Signing balance sheet by video conferencing

Dear All,

Now since video conferencing has been allowed, can a balance sheet approved through video conferencing be signed by two directors sitting at different places by fax or email (one at delhi and other in mumbai) before forwading the same to the auditors as per section 215 and then adopted by the board in the same meeting after getting the scanned/fax copy of auditors report in the same board meeting.

For example: Is it correct to sign the balance sheet in the following fashion:

During the board meeting the MD signs the balance sheet send the scanned copy to delhi for signing of other director other director signs it and send it to auditors for audit report and finally auditors sitting in delhi give report to the board on the same day on the basis of scanned copy.

Auditor Managing Director Director

Delhi Mumbai Delhi

10.06.2013 10.06.2013 10.06.2013

Regards

Board only approves the draft Balance Sheet placed before it. In the case cited by you, it will be perfectly in order if directors and auditors sign on same day at different places. Though in practice, accounts are signed on the date of Board meeting itself. However, legally it is not necessary. After getting approval of the Board, the directors can sign the accounts even on different dates and at different places. Only point to be noted is that auditors' report cannot be dated prior to the last date of signing by the directors and directors' report cannot be dated prior to the auditors' report since directors report must contain comments on qualifications, if any, in the audit report. In such a situation, a separate Board resolution may be required for approving directors' report.

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Sandeep

P C Agrawal

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