the conclusion of the AGM.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
103
CASUAL VACANCY
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
104
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
105
The auditor may be removed by special resolution after obtaining the previous
approval of CG and after giving an opportunity of being heard.
When the Auditor resigns, a statement in prescribed form is to be filled with the
Company and the Registrar within 30 days.
Special notice shall be required for appointing a person as auditor other than a
retiring auditor.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
106
INTIMATION OF RESIGNATION
The auditor shall file within a period of 30 days from the date of resignation, a
statement in the prescribed form with (Form no.10.2):
a. the Company and
b. the Registrar and
c. the CAG (where applicable)
indicating the reasons and other facts (for resignation)
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
107
ACCOUNTS
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
108
FINANCIAL STATEMENTs
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
109
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
110
FINANCIAL YEAR
[Section 2(41)]
Period ending on 31st March every year, and where it has been incorporated on or after
the 1st day of January of a year, the period ending on the 31 st March of the following
year, in respect whereof financial statement of the company or body corporate is made
up:
Tribunal may, if it is satisfied, allow any period as its financial year to a Holding
company or a Subsidiary of a company incorporated outside India and is required to
follow a different financial year for consolidation of its accounts outside India,
whether or not that period is a year:
Company or body corporate, existing on the commencement of this Act, shall, within a
period of 2 years from such commencement, align its financial year as per the
provisions of this clause;
The Companies Act, 2013 does not provide for extension of FY
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
111
[Section 129]
The FS shall give a true and fair view and comply with the AS & shall be in the
form as provided in Schedule III.
The holding company shall in addition, prepare a CFS of the Company, all
subsidiaries, associates & joint ventures and lay before the AGM.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
112
This new Section provides for provisions relating to re-opening or re-casting of the
books of accounts of Company pursuant to order of Court or Tribunal on application
made by CG, any Statutory Authority or any person concerned if it was found that
earlier accounts were prepared in fraudulent manner or financial statements are not
reliable due to mismanagement of affairs of the company. The accounts so revised or
re-cast shall be final.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
113
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
114
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
115
This Section provides that the FS should be approved by the BOD before they are
signed and submitted to auditor. The Boards Report & Auditors Report are to be
attached with every FS before it is issued.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
116
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
117
Internal Audit
[Section 138]
This new Section provides for conduct of internal audit of prescribed class or classes
of companies. Manner of conducting internal audit shall be prescribed by the CG.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
118
DEPRECIATION
Dep. = (Cost Residual Value)/Useful life
Schedule II introduced
Depreciation to be based on useful life & residual value
Useful lives of various tangible assets prescribed
Residual Value not more than 5% of the original cost of the asset
From the date Schedule II becomes effective carrying amount of the asset shall be
depreciated over the remaining useful life of the asset
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
119
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
120
(ii) In respect of other companies the useful life of an asset shall not be longer than
the useful life and the residual value shall not be higher than that prescribed in
Part C.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
121
PART C
5. Subject to Parts A and B above, the Nature of various Tangible Assets and their
useful life are given in the Section.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
122
Constitution of
National Financial Reporting Authority
[Section 132]
This Section provides that the CG may by notification constitute the NFRA
to advice on Accounting Standards (AS) & Auditing Standards(SA),
to monitor, enforce, compliance and overseeing the quality of service of associated
professionals. .
The authority shall have power to investigate the matters of misconduct committed by
any member of ICAI or any other prescribed profession and pass order which may be
appealed to Appellate Authority to be constituted by CG.
Qualifications, terms and conditions of appointment of the chairperson and members
of the Appellate Authority have also been provided.
