The Ministry of Corporate Affairs (MCA) has made amendment in various rules under company law pertaining to Audit, Auditors and Accounts.
Changes notified by Ministry will be effective from 1st April.
DISCLOSURE OF SHAREHOLDING OF PROMOTERS
In Financial Statements the Note on Share Capital shall mention the details regarding shareholding of the promoters along with changes, if any during Financial Year.
CURRENT MATURITIES OF LONG TERM BORROWINGS TO BE DISCLOSED SEPARATELY
Current maturities of long term borrowings during financial year are required to be disclosed separately under the head ‘SHORT TERM BORROWINGS’ instead of ‘OTHER CURRENT LIABILITY’.
NOTE ON INTANGIBLE ASSET
Change in amount due to revaluation (if the change is 10% or more in the aggregate of the net carrying value of each class of intangible assets) shall be disclosed additionally.
Company should disclose any Capital-work-in Progress (Capital WIP) ageing schedule and the Capital WIP whose completion is overdue or has exceeded its cost compared to its original plan.
LOANS OR ADVANCES
Loans or advances given by company to promoters, directors, KMPs and the related parties (as per the defined by Companies Act, 2013) either severally or jointly with any other person, that are repayable on demand or without specifying any terms or period of repayment should be disclosed.
DISCLOSURE OF REVALUATION OF PROPERTY, PLANT & EQUIPMENT
If any revaluation of Property, Plant & Equipment is made by the company then company have to disclose as to whether the revaluation is based on the valuation by a registered valuer.
Security Deposit maintained by company shall be reclassified as ‘OTHER NON CURRENT ASSET’ Instead of ‘Long term loans and advances’.
UTILIZATION OF BORROWINGS
If funds were utilized for a purpose other than for which they were borrowed then company shall disclose the reason for utilization of funds and shall also disclose the purpose for which funds were utilised.
DISCLOSURE OF BOOKS OF ACCOUNTS WITH THE QUARTERLY OR MONTHLY RETURNS FILED WITH BANKER
Where the Company has borrowings from banks or financial institutions on the basis of security of current assets, it shall disclose whether quarterly returns or statements of current assets filed by the Company with banks or financial institutions are in agreement with the books of accounts and if not, a summary of reconciliation and reasons of material discrepancies, if any to be properly disclosed.
ROUNDING OFF FIGURES
Companies have to round off the figures appearing in financial statements. Formerly, it was optional. The criteria for rounding off shall be based on ‘Total Income’ instead of ‘Turnover’.
DETAILS OF ALL IMMOVABLE PROPERTY
Immovable property (other than company where company is lessee) whose title deeds are not held in the name of the company in the prescribed format then company have to provide the details of such immovable property. If such immovable property is jointly held with others, details regarding to extent of the company’s share should be given.
DISCLOSURE RELATING TO BENAMI TRANSACTION ACT, 1988
The proceedings have been initiated or pending against the Company for holding any Benami property under the Benami Transactions (Prohibition) Act, 1988shall be disclosed.
If the name of the company is declared as wilful defaulter by any bank or financial institutions or other lenders shall be disclosed.