Compliance with regulatory guidelines and statutory provisions is a crucial part of any company’s operations. For companies registered in India, one of these mandatory obligations includes the annual filing of accounts and returns as per the Companies Act, 2013. This comprehensive guide will provide an in-depth understanding of these annual filing requirements, the various financial statements involved, the purposes they serve, and the critical deadlines for FY 2022-23.
Annual Filing Obligations: Every company in India must adhere to the Companies Act, 2013, which mandates the filing of annual accounts and annual returns within specific timelines.
Annual Accounts Filing: Companies need to submit their annual accounts with the Registrar of Companies (ROC) within 30 days from the conclusion of the Annual General Meeting (AGM). The filing is governed by Sections 129(3) and 137 of the Companies Act, 2013, along with Rule 12 of the Company (Accounts) Rules, 2014.
Annual Return Filing: The annual return, a crucial document providing vital company information, must be filed within 60 days from the conclusion of the AGM. It falls under Section 92 of the Companies Act, 2013, read with Rule 11 of the Companies (Management and Administration) Rules, 2014.
Financial Statements: Companies are required to prepare and present five types of financial statements, namely:
- Balance Sheet: It presents the company’s financial position, showcasing assets, liabilities, and shareholders’ equity.
- Income Statement: This reveals the company’s performance over the financial year, providing details on revenue, expenses, and profits or losses.
- Cash Flow Statement: It tracks the flow of cash and cash equivalents in and out of the company, categorized into operating, investing, and financing activities.
- Statement of Changes in Capital: This provides information about the company’s share capital and the changes during the financial year.
- Notes to Financial Statements: These notes offer detailed explanations of the company’s financial data, assumptions, and policies.
Objectives of Financial Statements and Annual Return: The main purpose of these financial statements and the annual return are to offer useful information to the company’s management for planning, controlling, analyzing, and decision-making. The annual return is an essential document comprising significant details about the company, such as its financial health and changes in management or ownership during the year.
Signatories for Annual Return: The signatories for the annual return vary depending on the type of company. For OPC, Small Companies, and Start-up Private Companies, it should be signed by the Company Secretary (if available) or by the Director. For other companies, both a Director and the Company Secretary should sign it, or in the absence of a Company Secretary, a practicing company secretary should sign it.
Approval of Financial Statements: The financial statements, including any consolidated financial statement, must be approved by the Board of Directors before they are signed on behalf of the Board. The signatories may include the chairperson authorized by the Board, or two directors (one of them being the managing director, if applicable), along with the CEO, CFO, and the Company Secretary (where appointed). For a One Person Company, only one director signs it.
Due Dates for Annual Filing (FY 2022-23):
i. Form DIR-3 KYC: To be filed by every individual allotted DIN before the end of the financial year and whose DIN status is ‘Approved.’ The due date for FY 2022-23 is 30th September 2023.
ii. Form ADT-1 (Appointment of Auditor): To be filed within 15 days from the conclusion of the AGM (for FY 2022-23, it’s 15th October 2023).
iii. Form AOC-4 and Form AOC-4 CFS (in case of consolidated financial statements): To be filed within 30 days from the conclusion of the AGM. For OPC, it’s within 180 days from the close of the financial year. For FY 2022-23, it’s 27th September 2023 for OPC and 29th October 2023 for other companies.
iv. Form MGT-7 and Form MGT-7A (Filing of Annual Return): To be filed within 60 days from the conclusion of the AGM or by 28th November 2023 for FY 2022-23, whichever is earlier. For OPC, the deadline for FY 2022-23 is 28th November 2023.
Certification of Annual Return: Companies falling under specific criteria must have their Annual Return certified by Practicing Company Secretaries (PCS) in Form MGT-8. These criteria include Listed Companies, Companies with Paid-Up share capital of ₹10 Crores or more, and Companies with a turnover of ₹50 Crores or more.
Conclusion: Strict adherence to the regulations specified in the Companies Act, 2013 is not just a legal obligation but also vital for company transparency and integrity. By fulfilling the annual filing requirements and financial reporting obligations, companies can ensure their continued compliance and contribute to a robust corporate governance framework.