The process of Company Compliance typically includes the following key aspects:
- Annual General Meeting (AGM): Companies are required to hold an AGM within six months from the end of the financial year, where shareholders discuss and approve various matters such as financial statements, dividend declarations, and appointment of auditors.
- Annual Returns (Form MGT-7): Companies must file an annual return with the Registrar of Companies (RoC) within 60 days of holding the AGM. This form includes details of the directors, shareholders, and any changes during the year.
- Financial Statements (Form AOC-4): Companies must file their financial statements, including the balance sheet, profit and loss account, and cash flow statement, with the RoC within 30 days of the AGM.
- Income Tax Returns: Companies must file their income tax returns annually by the due date, typically 30th September if audited.
- Board Meetings: Companies must hold a minimum of four board meetings in a year, with a gap of not more than 120 days between two consecutive meetings.
- Statutory Registers and Records: Companies must maintain various statutory registers such as the register of members, register of directors and key managerial personnel, and minutes of board and general meetings.
- Event-Based Compliances: This includes filing forms for events such as a change in directors, change in registered office, increase in authorized capital, or alteration of the memorandum and articles of association.
Who Should Consider Company Compliance? Company Compliance is mandatory for:
- Private Limited Companies: All private companies registered under the Companies Act, 2013.
- Public Limited Companies: All public companies registered under the Companies Act, 2013.
- One Person Companies (OPCs): OPCs registered under the Companies Act, 2013.
Advantages of Company Compliance Company Compliance offers several advantages:
- Legal Standing: Ensures that the company maintains its legal status and avoids penalties or legal issues.
- Credibility: Enhances the credibility and trustworthiness of the company in the eyes of stakeholders, investors, and clients.
- Financial Health: Regular compliance and audits help in maintaining the financial health and transparency of the company.
- Operational Efficiency: Adhering to compliance norms ensures smooth and uninterrupted business operations.
- Avoiding Penalties: Timely compliance helps avoid hefty penalties and legal repercussions.
Conclusion Company Compliance is a critical aspect for all companies in India to ensure legal standing and operational efficiency. Adhering to statutory requirements such as holding AGMs, filing annual returns, maintaining financial records, and fulfilling auditing requirements is essential for the smooth functioning and credibility of the company. Proper compliance not only helps in avoiding penalties but also enhances the overall trustworthiness and financial health of the company.