the company i'm doing an audit for is a close-ended public limited company. Do the rules of 11% celing on net profits prior to remuneration apply to the directors of such a company as well??
BHAGYESH RAVANGE
(C.A Job)
(1528 Points)
Replied 20 August 2009
What is the maximum remuneration which can be paid to all the Directors? The maximum remuneration which can be paid to all the directors of the Company is
11% of the net profits of the Company.
What is the maximum remuneration which can be paid to all the non-whole time Directors? If the company has Managing Director or whole time director or a manager: - 1% of Net Profits If the company has no Managing Director or whole time director or a manager: - 3% of Net Profits Approvals Required -In order to pay remuneration by way of commission, a special resolution is required to be passed. -In order to pay such remuneration by way of a monthly, quarterly or annual payment the Company is required to obtain the approval of Central Government. -In order to pay the remuneration in excess of 1% or 3% (as mentioned above) to its directors: • A separate approval of the Central Government is required for paying such higher remuneration. • Such higher remuneration is authorised by the Company in its General Meeting. See file attach
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