If a Company gets to know from an internal audit that , the net profit for the financial year 21-22 is more than 5 crores, will the CSR becomes applicable to the Company from there onwards OR the Company shall wait for the Audited Financials to be made public (till AGM to be held in September) and based on the audited financials, the CSR becomes applicable?
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Applicability of CSR in case of unaudited figures
Replies (4)
Quick Summary
As per the Companies (CSR Policy) Rules 2014, 'net profit' means the net profit of the company as per its financial statements prepared in accordance with the applicable provisions of the Act,.....
So in my opinion, in the above scenario, the CSR becomes applicable when the financial statements are prepared by the company. There is no need to wait for 'audited financials'.
In my opinion, the CSR provisions will apply during the FY 2022-23.
Since the management prepares the financial statements and the auditor only gives their opinion, the liability to make CSR expenditures will apply before the ABS is filed.
CSR calculated for fy 21-22( 2% of average profits of last 3 years) has to be paid before March 2023. so do from audited balance sheet of fy 21-22 only
CSR provision applicable on the basis of immediate Preceding FY ( Net Worth / Turnover or Profit ) ,So On the basis of audited F/S of FY 21-22 ,for next FY CSR is applicable and remains applicable for next 3 Consecutive FY ( even in shortfall in successive years and till it not in shortfall for consecutive 3 Yrs )
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