MCA CIRCULAR DATE 31ST JULY 2018 – CHANGES IN BOARD’S REPORT FOR OPC AND SMALL COMPANIES
MCA
has further amended the Companies (Accounts) Rules, 2014. These rules are now
referred as the Companies (Accounts) Amendment Rules, 2018.
COMPANIES (ACCOUNTS)
AMENDMENT RULES,
2018
New Rule 8A of the COMPANIES (ACCOUNTS) AMENDMENT
RULES, 2018 prescribed abridged form of
Directors Report for One Person Company and Small Company.
New Rule 8A
MCA has introduced
new Rule 8A after rule 8 under Section 134 of Companies Act, 2013
MEANING OF ONE PERSON COMPANY
One Person
Company is defined in Sub-Section 62 of Section 2 of Companies Act, 2013, which
reads: "One Person Company means a company which has only one
member". Under this type of Business Entity, there is no need for
mandatory minimum two directors, as is the case in Private Limited Company
incorporation.
MEANING OF A SMALL COMPANY
Section
2(85) of the Companies Act, 2013 defines “Small Company” in the following
manner:
Small
company’’ means a company, other than a public company,-
1.
paid-up
share capital of which does not exceed fifty lakh rupees or such higher
amount as may be prescribed which shall not be more than five
crore rupees;
2.
turnover
of which as per its last profit and loss account does not exceed two crore
rupees or such higher amount as may be prescribed which shall not be more
than twenty crore rupees:Provided that nothing in this clause shall apply toA)
a holding
company or a subsidiary company;
B) a company
registered under section 8; or
C) a company or body corporate
governed by any special Act;
“Matters to be included in
Board’s Report for One
Person Company and Small Company”
Rule 8A: As per rule
8A “Matters to be included in Board’s Report
for One Person Company and Small
Company:
NO REQUIREMENT OF MGT-9 FOR
OPC AND A SMALL COMPANY
Now , OPC and a Small Company need not to prepare
MGT-9 and to enclose along with the Board’s Report .
“STAND ALONE FINANCIAL
STATEMENT”
Director’s report of
OPC and Small Company shall be prepared on the basis of “Stand Alone Financial
Statement” of the Company.
INFORMATION TO BE CONTAINED
IN THE DIRECTORS REPORT OF OPC AND SMALL COMPANY.
Annual
Return in the Director’s Report
|
There
is no need to attach MGT-9 along with the Directors Report of OPC and Small
Company. It is adequate that the web link, if any, where annual return
referred to in sub-section (3) of section 92 has been placed;
|
Number of
Board Meetings held
|
Details
of the number of Meeting of Board of Directors
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Directors
Responsibility Statement
|
Directors
responsibility statement as referred in sub-section 5 of section 134
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Details of
the Frauds Reported in the Auditor’s Report.
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Details
in respect of frauds reported by auditors under sub-section (12) of section
143 other than those which are reportable to the Central Government.
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Board’s
Comment on Auditor’s Qualification
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Explanations
or comments by the Board on every qualification, reservation or adverse
remark or disclaimer made by the auditor in his report.
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The state
of the Company’s affairs;
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Details
discussion about the company’s affairs in the Directors report.
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The
financial summary and highlights;
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To
provide synopsis of financial metrics of the company
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Details
about material changes if any in the company during the year
|
Material
changes from the date of closure of the financial year in the nature of
business and their effect on the financial position of Company.
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The details
of directors who were appointed or have resigned during the year;
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Appointment
of Directors or resignation of directors during the year.
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Outcome of
Litigations
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The
details or significant and material orders passed by the regulators or courts
or tribunals impacting the going concern status and company’s operation in
future.
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FORM AOC-2
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The
report shall contain the particulars of contracts or arrangements with
related parties referred to in sub section (1) of section 188 in the form
AOC-2.
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