Secretarial Audit is compliance audit, it is a part of total compliance management in an organization. The Secretarial Audit is an effective tool for corporate compliance management. The Secretarial Audit is an audit where the Secretarial Auditor expresses an opinion as to whether there subsist appropriate systems and processes in the company proportionate with the size and operations of the company to monitor and check compliance with applicable laws, rules, regulations, and guidelines.
Secretarial Audit (CS Professional) An audit is defined as a detailed analysis and verification of the accounting records and transactions of a business or an organization. Secretarial Audit under Companies Act, 2013 aims at evaluating company’s compliances and abidance to statutory compliance as applicable to the company.
Applicability of Secretarial Audit:-
As per section 204 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, following companies are required to obtain ‘Secretarial Audit Report’ form independent practicing company secretary;
(1) Every listed company
(2) Every public company having a paid-up share capital of Fifty Crore rupees or more, or
(3) Every public company having a turnover of Two Hundred Fifty Crore rupees or more.
Required Documents for Secretarial Audit
Below-mentioned documents are required for Secretarial Audit-
- Charter Documents and Statutory Registers,
- Board and General Meeting Minutes & Notices,
- Audited financial statements and Last year Secretarial Audit Report,
- If the company is listed, Filings & Intimations with ROC, Stock Exchanges, Newspaper Advertisements.
- Annual Performance Reports, Lease Deed, Bonds and returns
- Filings with RBI (If there is a foreign investment) and other statutory departments,
- Registers maintained under Labour Laws
- Admission and Statement for code of conduct received from the directors
- Remuneration and Sitting fees details paid to directors.
- Particulars of CSR amount
- SAST Disclosures
- Bank account details for dividend
- Details of ECB Returns, in case of foreign borrowings in the company.
Applicability of Secretarial Audit:-
As per section 204 of the Companies Act, 2013 read with Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, following companies are required to obtain ‘Secretarial Audit Report’ form independent practicing company secretary;
(1) Every listed company
(2) Every public company having a paid-up share capital of Fifty Crore rupees or more, or
(3) Every public company having a turnover of Two Hundred Fifty Crore rupees or more.
Required Documents for Secretarial Audit
Below-mentioned documents are required for Secretarial Audit-
- Charter Documents and Statutory Registers,
- Board and General Meeting Minutes & Notices,
- Audited financial statements and Last year Secretarial Audit Report,
- If the company is listed, Filings & Intimations with ROC, Stock Exchanges, Newspaper Advertisements.
- Annual Performance Reports, Lease Deed, Bonds and returns
- Filings with RBI (If there is a foreign investment) and other statutory departments,
- Registers maintained under Labour Laws
- Admission and Statement for code of conduct received from the directors
- Remuneration and Sitting fees details paid to directors.
- Particulars of CSR amount
- SAST Disclosures
- Bank account details for dividend
- Details of ECB Returns, in case of foreign borrowings in the company.
FAQs
Qus:-Who can be appointed as secretarial auditor?
Only a practicing company secretary be appointed as Secretarial Auditor of the Company.
Qus:-Who can conduct the Secretarial Audit?
Only members of the Institute of Company Secretaries of India having COP (Certificate of Practice) can conduct Secretarial Audit and submit the Secretarial Audit Report in Form MR-3.
Qus:-What is the format of the Secretarial Audit Report?
Secretarial Audit Report is required to be provided in the format lay down in Form MR-3.