CA Pratik Anand
Approval of Financial statements of a Company for FY 2013-14 – Have You filed form MGT-14?
We are all in the process of finalising the accounts of Companies for the Financial Year 2013-14 or have already finalised such financial statements. But, do we know that the resolution with respect to approval of financial statements by the Board for the FY 2013-14 is to be filed with the Registrar of Companies.
As per the provisions of Companies Act’2013, the financial statements of a company alongwith the Directors’ report are to be approved by the Board of Directors of the company at a meeting of the Board of Directors.
Let us take a look at the resolutions to be filed with the Registrar:
As per clause (g) of Section 117 (3) of the Companies Act’2013 the following resolutions are to be filed with the Registrar:
♠ resolutions passed in pursuance of sub-section (3) of section 179
Now let us look at the provisions of sub-section (3) of section 179:
Section 179(3):
The Board of Directors of a company shall exercise the following powers on behalf of the company by means of resolutions passed at meetings of the Board, namely:—
(a) to make calls on shareholders in respect of money unpaid on their shares;
(b) to authorise buy-back of securities under section 68;
(c) to issue securities, including debentures, whether in or outside India;
(d) to borrow monies;
(e) to invest the funds of the company;
(f) to grant loans or give guarantee or provide security in respect of loans;
(g) to approve financial statement and the Board’s report;
(h) to diversify the business of the company;
(i) to approve amalgamation, merger or reconstruction;
(j) to take over a company or acquire a controlling or substantial stake in another company;
(k) any other matter which may be prescribed:
From the simultaneous reading of the above Sections 117 and Section 179 (3) of the Companies Act’2013, it is clear that unlike the previous years, the resolution with respect to approval of financial statements and the Board’s report for the FY 2013-14 onwards has to be separately filed with the Registrar of Companies.
Form MGT-14 has been prescribed for filing resolutions listed under section 117 of the Companies Act’2013.
Q. What is the last date for filing the form MGT-14?
Ans: As per the provisions of Section 117 of the Companies Act’2013, every resolution listed under sub-section (3), has to be filed with the Registrar within thirty days of passing of such resolution.
Therefore, in order to avoid late fee under the provisions of the Companies Act’2013, the resolution approving the financial statements and the Board’s Report has to be filed within 30 days of such approval.
Now let us examine the latest date upto which the financial statements can be approved and Form MGT-14 could be filed.
As per the provisions of Section 96 of the Companies Act’2013, every company other than a one-person company shall hold in each year a general meeting as its Annual General Meeting within a period of six months, from the closing of the financial year.
Since, the accounting year of most of the companies is the financial year i.e period beginning from 1st day of April of the preceding year and ending with the 31st day of March of the subsequent year. 1stApril’2013 to 31st March’2014 in our case, therefore
The Annual General Meeting can be held latest by 30th September’2014.
Section 101:
As per the provisions of Section 101 of the Companies Act’2013,
(1) A general meeting of a company may be called by giving not less than clear
Twenty one days’ notice either in writing or through electronic mode in such manner as may be prescribed:
Therefore, the notice of the meeting should reach the members latest by the 8th of September’2014.
Since, the facility of internet is not available in everywhere in India, therefore we consider notice in writing to be sent by registered post. In that case we consider three clear days as the time lag between the posting of notices and the receipt of the notices by the members. Therefore the notices need to be posted by the 4th of September’2014 for the AGM of FY 2013-14.
Since the notices are to be posted by the 4th of September’2014, therefore the Board meeting approving the financial statements alongwith the Board’s Report and setting the Agenda for the AGM for FY 2013-14 should have taken place latest by the 3rd of September’2014.
So, If 3rd of September’2014 is taken as the date of Board meeting for approval of the financial statements then MGT-14 has to be filed latest by 2nd of October’2014 in order to avoid late fee under section 403 of the Companies Act’2013.
Notes:
- In this situation, we have considered clear twenty days notice for the AGM. The AGM can be called at a shorter notice if consent is given in writing or by electronic mode by not less than ninety-five per cent of the members entitled to vote at such meeting. The situation may alter in that case.
- The notice of the meeting can also be called by electronic mode i.e E-mail, the notice in that case will be received on the day of mailing itself and the same can be done by the 7th or 8th of September’2014 and the meeting could be held on the seventh of September’2014 and MGT-14 can be filed latest by 6th October’2014.
The views expressed in this article are personal. Hope you find the above information relevant and useful in your daily practice
(The author is a CA in practice at Delhi and can be contacted at: E-mail: [email protected], Mobile: +91-9953199493)
Author Bio
Thanks sir for providing the information. sir i want to know the latest changes in MCA
Dear sir,
Is it mandatory to file MGT 14 Form to the registrar for private companies?If yes what the time limit and what the procedure?