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
123
Central Government shall, by notification, constitute with effect from such date
as may be specified therein, a Tribunal to be known as the National Company
Law Tribunal. (Section 408)
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
124
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
125
MISCELLANEOUS
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
126
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
127
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
128
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
129
COSTING STANDARD
CAS-1 - Classification Of Cost
CAS-2 - Capacity Determination
CAS-3 - Overheads
CAS-4 - Cost Of Production For Captive Consumption
CAS-5 - Determination Of Average (Equalized) Cost Of Transportation
CAS-6 - Material Cost
CAS-7 - Employee Cost
CAS-8 - Cost Of Utilities
CAS-9 - Packing Material Cost
CAS-10 - Direct Expenses
CAS-11 - Administrative Overheads
CAS-12 - Repairs & Maintenance Cost
CAS-13 - Cost Of Service Cost Centre
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
130
SECRETARIAL STANDARDS
SS-1 : Secretarial Standard on Meetings of the Board of Directors
SS-2 : Secretarial Standard on General Meetings
SS-3: Secretarial Standard on Dividend
SS-4: Secretarial Standard of ICSI on Registers and Records
SS-5: Secretarial Standard on Minutes
SS-6: Secretarial Standard on Transmission of Shares and Debentures
SS-7: Secretarial Standard on Passing of Resolutions by Circulation
SS-8: Secretarial Standard on Affixing of Common Seal
SS-9: Secretarial Standard on Forfeiture of Shares
SS-10: Secretarial Standard on Boards Report
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
131
ACCOUNTING STANDARDS
AS 1 Disclosure of Accounting Policies
AS 2 Valuation of Inventories
AS 3 Cash Flow Statements
AS 4 Contingencies and Events Occurring After the Balance Sheet Date
AS 5 Net Profit or Loss for the Period, Prior Period Items and Changes in Accounting
Policies
AS 6 Depreciation Accounting
AS 7 Construction Contracts
AS 9 Revenue Recognition
AS 10 Accounting for Fixed Assets
AS 11 The Effects of Changes in Foreign Exchange Rates
AS 12 Accounting for Government Grants
AS 13 Accounting for Investments
AS 14 Accounting for Amalgamations
AS 15 Employee Benefits
Amended vide G.S.R. 212(E) 27.03.2008 - Companies (Accounting Standards) \
Amendment Rules, 2008
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
132
Borrowing Costs
Segment Reporting
Related Party Disclosures
Leases
Earnings Per Share
Consolidated Financial Statements
Accounting for Taxes on Income
Accounting for Investments in Associates in Consolidated Financial Statements
Discontinuing Operations
Interim Financial Reporting
Intangible Assets
Financial Reporting of Interests in Joint Ventures
Impairment of Assets
Provisions, Contingent Liabilities and Contingent Assets
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
133
GUIDELINES
Voluntary Guidelines for Companies for providing general information on their websites
Name Availability Guidelines, 2011
Corporate Social Responsibility Voluntary Guidelines 2009
Guidelines for Corporate Governance for CPSEs 2010
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
134
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
135
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
136
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
137
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
138
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
139
Chapter I -Preliminary (1 - 2)
Chapter II -Incorporation of Company and Matters Incidental Thereto (3 - 22)
Chapter III -Prospectus and Allotment of Securities (23 - 42)
Chapter IV -Share Capital and Debentures (43 - 72)
Chapter V -Acceptance of Deposits by Companies (73 - 76)
Chapter VI -Registration of Charges (77 - 87)
Chapter VII -Management and Administration (88 - 122)
Chapter VIII -Declaration and Payment of Dividend (123 - 127)
Chapter IX -Accounts of Companies (128 - 138)
Chapter X -Audit and Auditors (139 - 148)
Chapter XI -Appointment and Qualifications of Directors (149 - 172)
Chapter XII -Meetings of Board and its Powers (173 - 195)
Chapter XIII -Appointment and Remuneration of Managerial Personnel (196 - 205)
Chapter XIV -Inspection, Inquiry and Investigation (206 - 229)
Chapter XV -Compromises, Arrangements and Amalgamations (230 - 240)
Chapter XVI-Prevention of Oppression and Mismanagement (241 - 246)
Chapter XVII-Registered Valuers (247)
Chapter XVIII-Removal of Name of companies from the Register of Companies (248 - 252)
Chapter XIX-Revival and Rehabilitation of Sick Companies (253 - 269)
Chapter XXI -Companies Authorized to Register Under This Act & Winding Up of Unregistered Companies (366
378)
Chapter XXIV-Registration offices and fees (396 - 404)
Chapter XXVI-Nidhis (406)
Chapter XXIX Miscellaneous (447 - 470)
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
140
CS ShiShir Dudeja
Cell : +91-9910938312
E-mail : shishirdudeja@live.com
CSshishirdudeja@gmail.com
LinkedIn: http://in.linkedin.com/in/shishirdudeja
Twitter: https://twitter.com/DudejaShiShir
FB: https://www.facebook.com/shishir.dudeja
CS SHISHIR DUDEJA
Email: CSshishirdudeja@gmail.com,
Cell: +919910938312
141