Conversion of firm into LLP

We have encountered an issue while attempting to fulfill the requirements for our Fillip form submission, which was initiated on 17/02/2024.

Upon filing the form, we received the following remark: Provide detailed Audited Financial statements (B/S with P & L) not older than 30 days along with notes & schedules. It should be at least signed by two partners.

In response to this remark, we promptly arranged for our books of accounts to be audited up to 31.01.2024. However, while trying to fill in the partner's contributions as per the audited report, we encountered a pop-up error stating Make sure that total monetary contributions are the same as entered in the Original Form.

To rectify this issue and proceed with the submission, we kindly request guidance on addressing the disparity between the partner's contributions as per the audited report and those entered in the original form.

Your assistance in resolving this matter would be greatly appreciated.

Attached File : 1743559 20240328182705 mca.pdf downloaded: 8 times

Hi Prasad,

The issue you're facing during the conversion of a firm into LLP via Form FiLLiP relates to a mismatch between the partner's monetary contributions as per the audited financial statements and the contributions previously declared in the original form (probably Form URC-1 or earlier filing).

Why this happens:

MCA portal expects the monetary contributions of partners entered in FiLLiP to exactly match the contributions declared in the initial registration form of the firm.
However, during audit, partner's capital contributions might get adjusted due to drawings, loans, or revaluation, causing mismatch.

How to resolve this:

Check the Original Form Details:
Revisit the original form filed with MCA (usually the URC-1 or LLP incorporation form) where partner contributions were declared. Note the exact amounts.
Adjust the Partner Contributions in FiLLiP:
- In FiLLiP, enter the partner contributions exactly as per the original form, not the audited figures.
- The portal validation requires this consistency.
Attach Audited Financials as Annexure:
- Upload the audited financial statements separately in the attachments section as required by MCA.
- The audited figures can differ, but the data entered in the form fields (contributions) must match the original filing.
Explain Discrepancies (if any):
- If MCA asks for clarifications later, you can provide a detailed note explaining the difference due to accounting adjustments or drawings.

Important:

The MCA system validations are strict for the form data, but actual financials can be attached as supporting documents.
If the difference is significant or if you want to reflect the audited figures, then you may need to revise or update your original filings before conversion.
Alternatively, consult your auditor or company secretary to ensure correct values.

Summary:

Enter the partner monetary contributions exactly as per original MCA filed form in FiLLiP.
Upload the audited financials as a supporting document.
Add a note explaining the variance if needed.