Government of India through/by means of various amendments in legislations time to time   recognized  the importance of Secretarial Audit  of companies through Section 204 in the Companies Act. Section 204, prescribes for preparation and submission of a Secretarial Audit Report from a Practising Company Secretary duly appointed by the Board, which in a summarized form ensures compliance  of all applicable laws and provisions by the company. It is the duty of Board of Directors (BOD) of the company to ensure due diligence of all compliance by the company and its members and  the practicing company secretary appointed  makes sure hat the same  are duly abided by.

Earlier, with application of Corporate Governance Voluntary Guidelines, 2009  the requirement for Secretarial Audit was voluntary on companies, but with Introduction of Section 204 Read with rules made  in the Act, it was made mandatory for specified class of companies. As per the section, every public company which is  registered  under the Companies Act, 2013 and where the annual turnover of business is Rs 250 crore or more or with paid capital of Rs. 50 crore or more or every company whose outstanding loans, borrowings from banks or financial institution  of Rs. 100 crore or more, mandatorily have to obtain and submit Secretarial Audit Report.

Why Secretarial Audit for Companies?

• Secretarial audit examines the crucial aspects of compliance which ensures applicable statutes, rules and regulations which are whether duly followed by companies or not.
• Secretarial Audit ensures that the information to stakeholders, regulators and management about the company’s progress, risk management tactics etc. followed by the company and level of discipline a company are towards best governance.
• Secretarial Audit Report is a trustworthy statement for many law enforcement agencies for granting project approvals or other approvals demanded by a company in course of its business.

Scope of Secretarial Audit for Companies

A Secretarial audit is not like doing a financial audit of business, it is much linked to compliance by the  company for all applicable  laws and provisions :

• A single disclosure statement states for compliance  of applicable statues to entity, which includes  :
  • Companies Act, 2013
  • Reserve Bank of India /Foreign Direct Investment Guidelines
  • Foreign Exchange Management Act
  • Insolvency and Bankruptcy Code, 2016
  • Environment and Labour Codes
  • Securities and Contract Act / SEBI Guidelines
  • Income Tax Act, 1961 and Goods, and Service Tax, 2017
  • Employee Provident Fund
  • Employee State Insurance Act
  • RERA (Real Estate Regulatory Authority ) Guidelines
  • Customs clearance and related procedures
  • Labour & Employment Laws In addition to but not limited  to all other  laws relating  to trade and commerce  applicable on the company.

For the laws and regulations which are specifically applicable to the company, a checklist is to be prepared and accordingly after reporting from different heads of departments, the compliance is to be checked.

A Company is under an obligation to suffice its compliance filings for particular Financial Year through a report of an appointed Practising Company Secretary. Such report shall be prepared and submitted in Form MR- 3.

Why MN & Associates for Secretarial Audit Services?

We are a  Practising Company Secretary Firm providing Secretarial Audit and related corporate compliance services in and around Delhi. We are a team of “Company Secretary professionals” equipped with knowledge and  comprehensive  exposure  of procedures.

The professionals at MN & Associates are proficient in delivering a variety of corporate solutions ranging from taxation, business licensing, consultation and advisory on all legal matters, intellectual protection, drafting of corporate documents.

Get dedicated support on Secretarial Audit.

Email us at info@cs-india.com