Stock market regulator, Securities & Exchange Board of India (SEBI) issued Circular No. CIR/CFD/POLICY CELL/7/2014 dated 15th September, 2014 to introduce certain amendments in revised clause 49 of listing agreement, effective from 1st October, 2014.The gist has been produced hereinbelow:-
1) Non- applicability of clause 49 on companies having equity share capital upto INR 10 crores and Net worth upto INR 25 crores, as on the last day of the previous financial year;
2) The provisions regarding appointment of women director shall be effective from 1st Apr’15;
3) Maximum tenure of independent directors shall be in accordance with companies act’13( and clarifications made thereunder) as against the existing tenure of 5 years;
4) A transaction with the related party shall be construed to include
single transaction or a group of transactions in a contract;
5) Definition of related party amended to bring the same at par with the companies act [Section 2(76)] and applicable accounting standards[ AS -18, 21,23,27, etc. ]
6) For materiality concept, limit of 5% has been enhanced to 10%;
7) related party transactions between two govt. companies, or between a holding and its wholly owned subsidiary, don’t require any approval of audit committee. These also not require any approval of shareholders as against special resolution required earlier;
8) Following disclosures stand deleted:
——resignation of directors
——formal letter of appointment
——details of training imparted to Independent Directors
——the remuneration policy and the evaluation criteria in its Annual report
9) Earlier certification was required by MD/Manager and Whole time Finance Director/CFO. Now, the same has been replaced as follows–
CEO or MD or Manager….or in their absence, a Whole time Finance Director…..and the CFO
10) The web link of policy of dealing with related party transactions need to be disclosed in the annual report.
For erstwhile clause 49, please refer following link:http://www.sebi.gov.in/cms/
Does it mean Listed companies having Equity Capital upto Rs.10 crores and net worth of Rs.25 crores are not required to appoint Chief Financial Officer and Company Secretary?