MCA Guidelines For Accounting And Auditing Private Limited

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Introduction

Congratulations! You have registered your private limited company, and now it is time to complete the compliance standards to maintain smooth day-to-day operations. Regardless of its size or type, every private limited company must have its books audited by chartered accountants before the end of the fiscal year. The appointment of an auditor is part of the responsibility of assuring compliance. The auditor must examine the company’s records and prepare the audit report and audited financial reports, which must also be submitted to the Registrar of Companies.

The auditing process is a yearly practice that is part of a company’s compliance responsibilities. To guarantee that you comply with MCA legislation, we give you a list of compliance requirements in addition to the auditing process.

Accounting And

Auditor Appointment

Form ADT-1 must be used to appoint an auditor for five years. The first Auditor must be appointed within one month of the company’s establishment.

Statutory Audit Of Accounts

Every corporation is required by law to prepare its accounts and have them examined by a chartered accountant near the conclusion of the fiscal year. The auditor is responsible for preparing the audit report and the assessed financial statements, as well as documenting them with the Registrar.

Annual Return Filing (Form MGT-7)

All private limited businesses are expected to file their annual returns within 60 days of holding the annual general meeting (AGM). Yearly returns are valid from April 1st to March 31st.

Financial Statement Documentation (Form AOC-4)

Within 30 days after holding the AGM, the organization must record its balance sheet, along with the declaration of profit and loss account and the director’s report, in Form AOC-4.

Annual General Meeting Planning

Every private limited company is required to hold an AGM once a year. All organizations are obligated to hold their AGM within six months of the conclusion of the fiscal year.

Organizing the Directors’ Report

Directors’ Reports must include a notification of all data required by Section 134.

ROC Annual Filings

Private limited firms must file annual accounts and returns with the Registrar of Companies, including information on its officers, shareholders, and so on. Such compliances must be completed once a year. The following forms must be documented with the ROC as part of the annual filing:

MGT-7 (Annual Report): 

All private limited corporations are required by law to file their annual returns within 60 days following the annual general meeting. The yearly return will cover the period from April 1st to March 31st.

Form AOC-4 (Financial Statements): 

Within 30 days of the annual general meeting, all private limited firms must report information of the Profit and Loss Account and Director Report in form AOC-4.

Directors’ Report

A Director’s report is a financial document that must be filed before the end of the fiscal year. If applicable, directors must also give information about their positions as directors in other organizations. Furthermore, all additional pertinent information must be provided in hard copy in the form of a detailed director’s report.

Maintenance Of Statutory Registers And Records

A private limited company must maintain several statutory registers and records as required by company law, such as a register of shares, a register of directors, a register of members, and so on. Furthermore, the corporation is obligated to keep merger documents, resolutions of board meetings, minutes of board meetings, and annual general meetings, among other things.

Such records must be retained at the registered office and be accessible to its members during business hours. Also, the organization’s books of account for at least the last eight financial years must be secured and maintained.

Non-Compliance

If a corporation fails to follow the rules and norms outlined in the Companies Act, both the firm and each official who fails to do so will be held accountable. They may be sentenced to a fine and imprisonment. The MCA may levy penalties if there is a delay in any filing.

Companies may find it difficult to complete the auditing process and meet the auditing standards on their own. Many times, a professional touch is required to maintain seamless day-to-day operations. At FINAXIS, we assist your firm in navigating ROC compliances and auditing standards, assuring a seamless auditing procedure.