A Board report is a document produced by the board of directors under the requirements of The Companies Act, 2013, which details the state of the company and its compliance with a set of financial, accounting and corporate social responsibility standards.

The requirement for directors’ reports arose out of a general move for greater transparency in corporate governance. It is useful for shareholders to find out issues such as whether the company has good finances, whether the market has potential, and whether the business has the structural capacity to expand into new opportunities. In order for shareholders to make informed decisions when casting their votes at annual or other meetings, the Directors’ Report provides part of that essential minimum standard of information.

What is Board report?

There is no definition given in any of Indian Law which defines a Board Report. However, a Board report is a report prepared by Board of company in which they states all the working and major accomplishment of company both in qualitative as well as quantitative terms.

Board Report

What are provisions/ regulations that governs a Board report?

The Board report  provisions are governed under the Companies Act, 2013 read with The Companies (Accounts) Rules, 2014 including any amendments/ alteration for time being in force.

Is it mandatory to prepare Board Report?

Yes, it is mandatory to prepare a Board Report as per section 134 of the Companies Act, 2013. A Board Report is prepared for every financial year along with financial results of the company and should be placed in every Annual General Meeting.

Which are companies are required to prepare a Board Report?

Every Company needs to prepare a Board report for each Financial Year like:-

  • Private Company
  • Public Company
  • Listed Company
  • Section 8 Company, etc.

One person Company need not to prepare a Board report, they will attach a report containing explanations or comments by the Board on every qualification, reservation or adverse remark or disclaimer made by the auditor in his report.

When a Board report is prepared?

A Board report is typically prepared after a financial year end, though material changes are also taken in Board Report.

Who prepares a Board report?

A Board report is generally prepared by Company secretary of the company but if a company is not required to appoint a company secretary any authorized person who has good knowledge of Law can prepare it.

What are contents covered in Board Report?

As per section 134 of The companies Act, 2013, there are many points which are governed in Board report. As the matter is too lengthy, I will prepare a separate article for matters to be included in Board report thoroughly.

Is it mandatory to place it in Annual General Meeting?

Yes, very much. A per the Companies Act, 2013, it is mandatory for every company to place it in Every Annual General Meeting.

Who signs a Board Report?

 The Board’s report and any annexures shall be signed by its chairperson of the company if he is authorised by the Board and where he is not so authorised, shall be signed by at least two directors, one of whom shall be a managing director, or by the director where there is one director.

What if a company fails to prepare it or what are penalty provision for non-compliance in preparation of Board Report?

If a company contravenes to prepare a Board report, the company shall be punishable with fine which shall not be less than fifty thousand rupees but which may extend to twenty-five lakh rupees and every officer of the company who is in default shall be punishable with imprisonment for a term which may extend to three years or with fine which shall not be less than fifty thousand rupees but which may extend to five lakh rupees, or with both.

Disclaimer: – The above article is prepared keeping in mind all the important and basic question as well as provision of section 134 of the Companies Act, 2013 which comes in mind of a professional or other stakeholder while preparing Board report.  The contents of this article are for information purposes only and does not constitute an advice or a legal opinion and are personal views of the author. It is based upon relevant law and/or facts available at that point of time and prepared with due accuracy & reliability. Readers are requested to check and refer relevant provisions of statute, latest judicial pronouncements, circulars, clarifications etc before acting on the basis of the above write up.  The possibility of other views on the subject matter cannot be ruled out. By the use of the said information, you agree that Author / TaxGuru is not responsible or liable in any manner for the authenticity, accuracy, completeness, errors or any kind of omissions in this piece of information for any action taken thereof. This is not any kind of advertisement or solicitation of work by a professional.

(The Author is Corporate Consultant and provides varied array of services including Start-ups mentor, Secretarial, Legal, Trademark, taxation, Audit, GST, Book keeping and other ancillary advisory service in Delhi, Chandigarh as well as The National Capital Region (NCR) and can be contacted through email id:- triptishakyacs2017@gmail.com and Contact Number: 91-8178515005)

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Qualification: CS
Company: Proventure- Aiding your Business
Location: NEW DELHI, New Delhi, IN
Member Since: 06 Jul 2019 | Total Posts: 39
I am Company Secretary and engaged with this profession from last nine (9) years. Throughout this journey, my moto is to help people start their startups and business. View Full Profile

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