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Remuneration to executive directors

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Jalpa

Company Secretary & Compliance Officer

36 Points Posted on 31 July 2013

Dear All,

A public limited company wants to pay remuneration to its executive director. Kindly advise on the limits applicable for such payment and the procedure to pay remuneration.. Please note that the company also pays remuneration to its managing director as per part b of schedule xiii..

Replies (4)

Devendra

Chartered Accountant

3769 Points Posted on 01 August 2013

The Company can pay Remuneration to the Executive Director of Co. (having a MD) to the extent of 1% of the Net Profit of the Company.

Jalpa

Company Secretary & Compliance Officer

36 Points Posted on 01 August 2013

What if the MD is been paid as per schedule XIII I.e. The co. Has inadequate profits .. In this case how is the executive director to be paid ??

CA D.C. Bansal

Accounts Head

311 Points Posted on 01 August 2013

As per sec 309 of the Companies Act, If the Director is in full time employment he may be paid a remuneration upto 5% of net profit of the company but this limit should not exceed 10% to all the directors.

ars

265 Points Posted on 01 August 2013

pl. refer to sec. 198,269. you may alos consider sch. XIII and find out under which category your co. fits in and accordingly decide his remuneration through remuneration comm.

You may also pass sp. res. and go to central govt. for salary in excess of above. C.G. will tak its decision on merits.