BOARD OF DIRECTORS REPORT UNDER CO. ACT 2013

BRIEF ABOUT BOARD OF DIRECTORS REPORT UNDER COMPANIES ACT 2013

Section 134 of the Companies Act, 2013 casts a responsibility on the Board of Directors to prepare a report containing details as discussed below and this report needs to be annexed to the Financial Statements which are laid before the members in the annual general meeting.

Companies Act, 2013 also contains provisions regarding revision of Board’s report which has been discussed in Chapter VI of the companies act, 2013 along with revisions of Financial Statements under Section 131.

1. Annual Disclosures:-

All Companies:-

S. No.	Contents of The Report	Reference  to Act/Rule
1.	Financial  Summary/Highlights, Operations, State of Affairs:-	Section 134Rule 8(5)(i) of Cos(Accounts) Rules, 2014
2.	Events Subsequent to the date of Financial statements.	Section 134(3) (l)
3.	Change in the Nature of Business , if any.	Rule 8(ii) of Cos (Accounts) Rules, 2014
4.	Dividend, if declared & amount, if any, carried forwarded to Reserves.	Section 134 (3) (k)& (j)
5.	No of Board Meetings held during.	Section 134 (3)(b)
6.	Directors and Key Managerial Personnel.	Rule 5 (iii) of Cos. (Accounts) Rules, 2014
7.	Director’s Responsibility Statement.	Section 134 (3) (c) & 134 (5)
8.	Information about the Financial Performance / Financial Position of the Subsidiaries / Associates/ JV.	Rule 8(1) of Cos(Accounts) Rules, 2014Rule 8(5) of Cos (Accounts) Rules, 2014
9.	Extract of Annual Return.	Section 134(3) (a)
10.	Auditors:-·         Qualification in Auditors reports.	Sections 134 139, 140Rules 3,5,6 of Cos. (Audit &Auditors) Rules, 2014
11.	Conservation of Energy, Technology Absorption And Foreign Exchange Outgo.	Section 134 (3) (m)Rule 8 of Cos(Accounts) Rules, 2014
12.	Significant & Material orders Passed by the Regulators if any.	Rule 8 (5) (vii) Cos (Accounts) Rules, 2014
13.	Details of Adequacy of Internal Financial Controls, if applicable.	Rule 8(5) (viii) Cos( Accounts) Rules, 2014
14.	Particulars of Loans, Guarantees or Investments.	Section 134(3) (g)
15.	Risk Management Policy.	Section 134(3) (n)
16.	Corporate Social Responsibility Policy:-·         Reason for not spending.	Section 134(3) (o)Rule 8 of Cos. (CSR Policy) Rules,2014
17.	Related Party Transactions:-·         Justification for Entering into Related Party Transactions.	Section 134(3) (h) &Rule 8(2) of Cos. (Accounts) Rules,2014Section 188(2)
18.	Secretarial Standards.	SS 10

1. Listed and certain Public Companies:-

Along with above said applicability, Listed Companies shall further include following contents in Board’s Report

Sl No.	Contents Of The Report	Reference  to Act/Rule
19.	Declaration from Independent Directors on Annual basisANNEXURE IV	Section 134(3) (d)
20.	Composition of Audit Committee:-·         Reasons for not accepting the recommendations of the Audit Committee. Policy laid down by the Nomination and Remuneration Committee for Remuneration of Directors, KMP &other employees and the Criteria formulated by the Committee for determining Qualifications, Positive attributes, Independence of a Director.	Section 177(8)Proviso to Section 178 (4)& Section 134
21.	Vigil Mechanism	Proviso to Section 177(10)
22.	Director’s Responsibility Statement:-·         Directors had laid down internal financial controls to be followed by the company and that such internal financial controls are adequate and were operating effectively. Directors had devised proper systems to ensure compliance with the provisions of all applicable laws and that such systems were adequate and operating effectively.	Section 134 (3) (c) & 134 (5)
23.	Secretarial Audit:-·         Qualifications in Audit Reports, (by the company secretary in practice in his secretarial audit report).	Section 204(3)
24.	Formal Annual Evaluation	Section 134(3) (p)
25.	Disclosures of Ratio of remuneration to each director ( Only Listed Company)	Section 197(12)Rule 5 (1) (2) & (3) of Cos (Appointment & Remuneration) Rules, 2014
26.	Confirms that the Company paid the listing fee for FY 2015-16 to Stock Exchanges where the Company Shares are listed. (Only Listed Company)	–
27.	Corporate Governance and Shareholders Information A report on Corporate Governance as laid down in Clause 49 of the Listing Agreement	–

NBFC, Housing Companies… etc:-

Sl No.	Contents Of The Report	Reference  to Act/Rule
28.	Industry based disclosures as mandated by  the respective Laws governing the Company	–

1. Companies Accepting Deposits:-

Sl No.	Contents Of The Report	Reference  to Act/Rule
29.	Details relating to Deposits, covering the following :

·         Accepted during the year;

·         Remained unpaid or unclaimed as at the end of the year;

·         Whether there has been any default in repayment of deposits or payment of interest thereon during the year and if so, number of such cases and the total amount involved.
(i) At the beginning of the year
(ii) Maximum during the year
(iii) At the end of the year.

·         Details of deposits which are not in compliance with the requirements of Chapter V of the ActSection 73, 74 & 76

Rule 8(5)(v) of Cos( Accounts) Rules, 2014

1. Event-Based Disclosures:-

All Companies:-

Sl No.	Contents Of The Report	Reference  to Act/Rule
1.	Issue of Sweat Equity Share	–
2.	Issue of Shares with Differential Rights	–
3.	Issue of Shares under Employees Stock Option Scheme	–
4.	Disclosure on Purchase by Company or giving of Loans by it for purchase of its shares	Section 67 (3)
5.	About Buy Back Shares	–
6.	Disclosure About Revision	Yet to be Notified

Who shall Sign the Report:-

Section -134 (6) states that the Board’s report and any annexures thereto under sub-section (3) shall be signed by its chairperson of the company if he is authorized by the Board and where he is not so authorized, shall be signed by at least two directors, one of whom shall be a managing director, or by the director where there is one director.

Board’s Report shall be approved by the Board of Directors before they are signed on behalf of the Board at least by the chairperson of the company where he is authorized by the Board or by two directors out of which one shall be managing director and the Chief Executive Officer, if he is a director in the company, the Chief Financial Officer and the company secretary of the company, wherever they are appointed.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances; Hope the information will assist you in your Professional endeavors. For query or help, contact: singh@carajput.com or call at 9555555480

More updates for related blogs are:

• CORPORATE AND PROFESSIONAL UPDATES May 23, 2017

• CORPORATE AND PROFESSIONAL UPDATES March 15 ,2017