Companies Act 2013

Presented by

Soy Joseph, ACS, ACIS (UK), BL, Senior Partner

Companies Act 2013

AOC 4

Presented by

Sony George Mathew, ACS, BL, Partner

Key Areas

2

KE

Y A

RE

AS

Applicable Sections & Rules

Definitions

Consolidated Financial Statement

Corporate Social Responsibility

Approval & Signing of FS

Auditors Report

Forms & Attachments

Filing Due Date

Non Compliance

AOC 4 – Practical Aspects

Section / rules / applicability

3

Particulars

Applicable

Sections

2(40) – Definition of Financial Statement

2(41) – Definition of financial year.

128 – Books of Accounts etc., to be kept by the company.

129 – Financial Statement

133 – Central Government to prescribe Accounting Standards

134 – Financial Statement, Board’s report, etc.,

135 – Corporate Social Responsibility

136 – Right of members to copies of financial statements.

137 – Copy of financial statement to filed with the Registrar

Section / rules / applicability

4

Particulars

Applicable

Sections 179 – Powers of the Board.

403 – Fee for filing. Etc.,

- Compounding of offence – u/s 92 (5), Not yet enforced

Section 621A of the Companies Act, 1956.

- Punishment for fraud

448 - Punishment for false statement.

455 (1) & (2) - Inactive and Dormant Company

Applicable

Rules

Companies (Accounts ) Rules, 2014

CARO 2015

April to March

Incorporated On

or Before 31st

December

Incorporated On

or after 1st

January

31st March of Current Year 31st March of following Year

Transition

Period - 2 years

Financial Year – Sec 2(41)

Adopt different Financial Year on Application to the Tribunal [CLB for the time being].

Applicable to company having holding or subsidiary company outside India and requires to prepare consolidation financial statements outside India.

Major Changes as per New Act:

Uniform FY 12 Months, No Extension – 15 months by board & 18 months by RoC.

5

Books of Accounts

6

Books of accounts include Cost Records

Accessible in India and usable for subsequent reference

Branch records must be kept unaltered and in a manner as received from branches

Books of Accounts can be maintained in Electronic mode also

A proper system for storage, retrieval, display or printout of electronic records

Back up must be kept in servers physically located in India on a periodic basis

Electronic Mode

Financial Statement

7

Financial

Statement

Explanatory Notes

Statement of Changes in Equity

Cash Flow Statement

Profit & Loss Account

Balance Sheet

Note:

Cash Flow Statement not applicable for One Person Company, Dormant company and Small Company

Format of Financial Statement

8

Format of Financial Statement

FY before 01.04.2014

Revised Schedule VI of CA’1956

CARO 2003

FY from/after 01.04.2014

Schedule III of the Companies Act, 2013

New CARO 2015

Financial Statements – As per Section 129 & Schedule III

Format prescribed in Schedule III of the Act.

Need to comply with Accounting Standards compulsorily

CARO 2015 will be applicable for Financial statements under CA’ 2013

Co

mp

an

ies A

ct

195

6

Clause 32 of the Listing Agreement mandates Listed Companies to prepare CFS

Neither AS 21 nor Companies Act 1956 requires other company to prepare CFS

Co

mp

an

ies A

ct

201

3

Mandatory for all Companies to prepare CFS in respect of the following entities:

Subsidiary Company

Associate

Joint Venture Company

CFS will have to be done in addition to SFS

CFS should be prepared in same form and manner as Standalone Financial Statement (SFS) of holding company.

To be audited and laid before AGM

Imp

act

All companies including private companies need to prepare CFS.

CFS should comply with notified AS

Exemption

F.Y. 01.04.2014 – 31.03.2015, Company having no subsidiary/ subsidiaries – CFS not applicable for Associate or Joint ventures.

From FY 01.04.2014 – CFS of foreign Subsidiary is not mandatory .

Consolidated Financial Statement – Sec 129 (3)

9

Net worth ≥ 500 crores Turnover ≥ 1,000 crores Net Profit ≥ 5 crores

CSR Committee

Consists of

3 or more

director out of

which

One director

independent

director

1. Formulate

and

recommend

CSR Policy

2. Recommend

amount of

expenditure

to be incurred

on activities

3. Monitor CSR

Policy

Company need to

spend minimum

2% of its average

net profits made

during the 3

immediately

financial years

Co

mp

osit

ion

Fu

ncti

on

s

Co

ntr

ibu

tio

n

10

CSR – Sec 135

11

FS including CFS Approved by the Board (Sec 179)

Signed by

Chair person when authorised

by Board

OR

Two Directors, out of which one shall be MD and CEO, when he is

a director

CFO

Company Secretary

In case of OPC , only by one director, to submit to the auditor, his report thereon.

Board to approve financial statement and Board’s report at the

meeting of the Board of Directors

Approval & Signing of FS

12

BR including Annexure

Signed by

Chair person when authorised by Board

OR

At least two Directors, out of which one shall be MD or by the Director, where

there is a director

Signing of Board’s report

13

Report of Auditors

New Format by ICAI in compliance with Companies Act, 2013

Companies (Audit Report) Order, 2015 (CARO)

Auditors’ report

Applicability of CARO

Applicable to all companies except

Banking/Insurance

OPC, Section 8 and Small Companies

Private Limited companies having

With paid up capital & reserves < Rs. 50 Lakhs and

Loans outstanding < Rs. 25 Lakhs from Banks & Financial Institutions and

Turnover < Rs. 5 Crores at any point during the financial year

14

Circulation of Financial Statements

Circulation to Members and other person entitled to receive.

