Introduction: Compliance is a critical aspect of running a private company. The level of compliance varies based on factors such as paid-up capital, turnover, and borrowings. This comprehensive guide outlines the specific compliance requirements for private companies categorized by these criteria. By understanding these obligations, private companies can ensure proper adherence to legal and regulatory norms.
List Of Compliances for Private Companies on The Basis of Paid-Up Capital, Turnover, Borrowings, Etc.
ON THE BASIS OF PAID-UP SHARE CAPITAL
| Amount (in Rs.) |
Compliances | Relevant Section |
Relevant Rules | Constitution/ Notes |
Time Period for Compliances |
| 5 Cr and above |
Filing of Financial Statement through XBRL mode | 137 (2) | The Companies (Filing of Documents and Forms in Extensible Business Reporting Language) Rules, 2015 |
— | Within 30 days of Annual General Meeting |
| 10 Cr and above |
Annual Return Certification (MGT-8) | 92(2) | Rule 11(2) of the Companies (Management and Administration) Rules, 2014 |
To be filed with the annual return, in e- Form MGT-7, of the company | Within 60 days of Annual General Meeting |
| Appointment of Company Secretary | 203(1) | Rule 8A of the Companies (Appointment and Remuneration of Managerial Person- nel) Rules, 2014 |
Appoint within 6 months from the applicability of provisions or such vacancy |
||
| 50 Cr and above |
Rotation of Auditor2 | 139(2) | Rule 5 of the Companies (Audit and Auditors) Rules, 2014 | — | Individual Auditor -One term of five years Auditor’s firm -Two terms of five consecutive years |
1 Non-banking financial company, housing finance company and company engaged in the business of banking and insurance sectors are exempted. (Refer Rule 5 of the Companies (Audit and Auditors) Rules, 2014 for applicability)
ON THE BASIS OF TURNOVER
| Amount (in Rs.) |
Compliances | Relevant Section |
Relevant Rules | Constitution/ Notes |
Time Period for Compliances |
| 50 Cr and above* | Annual Return Certification (MGT-8) | 92(1)(k) | Rule 11(2) of the Companies (Management and Administration) Rules, 2014 |
To be filed with the annual return, in e-Form MGT- 7, of the company | Within 60 days of Annual General Meeting |
| 100 Cr and above | Filing of Financial Statement through XBRL model | 137(2) | The Companies (Filing of Documents and Forms in Extensible Business Reporting Language) Rules, 2015 |
— | Within 30 days of Annual General Meeting |
| 200 Cr and above | Appointment of Internal Auditor2 | 138(1) | Rule 13(1) of the Companies (Accounts) Rules, 2014 |
The internal auditor may or may not be an employee of the company; | Within 6 months form the date of applicability of the Act/Rules |
| 1000 Cr and above | Constitution of Corporate Social Responsibility Committee’ |
135(1) | Rule 3 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 |
A company if have 2 directors on its board then can constitute its CSR committee with 2 such directors | As soon as the provisions of the Act/Rules become applicable |
ON THE BASIS OF LOANS AND BORROWINGS FROM BANKS AND PFIs
| Amount (in Rs.) |
Compliances | Relevant Section |
Relevant Rules | Constitution/ Notes |
Time Period for Compliances |
| 50 Cr and above | Rotation of Auditor4 | 139(2) | Rule 5 of the Companies (Audit and Auditors) Rules, 2014 | — | Individual Auditor -One term of five years, while for Auditor’s firm -Two terms of five consecutive years |
1 Non-banking financial company, housing finance company and company engaged in the business of banking and insurance sectors are exempted Refer Rule 5 of the Companies (Audit and Auditors) Rules, 2014 for applicability
| Amount (in Rs.) |
Compliances | Relevant Section |
Relevant Rules | Constitution/ Notes |
Time Period for Compliances |
| Exceeding 50 Cr | Establishment of Vigil Mechanism’ | 177(9) | Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 | — | As soon as the provisions of the Act/ Rules become applicable |
| 100 Cr and above | Appointment of Secretarial Auditor and Secretarial Audit2 | 204(1) | Rule 9 of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 |
To be enclosed with board report | Before the
signing of board report |
| Exceeding 100 Cr or more | Appointment of Internal Auditor3 | 138(1) | Rule 13(1) of the Companies (Accounts) Rules, 2014 |
The internal auditor may or may not be an employee of the company; | Within 6 months form the date of applicability of the Act/Rules |
ON THE BASIS OF OUTSTANDING DEPOSITS
| Amount (in Rs.) |
Compliances | Relevant Section |
Relevant Rules | Constitution/ Notes |
Time Period for Compliances |
| Accepts Deposits | Establishment of Vigil Mechanism | 177(9) | Rule 7 of the Companies (Meetings of Board and its Powers) Rules, 2014 | — | As soon as the provisions of the Act /Rules become applicable |
| 50 Cr and above | Rotation of Auditors | 139(2) | Rule 5 of the Companies (Audit and Auditors) Rules, 2014 | — | Individual Auditor -One term of five years, while for Auditor’s firm -Two terms of five consecutive years |
ON THE BASIS OF NET PROFIT
| Amount (in Rs.) |
Compliances | Relevant Section |
Relevant Rules | Constitution/ Notes |
Time Period for Compliances |
| 5 Cr and above | Constitution of Corporate Social Responsibility Committee’ | 135(1) | Rule 3 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 |
A company if have 2 directors on its board then can constitute its CSR committee with 2 such directors | As soon as the provisions of the Act/ Rules become applicable |
ON THE BASIS OF NET WORTH
| Amount (in Rs.) |
Compliances | Relevant Section |
Relevant Rules | Constitution/ Notes |
Time Period for Compliances |
| 250 Cr and above | Comply with Indian Accounting Standard | 133 | Rule 4 of the Companies (Indian Accounting Standards) Rules, 2015 | Applicability: — (a) Companies whose equity or debt securities are listed/are in the process of listing on any stock exchange (other than SME Exchange) in India/abroad and having net worth of less than rupees five hundred crore, Or;
(b)Unlisted companies having net (c) Holding, subsidiary, joint venture or associate companies of companies as per clause (a) or (b) above. |
As soon as the provisions of the Act/ Rules become
applicable |
| 500 Cr and above |
Constitution of Corporate Social Responsibility Committee’ |
135(1) | Rule 3 of the Companies (Corporate Social Responsibility Policy) Rules, 2014 |
A company if
have 2 directors on its board then can constitute its CSR committee with 2 such |
As soon as the provisions of the Act/Rules become applicable |
*Note that cost record and appointment of cost auditor is also required on the basis of turnover and services, therefore, please refer section 148 of the Act read with rule 4 of the Companies (Cost Records and Audit) Rules, 2014 and rule 14 of the Companies (Audit and Auditors) Rules, 2014. (i) Not applicable on Specified IFSC private company for a period of 5 years from the commencement of business (Notification No. GSR 8(E) dated 04.01.2017} (ii) Refer section 135(1) of the Act for applicability
Author Bio
