What is compliance in business, in short? It means to comply with laws and regulations.
Below are the Important Compliances for Companies :-
BOARD MEETINGS for Companies.
Minimum 4 Board Meetings to be held every year with not more than 120 days’ gap between two meetings.
ANNUAL GENERAL MEETING (Within 180 days from end of financial year)
- As per Section 96 of the Companies Act, 2013 every Company, other than One Person Company (OPC), must hold a general meeting in each year apart from other meetings as Annual General Meeting (AGM).
- The first AGM must be held within six months from the closing of the first financial year.
- After the first AGM, for every subsequent year, AGM must be held within a period of six months from the date of closing of the financial year.
- Notice: A 21 clear days’ notice is required to be given for the same.
- DIRECTOR’S REPORT – According to section 134 of Companies Act, 2013 with the financial statements laid before a company in general meeting there shall be attached a report by its Board of Directors which shall include all the particulars stated in the section.
AUDITOR APPOINTMENT (15 Days from AGM)
- All the companies registered in India are required to appoint a Statutory Auditor within 30 days of the incorporation of the Company which should be intimated to the Registrar of Companies by filing FORM ADT-1, however it is not necessary.
- This form is also required to be filed every time of appointment/ Re-appointment after the end of the term. It must be filed with the registrar of companies within 15 days from the date of appointment of the Auditor.
- If the company’s AGM was held on 30th September, then form ADT- 1 has to be filed by 15th October.
MCA FORM AOC-4 (Within 30 Days from AGM)
- Every company registered in India, has to prepare and file its financial statements with MCA in Form AOC-4 every year. The form should also be attached with Auditor’s report, Board’s report, details of CSR policy, Statement of subsidiaries, if any, etc.
- Due Date : The form has to be filed within 30 days of the company’s annual general meeting. In case of One Person Company, the time period to file the form is 180 days from the closure of the financial year.
- Penalty : In case of failure to file AOC-4 with the financial statements before the due date, there shall be levied a fine of Rs. 100/- per day
MCA FORM MGT-7 (Within 60 days from AGM)
- All the companies, whether public or private registered in India must file the Form MGT-7 every year. It is an electronic form provided by MCA to all the corporate in order to file their annual return details.
- Due Date : Form MGT-7 is required to be filed within 60 days following the AGM.
- Penalty : In case of delayed filing of form MGT-7 a penalty of Rs. 100 per day during which the failure continues shall apply.
FORM DPT-3 (90 days from end of financials year)
- With a spate of corporate irregularities coming to the fore, the Centre has decided to make disclosure norms more stringent. Corporate India is now required to submit details of transactions involving the receipt of money or loans taken by them, which are otherwise not considered deposits.
- Due Date : Every company shall on or before the 30th day of June, of every year, file a return of deposit with the Registrar and furnish the information contained therein as on the 31st day of March of that year duly audited by the auditor of the company.
- Penalty On the defaulting company : A fine of minimum Rs. 1 crore or twice the amount of deposit so accepted, whichever is lower, which may extend to Rs.10 crores; and Every Officer who is in default: imprisonment up to seven years and with a fine of not less than Rs. 25 lakh which may extend to Rs.2 crores.
INCOME TAX RETURN (180 days from the end of financial year)
- Every company registered in India has to file Income Tax return irrespective of any income, profit or loss. Even the dormant companies with no transactions are required to file the return.
- The companies registered in India must file ITR-6 to submit their return.
- Due Date : The due date to file income tax return is 30th of September.
- Penalty : Failure to file income tax return would attract a penalty of Rs. 10,000/-
GST, PF PT, ESI, TDS
- Every registered under GST, PF, ESI, PT in India has to file the return.
- Due Date : –
GSTR-3B: 20th of the following month, GSTR-1: 11th of the following month
PF, PT, ESI: 15th of the following month (only PF and ESI registered)
TDS: 7th of the following month if TDS deducted.
DIN EKYC (180 days from the end of financial year)
- As per Ministry of Corporate Affairs, if any person has been allotted “Director Identification Number” and the status of such DIN appears to be Approved then such Director needs to file a form to update DIR-3 KYC details in the system. Disqualified directors are also required to file form DIR-3 KYC.
- Due date : It should be done before 30th Sept of the immediately next financial year.
- Penalty : If a Director, fails to file eform DIR-3 KYC before the expiry of the due date, then MCA21 system will mark his/her DIN as ‘De-activated’ with reason as ‘Non-filing of DIR-3 KYC’.
- The de-activated DIN shall be re-activated only after eform DIR-3 KYC is filed along with payment of Rs. 5000.
MSME COMPLIANCE (Half Yearly)
- With a spate of corporate irregularities coming to the fore, the Centre has decided to make disclosure norms more stringent. Specified Companies (Furnishing of information about the payment to micro and small enterprise suppliers).
- Every specified company shall file in MSME Form I details of all outstanding dues to Micro or small enterprises suppliers (whose payment is due or not paid within 46 days) dealing with MSME shall mandatorily file a return with MCA in e-form MSME-1.
- Half Yearly Return & Due Date :
- For Half year period ‘April to September’ – 31st October.
- For half year period ‘October to March’ – 30th April.
- Penalty for non-compliance : Any company that fails to comply with these provisions will be required to remit a fine of up to Rs. 25,000;
- While the breaches of a Director, CFO or CS would qualify for a period of imprisonment of up to six months or a fine ranging from Rs. 25,000 to Rs. 3,00,000.
As per Companies Act, 2013, every company, irrespective of its sales turnover or nature of business or capital must have its book of accounts audited each financial year. Thus, the Board of Directors of a Company are required by law to appoint an Auditor within 30 days of incorporation and thereafter conduct an audit of its financial statements each financial year.
Process for Statutory Audits The time duration for completing a statutory audit would depend on the audit objectives and scope.
Based on the data and information gathered in the audit, the Statutory Auditor would prepare an Audit Report and express an opinion of it the financial statements portray a true and fair view.
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