21 days before meeting or as provided in Articles.

Circulate all documents which are to be laid at AGM, include

Signed Financial Statement, included consolidated FS,

Auditors Report

Board Report with Annexures

Other Doc as required by law

Circulation of Financial Statements

15

Form 23AC &

23ACA

Form AOC 4 Form AOC 4 (CFS) Form AOC 4 (XBRL)

FY before 01.04.2014 FY on or after

01.04.2014

FY on or after

01.04.2014

FY on or after

01.04.2014

All companies

(including XBRL)

Companies other

than XBRL & CFS

Companies with CFS Companies with XBRL

All Listed cos and subsidiaries

In case of other companies

Paid up share capital - 5Crs or above or

Turnover Rs 100 crores or above

Cos. which have hitherto filed in XBRL

Company shall file the

financial statements of its

subsidiary or subsidiaries

which have been

incorporated outside India /

which have not established

their place of business in

India with the ROC

Forms & Attachments

16

Financial statements duly authenticated as per section 134.

Auditors’ report

Board’s report

Form AOC-1

Company CSR policy as per sub-section (4) of section 135

Form AOC-2 - features and justification for entering into contracts/ arrangements u/s 188

Secretarial Audit Report

Statement of the fact and reasons for not adopting balance sheet in the annual general meeting

Statement of the fact and reasons for not holding the AGM

Approval letter of extension of financial year or AGM.

Details of other entity(s).

Attachments to AOC 4

17

FS including CFS

Adopted at the AGM

Within 30 days from the date of AGM or

within time prescribed u/s 403

Unadopted at the AGM or Adjourned AGM

Within 30 days of AGM

Registrar shall record the same as Provisional until

the filing adopted FS at the Adjourned Meeting

Adopted at the Adjourned AGM

Within 30 days of the adjourned AGM or within

time prescribed u/s 403

Due date for filing with ROC where AGM held

18

Consequence of Non Compliance

Liability on

The Company

Fine >Rs.50,000< Rs. 25 Lakhs

Company may be wound up by the Tribunal if

FS has not been filed for 5

Consecutive previous years

Officer in Default

Imprisonment which may extend to 3

years

Fine >Rs.50,000

<Rs. 5 Lakhs

Both

Consequences of Non – Compliance u/s 134

19

Liability on

The Company

Fine – Rs.1000 for

every day till default but

not more than Rs.10 Lakhs

Company may be wound up by the Tribunal if

FS has not been filed for

five Consecutive

previous years

MD & CFO, if any or Directors in charge, or all the directors

Imprisonment which may extend to 6

Months,

or

Fine >Rs.1,00,000<Rs. 5 Lakhs

Both

Consequences of Non – Compliance u/s 137

Disqualification u/s 164 (2) (a):

Every person who is or has been director of that company shall not be eligible for re-

appointment as Director of that company or appointed in any other company for a period

of five years from the date on which the said company fails to do so if the company has

not filed its financial statements for continuous period of three financial years

Section 455(1) explanation:

If the Company has not filed its Financial statements for last two financial years, it

will be termed as “inactive company”

Section 455(4)

If the Company has not filed its Financial statements for two financial years

consecutively, the Registrar shall issue notice to the Company and enter its name in

the Register of Dormant Companies.

20

Consequences of Non – Compliance u/s 137

Section 433 of CA’ 1956 [Section 271 under CA’ 2013 – not notified]

A company may be wound up by the Tribunal, -

If the company has made a default in filing with the Registrar, Financial Statements for

any five consecutive financial years.

Compounding of offence – Section 621A

Offence in respect of default in filing annual return is compoundable with the permission

of the Special court, in accordance with the procedure laid down in the Code of Criminal

Procedure, 1973 for compounding of offences.

As section 441 has not yet been notified, section 621A of the Companies Act, 1956 will

continue to be in force and under that section, the offence is compoundable by the

Company Law Board or where the maximum amount of fine which may be imposed for

such offence does not exceed fifty thousand rupees, by the Regional Director.

21

Consequences of Non – Compliance u/s 137

Point No. 4

Select an option from following available choices:

Provisional unadopted financial statements

Adopted financial statements

Revised financial statements u/s 130

Revised financial statements u/s 131

22

Practical Aspects

Point No. 8

23

Practical Aspects

Point No. 11

24

Practical Aspects

V – Cost Records & Profit & Loss Statement

25

Practical Aspects

V – Profit & Loss Statement

26

Practical Aspects

V – Profit & Loss Statement

27

Practical Aspects

V – Profit & Loss Statement

28

Practical Aspects

Segment II - IV – details of principal products

29

Practical Aspects

Segment III - CSR

30

Practical Aspects

Segment IV - RPT

31

Practical Aspects

Thank you for your kind attention