Secretarial Audit under the Companies Act 2013

The companies’ act 2013 has given substantially a prime focus to the Secretarial audit pursuant to the Section 204 of the Companies Act 2013. The certificate is to be issued in accordance in line with the rules and guidelines of Companies (Compliance Certificate) Rules, 2001 which constitutes a 33-item for Compliance Certificate.

The secretarial audit is a tool for the regulators as well as the board of directors to ensure and monitor compliances pursuant to various Corporate Law and other relevant laws, rules, regulations, and procedures etc. Secretarial Audit is the part of Legal compliance reporting system. The secretarial Audit also reinforces the faith of the shareholders that the company directors are working in bona fide interest for the company and are compliant with respect to applicable laws. A member of the Institute of Company Secretaries of India, holding a certificate of practice, can conduct a secretarial audit. The Company Secretary shall thereafter furnish the official Secretarial Audit Report to the Company. In the case of false reporting, pursuant to Section 204 (4) the punishment and penal consequences are imposed, even the company secretary in practice can be punished. It also helps the Government of India to conceive the compliance status of the company. Pursuant to section 383 A (1) of the Act a company having paid up share capital of Rs 10 lakhs or more and is required to employ a whole-time secretary and has to file with the ROC a certificate from a secretary in whole time practice. A copy of such certificate shall be attached with Board’s report. The report should be issued by CS after reviewing and inspecting the relevant documents of the company. The secretarial audit report must cover the Scope, Content, and Criteria of the audit and the status of the required compliance under applicable law. Click here to know more about this