The Board of directors of every listed companies and the following classes of companies, as prescribed under Rule 6 of Companies (Meetings of Board and its powers) Rules,2014 shall constitute an Audit Committee.
(i) all public companies with a paid up capital of Rs.10 Crores or more;
ii) all public companies having turnover of Rs.100 Crores or more;
iii) all public companies, having in aggregate, outstanding loans or borrowings or debentures or deposits exceeding Rs.50 Crores or more.
The paid up share capital or turnover or outstanding loans, or borrowings or debentures or deposits, as the case may be, as existing on the date of last audited Financial Statements shall be taken into account for the purposes of this rule.
|Audit Committee As per Listing Agreement CLAUSE 49||Section 177 of the Companies Act,2013 and Rule 6 and 7 of Companies (Meetings of Board and its Powers) Rules,2014 deals with the Audit Committee|
No of Director.
|The Audit Committee shall have minimum three director as members. Two third of the membersof the audit Committee shall be independent. All the members of audit committee should have ability to read and understand the financial statement and at least one member shall have accounting or related financial management expertise.||The Audit Committee shall consist of Minimum of three director with independent director forming majority Provided that majority of member of Audit Committee including the Chairperson shall be person with ability to read and understand the financial statement|
|Chairman||1. The chairman of audit committee shall be independent director.||No Such Provision.|
|Attendance of Chairman of Audit Committee in AGM||The Chairman of the Audit Committee shall be present at the Annual General Meeting to answer Shareholder queries||The chairman does not require to attend AGM.|
|Meeting of Audit Committee||The audit committee should meet at least four times in a year and not more than four months shall elapse between two meetings. The quorum shall be either two members or one third of the members of the audit committee whichever is greater, but there should be a minimum of two independent members present.||No Provision regarding meeting
But Section 177(7) says the auditor and KMP shall have right to heard in the meeting of the Audit meeting when its considers the auditor s repost but shall not have right to vote.
|Powers of Audit Committee||The audit committee shall have powers, which should include the following:
1. To investigate any activity within its terms of reference.
2. To seek information from any employee. 3. To obtain outside legal or other professional advice.
4. To secure attendance of outsiders with relevant expertise, if it considers necessary.
|The Audit Committee Shall have authority :-
1.To call for the comments of the auditors about internal control systems, the scope of audit, including the observations of the auditors and review of financial statement before their submission to the Board
2. To discuss any related issues with the internal and statutory auditors and the management of the company.
3. To investigate into any matter in relation to the items or referred to it by the Board
4 To obtain professional advice from external sources
5. To have full access to information contained in the records of the company
|Review of information by Audit Committee||The Audit Committee shall mandatorily review the following information:
1. Management discussion and analysis of financial condition and results of operations;
2. Statement of significant related party transactions (as defined by the audit committee), submitted by management;
3. Management letters / letters of internal control weaknesses issued by the statutory auditors;
4. Internal audit reports relating to internal control weaknesses; and 5. The appointment, removal and terms of remuneration of the Chief internal auditor shall be subject to review by the Audit Committee
NO SUCH PROVISION.
Disclaimer: The entire contents of this document have been prepared on the basis of relevant provisions and as per the information existing at the time of the preparation. Although care has been taken to ensure the accuracy, completeness and reliability of the information provided, I assume no responsibility therefore. Users of this information are expected to refer to the relevant existing provisions of applicable Laws. The user of the information agrees that the information is not a professional advice and is subject to change without notice. I assume no responsibility for the consequences of use of such information. IN NO EVENT SHALL I SHALL BE LIABLE FOR ANY DIRECT, INDIRECT, SPECIAL OR INCIDENTAL DAMAGE RESULTING FROM, ARISING OUT OF OR IN CONNECTION WITH THE USE OF THE INFORMATION. This is only a knowledge sharing initiative and author do not intend to solicit any business or profession.
Author – CS Lily Bali ,ACS is a Company Secretary from Delhi/NCR and can be contacted at firstname.lastname@example.org, Contact Number : 9711772751