Secretarial & FEMA
A secretarial audit provides a thorough examination of the company’s adherence to all applicable laws, including the SEBI Act, Companies Act, Depositors Act, FEMA, Legal Services, and other sector-specific regulations. The SEBI Act, its rules, and circulars made under it are included in a secretarial compliance report.
Legal, secretarial, and FEMA services for corporations
- Statutory Registrations under several laws, such as the Import-Export Code License (IEC), the Shops and Establishments Act, the Trademark Act, the Workers State Insurance Act (ESI), the GST, the Provident Fund Act (PF), and the Employees State Insurance (PAN & TAN) Act.
- XBRL reporting and compliance with the 2013 Corporations Act
- External Commercial Borrowings (ECB), Foreign Direct Investments (FDI), Overseas Direct Investments (ODI), Securities and Exchange Board of India (SEBI), FLA/FLAIR report filing, etc. are examples of compliances under the Foreign Exchange Management Act (FEMA).
- Prose shareholder & joint venture agreements, contracts, memorandums of understanding, etc.
- Business closure procedures including winding up, being struck off, going into liquidation, and fast track exit mode
- Legal advice on corporate concerns
- CSR Policy Formulation & Implementation
- Legal assistance with corporate and labor-related issues
- Services for arbitration and dispute resolution
- Administrative Compliances
- Secretarial assistance for continuing Companies Act, 1956, compliances, etc.
- “RBI/FEMA Compliances,” 12.
- Compliance with the Foreign Exchange Management Act
- Filing of FLA/FLAIR returns
- Advice and Help in Securing External Commercial Borrowing
- Overseas Direct Investment (ODI) and Foreign Direct Investment (FDI) Advice & Compliances (ODI)
Secretarial Compliances
A group of people who contribute money or money’s worth to a shared resource pool and work together to achieve a common goal is referred to as a company. A corporation that registers under the Companies Act of 2013 gains the status of a legal entity with a distinct legal identity. Secretarial Compliance & Secretarial Audits have been made mandatory for a particular type of firms in order to spot instances of non-compliance and take corrective action to protect the interests of diverse stakeholders. The following are among the primary characteristics of a business registered or incorporated under the 2013 Companies Act:
- A corporation receives the status of an artificial judicial person identity upon registration under the 2013 Companies Act, which is distinct from that of its members and directors. This feature allows a shareholder or member to contract with the company and to bring legal action against the corporation or be sued by it. A business can also sign contracts, buy property, open bank accounts, borrow money, and take on liabilities.
- Members of the company are not responsible for the debts of the firm because the company is independent from them and acts as such. Their liability is capped at the value of the shares they own or at the value of the guarantee.
- Regardless of the differences in its membership or directors, the business is a legal fiction with a perpetual existence.
- A person or a firm cannot sign their own name because they are artificial entities. As a result, it necessitates the creation of a common seal that can be applied to choices taken on the company’s behalf.
All listed businesses and its asset unlisted subsidiaries are required to submit a Secretarial Compliance Report to the stock exchanges where the firms’ securities are listed within 60 days of the end of the Financial Year in accordance with Regulation 24A of the SEBI Regulations (LODR). The SEBI Act, its regulations, circulars, orders, and guidelines, which are a comprehensive set of laws with extensive coverage over the capital market, are the only laws covered by the secretarial compliance report.
Every company that is incorporated under the Companies Act is required to comply with a number of regulations. These are a few of the compliances:
- Assignment, stipulation, compensation, and retirement of the company’s directors;
- The company’s statutory auditors are appointed;
- Calling and running a Board of Directors meeting;
- Organising and holding the annual general meeting of the shareholders/members
- Creating and presenting the company’s yearly reports and maintaining its accounting records on a regular basis;
- Submitting annual financial accounts to the company’s registrar;
- Upkeep of accounting records in accordance with the accrual system;
- Notification of deposits, loans, etc. to the Registrar of Companies
The repercussions of non-compliance are extensive and foresighted.
How SalahKaro Helps in Secretarial Audit
At SalahKaro, we employ Company Secretaries and other professionals who are knowledgeable about Indian company law, assist with secretarial compliance and secretarial audit issues, continuously monitor the regulatory landscape in India, and quickly help our clients form companies in accordance with the Companies Act. We mostly provide the following services:
- Assistance with the drafting of the application form, memorandum, and articles of association and submission of the same with the Registrar of Companies in India for the incorporation of the company;
- Help with submitting an application to the Registrar of Companies and obtaining the certificate of establishment of a business
- Preparation of minutes of the meeting of the Board of Directors and members;
- Assistance with regard to the holding, conducting, and voting at meetings required by the Companies Act;
- Assistance with filing annual returns and other papers in accordance with regulations.
FREQUENTLY ASKED QUESTIONS
. The secretarial audit requirement has been mentioned under section 204. The secretarial audit is mandatory for the following classes of companies:
- Every listed company
- Every public company with
- Paid-up share capital of Rs. 50 crores or more
- Turnover of Rs. 250 crores or more
- Outstanding loans or borrowings from banks or public financial institutions of Rs. 100 crores or more
The extent of secretarial compliances applicable to the companies depends upon the operations and laws applicable to the companies. This can include:
- Maintenance of statutory registers
- Annual filings
- Change in statutory auditors
- Admission or retirement of directors
- Filings with sectoral regulators etc.
- Submission of various reports and returns
Non-compliance can attract mild to severe penalties depending upon the nature of non-compliance. In certain serious non-compliances, the name of the company can be struck off from the register of the companies.
