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What is a secretarial audit?
Secretarial Audit is basically an audit to ascertain the level of compliance of various company laws, mainly the Companies Act and other corporate and allied laws applicable to the company like FEMA, SCRA, SEBI,etc. It is to be conducted as per Regulation 24A and Section 204 of the Companies Act, 2013 read with Rule 9 of the Companies (Appointment and remuneration of managerial personnel) Rules, 2014.
Who shall conduct a secretarial audit?
Currently, Secretarial Audit by Practicing Company Secretaries (PCS) is mandatory for listed companies and unlisted companies with the above certain threshold in Form MR-3.
Secretarial Audit Report to be annexed to Board’s Report.
Board is required to explain in its Report any qualifications made by PCS in his/her Report
For contravention – company, every officer who is in default and PCS punishable with fine – Rs 1 lakh to Rs 5 lakh
Secretarial Compliance Report:
SEBI had come out with the circular CIR/CFD/CMD1/27/2019 date 08th February, 2019 mandating all listed companies to submit, in addition to Secretarial Audit Report, Secretarial Compliance Report to the stock exchanges within 60 days of closure of financial year. Secretarial Compliance Report covers SEBI Act, regulations and circulars issued thereunder.
Penalty for non -submission of Report is Rs. 2000 per day of default.
Recently, NSE has come out with Circular Ref No. NSE/CML/2023/39 for Filing of Annual Secretarial Compliance Report (ASCR) in XBRL format on NEAPS platform o be available from June 15, 2023 and due date is June 30, 2023
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