The news of Over 2 lakh directors to be barred from board posts for not complying with RoC filing has been driving awareness among startup community and entrepreneurs have started to acknowledge the fact that certain things no matter has to be performed as per law. This blog we shall look into what one has to do during the final countdown of RoC filing.
An annual return is a snap-shot of a company’s financial information as they stood on the closing of financial year. It is perhaps the most important document required to be filed by the company with the ROC. Apart from the financial statement, this is the only document which is compulsorily filed with ROC every year irrespective of any event or happenings in the company. While financial statements give information on the financial performance of the company, it is the annual return which gives detailed disclosure and deep insight of the non-financial information of the company viz. operations of the private limited company, funding, control and management.
Filing of the annual return yearly with the registrar of companies is obligation of the management of the company. It helps the stakeholders to ensure that the company is administered in a proper manner.
As per the provisions of Companies Act, 2013; every Company have to file e-form MGT-7 (Annual Returns) within 60 from the date of Annual General Meeting and AOC-4 (Annual Accounts) within 30 days from the date of Annual General Meeting.
Every company prepare a return (hereinafter referred to as the annual return) in the prescribed form containing the particulars as they stood on the close of the financial year regarding –
- Its registered office, principal business activities, particulars of its holding, subsidiary and associate companies;
- Its shares, debentures and other securities and shareholding pattern;
- Its indebtedness;
- Its members and debenture-holders along with changes therein since the close of the previous financial year;
- Its promoters, directors, key managerial personnel along with changes therein since the close of the previous financial year;
- Meetings of members or a class thereof, Board and its various committees along with attendance details;
- Remuneration of directors and key managerial personnel;
- Penalty or punishment imposed on the company, its directors or officers and details of compounding of offences and appeals made against such penalty or punishment;
- Matters relating to certification of compliances, disclosures as may be prescribed;
- details, as may be prescribed, in respect of shares held by or on behalf of the Foreign Institutional Investors indicating their names, addresses, countries of incorporation, registration and percentage of shareholding held by them; and
- Such other matters as may be prescribed, and signed by a director and the company secretary, or where there is no company secretary, by a company secretary in practice: Provided that in relation to One Person Company and small company, the annual return shall be signed by the company secretary, or where there is no company secretary, by the director of the company.
Guidelines on annual filing
DIN (Director Identification Number) and DSC (Digital Signature Certificate)
Intimation about the Auditor of the company
Within 15 days of AGM
– Consent letter from the Auditor.
– Intimation to the Auditor.
– Extract of the AGM.
Within 30 days of AGM
– Financials of the company.
– Director Report.
– Auditor’s Report.
Within 60 days of AGM
For filing XBRL document in respect of financial statement and other documents
Within 29th October
– Financial Statements
Signing of Documents
The Annual return of the Company must be signed by the Directors of the Company. The financial statements filed along with the Annual return must be audited and signed by a Chartered Accountant. Where there is no company secretary, by a company secretary in practice: Provided that in relation to One Person Company and small company, the annual return shall be signed by the company secretary or where there is no company secretary, by the director of the company.
When is the due date for filing annual returns?
Annual return is due before the 29th October this year or 6 months from the end of the financial year. In case of newly incorporated Company, an Annual General Meeting should be held within 18 months from date of incorporation or 9 months from the date of closing of financial year, whichever is earlier and an annual return should be filed with the MCA.
Procedure for annual return filing
Step 1: Preparing Financial Statements of the Company:
All companies are required to prepare financial statements of the company based on the Book of Accounts. Financial statements means any statement to provide information about the financial position, performance and changes in the financial position of an assessed and includes balance sheet, profit and loss account and other statements and explanatory notes forming part thereof.
Step 2: Appointing Auditor for the Company
Every Company must appoint its first Auditor within one month of the registration of the company. Any person who is a qualified Chartered Accountant in practice or a firm of Chartered Accountants can be appointed as the Auditors of the Company. However, the following persons / entities cannot be appointed as Auditor of a Company:
- A body corporate;
- An officer or employee of the company (irrespective of if he/she is a qualified Chartered Accountant);
- a person who is a Partner or Director of the company;
- A person who is indebted to the company;
- A person who is in whole time employment elsewhere;
It is important to remember that the Auditor of the Company must be independent and not having bias towards the company. The term of an Auditors appointment would end at the conclusion of the Annual General Meeting of the Company; the company may re-appoint the same Auditor or may decide to replace the Auditor.
Step 3: Auditing the Financial Statement of the Company:
Audit plays an important role in the management of the Company. As per Companies Act, 2013 every company should appoint an Auditor to audit the accounts of the company and present their report on the accounts. The Auditor after being appointed by the Company would audit the financial statements of the Company and submit his/her report on the accounts of the Company to the members. The Auditor is also required to state in his report whether the accounts of the Company give a true and fair view of the state of affairs of the Company.
If the Auditor is not satisfied with the information / clarification provided in the financial statements of the Company, or if the Auditor has any reservation in respect of the account or book of accounts maintained by the Company, then he/she can bring the facts to the attention of the stakeholders by Qualifying the Audit report.
Step 4: Conducting Annual General Meeting
An Annual General Meeting is a meeting of the shareholders of a Company held every year. Companies Act, 2013 mandates that all company except One Person Company hold one Annual General Meeting every year. No company is exempt from this requirement. The date of any Annual General Meeting must be within 15 months from the date of immediately preceding Annual General Meeting. However, for a newly incorporated company, the first Annual General Meeting must be held within 18 months from the date of incorporation of the Company.
Step 5: Acquiring Documents
Arranging the documents together like financial statement of the company. Examples, At the Annual General Meeting, the audited financial statements of the Company with the Auditor’s Report and Directors Report are placed before the members of the Company. The members of the Company on being satisfied about the financial statements of the Company can adopt the Annual Accounts of the company after due consideration. The financial statements of a company are considered final only after it is approved by the Shareholders of the company in the Meeting.
Step 6: Form Filing
File the respective documents as mentioned on the above table.
Step 7: Pay Fee and charges for forms
Company having Authorized Capital of INR 1 Lakh is INR 300 for each Form AOC-4 and MGT-7, and Company having Authorized Capital of INR 5 Lakh or more is INR 400 for each Form.
Hence, A Company is required to file its balance sheet, profit and loss account, auditor’s report and annual return every financial year before the due date with the registrar of companies. Noncompliance with this provision will attract a fine that is charged while filing the e-Form. And, non-compliant with Income Tax filing, will restrict you from carrying your losses forward.
We at Wazzeer have built a smart platform of Legal and accounting professionals which include Chartered accountants, Company secretaries and corporate lawyers from different parts of the country. We can help your company in taking care of all the compliance related projects so that you can take the back seat and enjoy brainstorming sessions for your venture.
Please go through the below mentioned information which clarifies the list of Documents, Scope of work, Timeline and Pricing for filing the ROC and IT returns for your company.
Entrepreneurs generally are interested in these frequently asked questions :
Q1. What is the scope of work?
- Annual Returns filing to RoC for the Financial Years ending March 31, 2017
- Profit & Loss Statement filing to RoC for the Financial Years ending March 31, 2017
- Audit Report filing to RoC for the Financial Years ending March 31, 2017
- Income Tax Returns filing to IT Department for the Financial Years ending March 31, 2017
Q2. How much time does it take?
7-8 Working days.
Q3. How much will it cost?
Govt. Fees for the financial year ending March 31, 2017 – INR900/- (AOC-4, MGT-14 and ADT-1)
Professional Fees- In case of 0-10 Transactions – INR 8850 including GST charges (Fees- 7500 INR and 18% GST)