Secretarial Audit Package for Companies
A Secretarial Audit is an examination of the company’s compliance with various laws, including the Companies Act and other cooperative and economic laws. Legaltoast, one of the leading taxation and audit consultancies, can perform your Secretarial Audit. To avail our services, we charge 499/- as an advance or security payment.
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What is a Secretarial Audit?
A secretarial audit is a component of a company’s overall compliance management system. It’s a technique for ensuring that legal and procedural requirements are followed and adhered to. The secretarial Audit is a useful technique for ensuring business compliance. It also aids in the detection of noncompliance and the implementation of appropriate measures. Secretarial auditing is a process that examines a company’s compliance with a variety of laws, rules, regulations, and processes, as well as records, accounting, and bookkeeping. An independent specialist might take over the Company’s Secretarial Audit. Whatever the case may be, the secretarial Audit adheres to the established procedures. It’s mostly used to keep track of whether or not stated laws are being followed.
Which Businesses Must Have A Secretarial Audit?
It is mandatory for the following companies related to the secretarial Audit’s applicability and has to be followed. These are mentioned below:
- Every Listed Company
- Every public Company (Conditions apply)
When it comes to a publicly traded corporation, there are a few limitations:
- Only public companies have a paid-up share capital of over Rs. 50 crore and a turnover of over Rs. 250 crore are eligible.
- If one or more of the conditions are met, a secretarial audit is also required.
- A practising Company Secretary has also been approved to undertake a secretarial audit for businesses.
Who Can Serve as a Secretarial Auditor?
Members of the Institute of Company Secretaries of India with a certificate of practice allow them to conduct secretarial audits and provide the Secretarial Audit Report to the company or organization. They can only conduct secretarial audits and provide the Secretarial Audit Report to the company or organization.
What Services Does The Secretarial Audit Provide?
A secretarial audit is a process that checks a company’s compliance with the Corporate Law and other relevant laws, regulations, rules, and procedures, etc. The secretarial Audit examines the company’s compliance with various laws, including the Companies Act and other corporate and economic laws. It was enacted under Section 204 of the Companies Act of 2013. Under this, the regulators monitor the companies to ensure that they are complying with the stated laws and processes.
Every business must follow government rules, regulations, and laws. Noncompliance with the regulations can be risky for the company. Organizations must conduct a periodic review of their work in order to identify errors and maintain a strong compliance mechanism system in any organization.
It is claimed that periodic inspections of the records provide the Authority with precise information about its compliance policy.
A detailed secretarial audit helps:
- To review compliance reports.
- To safeguard the interests of employees, customers, society, and so on.
- To avoid any unnecessary legal actions by law enforcement.
- To point out inadequate compliances and noncompliances.
- Ensuring that the procedural and legal requirements suitably comply is important for any company’s image and goodwill.
Benefits of Secretarial Audit
- Having a secretarial audit will assist your organization in having an effective mechanism to ensure compliance with legal and procedural requirements.
- It promotes trust among directors and Key Management Personnel (KMP), among others.
- The company directors can focus on important business matters and meet only when the Secretarial Audit ensures that legal and procedural requirements are safer, better, and more audible.
- As a result, it contributes to lessening the workload of law enforcement officials.
- By doing so, you demonstrate to investors that you are on the right track by displaying your legal records.
- Secretarial auditing is an effective governance and risk management tool. It produces the result in a much more efficient manner.
Documents Required For Secretarial Audit
- Audited financial statements
- Charter Documents
- Filings with RBI (If there is a foreign investment)
- Board and General Meeting Minutes & Notices thereto
- Last year Secretarial Audit Report
- Directors’ disclosures and declarations for the code of conduct, filings and notifications with the Registrar of Companies, stock exchanges, and newspaper advertisements (if Listed)
- Annual Performance Reports, Lease Deeds, LUT Cum Bonds, and Softex Returns are all available.
- Statutory Registers
- Filings with other statutory departments
- ECB Returns (if there are foreign borrowings in the company)
- Sitting fees and Remuneration details paid to directors, Bank account details for dividend
- Proof of spending CSR amount
- SAST Disclosures
- Registers maintained under Labour Laws
procedure for Secretarial Audit
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FAQs on Secretarial Audit Package for Companies
As per Section 204(1) of Companies Act, 2013, the following companies are required to obtain Secretarial Audit Report in Form MR-3:
- Every Listed Company
- Every Public Company having a paid-up share capital of Rupees 50 Crores or more
- Every Public Company having a turnover of Rupees 250 Crores or more