LEGAL PROVISION

SEBI inserted a new regulation i.e. Regulation 24A and made effective for the financial year ended March 31, 2019 in the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (SEBI (LODR) Regulations) which mandated the requirements of annexing a Secretarial Audit report in a specified format for the listed entity and all its material unlisted subsidiaries.

Further, all listed companies in addition to Secretarial Audit Report, required to submit Annual Secretarial Compliance Report to the stock exchanges within 60 days of closure of financial year in such form as may be prescribed with effect from the year ended March 31, 2019 i.e. on or before 30th May every year.

Annual Secretarial Compliance Report (“ASCR”) restricts itself to only SEBI Act and its regulations, circulars issued thereunder.

Important Point: (“ASCR”) unlike Secretarial Audit is applicable only to Listed Entities (Not applicable to Material Unlisted Subsidiary)

FORMAT

For Format for annual secretarial audit report and annual secretarial compliance report click the below mentioned link

SEBI notifies Format for annual secretarial audit report & compliance report

NON-APPLICABILITY

In terms of Regulation 15 of SEBI(LODR) Regulations, following listed entities are not required to submit Annual Secretarial Compliance Report

Listed entity having paid up equity share capital not exceeding rupees ten crore and net worth not exceeding rupees twenty five crore, as on the last day of the previous financial year:

Provided that where the provisions of regulations 24A become applicable to a listed entity at a later date, it shall ensure compliance with the same within six months from such date]

[Provided further that once the above regulations become applicable to a listed entity, they shall continue to remain applicable till such time the equity share capital or the net-worth of such entity reduces and remains below the specified threshold for a period of three consecutive financial years.]

Checklist Annual Secretarial Compliance Report 2022

Listed entity which has listed its specified securities on the SME Exchange:

[Provided that for other listed entities which are not companies, but body corporate or are subject to regulations under other statues, the provisions of corporate governance provisions as specified in regulation [24A] shall apply to the extent that it does not violate their respective statutes and guidelines or directives issued by the relevant authorities.]

INFORMATION REQUIRED FOR ISSUING ANNUAL SECRETARIAL COMPLIANCE REPORT:-

  • Copies of all notices/letters received from Stock Exchange and replied filed by the Company in this regard.
  • Copies of all communications / compliances done by the company with the Stock exchanges.
  • Inspection of website of Stock Exchange to review public announcements and filing done at stock exchange by the company during financial year under review.
  • Identify actions taken against the Company by the Stock exchange under the Standard operating procedures (SOP).
  • Meeting with the management for clarifications on pending points, if any.
  • Review of Board & Committee Meeting Minutes.
  • Review of event based filings (viz. Postal ballot, Change in management/Board, Dividend, Shifting, Change of name/Objects, Amalgamation, fresh acquisition, sale of assets/ investments etc. and compliances.
  • Review of Action taken on last year observations made by the Practicing CS in last Annual Secretarial Compliance Report.
  • Review of all Statutory records maintained by the Company.
  • Management Representation letter on status of compliance.
  • Check out applicability and compliance of specific provisions in case of Top 500 /100 Companies by market capitalization.
  • Qualify report wherever required. In case irregularity is found short of qualification, Disclose in the report wherever required.

DISCLAIMER: This Article is designed to provide information of a general nature and is not intended as a substitute for professional consultation and advice in a particular matter. The opinions and interpretations expressed within are those of the author only and may not reflect those of other identified parties. The results & interpretation have been done on the basis of our understanding of the Act & Rules, where applicable. We explicitly disclaim any financial or other liability of any kind arising on account of any action taken pursuant to the results or interpretation of this Article.

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