Dear Friends,
If MGT-14 which is required to be filed for resolution, is not filed by Private Company, how would MCA analyze that particular resolution is not filed by Private Company in MGT-14.
Thanks & Regards
Niranjan
Dear Friends,
With respect to filing resolution in MGT-14 by private companies, what will happen if any of the resolution which is required to be filed, is not filed by Private Company.
How MCA will analyze that particular resolution is not filed by any Private Company in MGT-14?
Thanks & Regards
Niranjan
Thank you sir..
a very commendable effort Pratik ji….
my question is ,is it possible to avoid late fee for filing mgt14 by holding agm at shorter notice and sending the notice by 15 sept?
Mr.Sankar,
In Link which u hv provided, it say no need to file MGT 14 for taking noting of audited financial by board (as correctly explained in point 5)
But for approving /adoption of financial & board report, we need to file MGT 14 ( plz refer point 3 in link)
Approving financial statement (u/s 134) & noting of audited financial, both are different.
Company follows F.Y. from jan to dec . for filing the tax audit report company approved the financial statement whether MGT-14 is require to be file.
Please provide me
Dear Sir
As per your article AGM called on shorter notice, however as per Section 136 of the company i.e. a copy of the financial statements, including consolidated financial statements, if any, auditor’s report and every other document required by law to be annexed or attached to the financial statements, which are to be laid before a company in its general meeting, shall be sent to every member of the not less than twenty-one days before the date of the meeting
Hence practically there can not be shorter notice to AGM and you need to send financial statements not less than twenty-one days before the date of the meeting
Mr. Pratik, thanks for sharing useful article.
As per my view we have to hold two Board meetings. In First Board Meeting , Board will approve the Financial statements and after getting the report of Auditor’s on said Financial Statements we will hold next Board meeting for approving the Director’s Report. So , in this case we have to file two e-Form MGT-14 for two separate resolutions.
I think practically it is not possible to approve the financial statements and Board’s Report in one Board meeting.
Please clarify my point of view .
Thanks for sharing this useful article .
As per my view we have to hold two Board meetings. In First Board Meeting , Board will approve the Financial statements and after getting the report of Auditor’s on said Financial Statements we will hold next Board meeting for approving the Director’s Report. So , in this case we have to file two e-Form MGT-14 for two separate resolutions.
I think practically it is not possible to approve the financial statements and Board’s Report in one Board meeting.
Please clarify my point of view .
Hi all CA 2013 s retrospectively applied as the same is with respect to FY of 2014-15?
Dear Rohanji,
The last date for the first board meeting will be 29/07/2014 and not 29/08/2014.The last date of filing the MGT-14 for first board meeting will be 29/08/2014.
The resolution for the approval of accounts can be passed in the first meeting itself provided that the accounts are ready to be finalised. Preferably it will be done in the second meeting.
In case of small co.,one meeting can be held in every six months of the calender year, therefore in case of small company, the accounts can very well be finalized in the first meeting itself.
Dear Sarkarji,
MGT-14 is required to be filed for resolution approving financial statements.
It is mandatory as per sec 117 and section 179.
Dear sir, U said 2nd October as the last date for filing MGT-14. 2nd being a public holidy on a/c of Gandhiji’s birth day(also a sunday), can 3rd the next working day be considered as last date?
Is it possible to file board resolution for Auditor appointment and board resolution for MGT14 all together??
What if, if I have filed my Itr on 18th of august, 2014. I missed the last date of filin mgt-14?
Dear Sir,
As per your Article the last date for filling MGT 14 without late fee under section 403 is 2nd October.
Whereas the difference between two board meetings cannot exceed 120 Days; so practically the last date for first board meeting of the year should be 29/08/2014 and this resolution for approving the Fin Stats and Board will have to be done in the second board meeting.
In any case the first board meeting should be held before 29/08/2014
Kindly correct me in case i m wrong
Good article Pratik.. timely and helpful. Do post such useful tips from time to time. great work!
Plz tell me appropriate date for signing of Director and Signing of Auditor on the financial statements for the financial year 2013-14. my doubt cause of filling of Board resolution for approval of financial statements, as per my view signing of Director on the financial statements is date of approval by Board in that case date of signing of director and date of signing of auditor is different.
Read.
Nice Article with practical approach.
https://taxguru.in/company-law/resolutions-passed-reduce-filing-fees-mgt14.html
As per the above link MGT 14, need not be filed Please clarify
Thanks Anand Ji for providing valuable information.