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Introduction Secretarial Audit is a compliance audit and it is a part of total compliance management in an organization. The Secretarial Audit is an effective tool for corporate compliance management. It helps to detect non-compliance and to take corrective measures. Secretarial Audit is a process
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FAQ :
A Secretarial Audit is a compliance audit and an effective tool for corporate compliance management. It involves an independent professional checking a company's adherence to various laws, rules, regulations, and procedures, as well as the maintenance of its books and records.
Before the Companies Act, 2013, Secretarial Audit was not mandatory. Section 204 of the Companies Act, 2013, introduced the requirement for certain companies to conduct a Secretarial Audit.
The Companies Act, 2013, mandates Secretarial Audits for listed companies, public companies with paid-up share capital of ₹50 crore or more, public companies with a turnover of ₹250 crore or more, or any company with outstanding loans/borrowings from banks/financial institutions of ₹100 crore or more.
The Secretarial Audit Report is to be given by a Company Secretary in practice in Form MR-3, and it must be annexed with the Board's Report.
Documents required include MOA, AOA, shareholding agreements, filings with regulatory authorities, prospectus records, related party transaction statements, statutory registers, financial statements, and minutes of meetings.
The process involves appointing the auditor through a Board Meeting resolution, issuing a formal letter of appointment, and the auditor confirming their acceptance in writing.
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