Company secretarial audit?

By | June 9, 2023

 

Company secretarial complianceCompany Secretarial Compliance

Company secretarial compliance audit refers to an independent examination and evaluation of a company’s secretarial and compliance practices by a qualified professional, typically a practicing company secretary. The objective of a secretarial audit is to assess the company’s adherence to legal and regulatory requirements, corporate governance norms, and prescribed secretarial standards.

Here are key points related to company secretarial audit

1.Purpose:

The primary purpose of a secretarial audit is to ensure compliance with applicable laws, regulations, and secretarial standards.

It provides an independent and objective assessment of the Company secretarial compliance practices.

The audit helps identify any deviations, non-compliance, or deficiencies in the company’s secretarial processes and recommend corrective measures.

2. Scope:

The secretarial audit covers various aspects of compliance, corporate governance, and secretarial practices as mandated by laws and regulations.

It includes a review of statutory registers, filings with regulatory authorities, minutes of meetings, board and committee composition, adherence to secretarial standards, and compliance with corporate governance guidelines.

3. Examination Process:

The secretarial audit involves a detailed examination of company records, documents, and processes.

The auditor reviews the company’s compliance with the Companies Act, other applicable laws, and regulatory requirements.

The examination may include a review of board meetings, general meetings, secretarial standards, shareholding patterns, related party transactions, and disclosure practices.

4. Reporting:

The secretarial auditor prepares a Secretarial Audit Report in a prescribed format.

The report includes observations, findings, and recommendations based on the auditor’s examination and assessment.

It highlights areas of non-compliance, potential risks, and suggestions for improving the company’s secretarial and compliance practices.

5. Filing and Disclosures:

The Secretarial Audit Report is filed with the regulatory authorities, such as the Registrar of Companies (RoC), as part of the company’s annual filings.

The report may also be shared with the company’s board of directors, management, and stakeholders to enhance transparency and governance.

6. Legal Compliance and Assurance:

A secretarial audit provides assurance to the management, board, and stakeholders that the Company secretarial compliance practices are in compliance with applicable laws and regulations.

It helps mitigate legal and regulatory risks and ensures adherence to corporate governance norms.

The audit serves as a mechanism for identifying and rectifying any non-compliance or deficiencies in the Company secretarial compliance.

Conducting a secretarial audit on a periodic basis demonstrates the company’s commitment to good corporate governance, legal compliance, and transparency. It assists in identifying areas of improvement, strengthening internal controls, and ensuring adherence to prescribed secretarial standards and regulatory requirements.

 

To visit https://www.mca.gov.in

 

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