Ministry of Corporate Affairs has issued another clarification with respect to Circulation and filing of Financial Statements on 21st July 2015 based on the clarifications sought by stakeholders.
Clarification sought by Stakeholders
- Whether provisions of Section 136 would also allow circulation of financial statements at a shorter notice, if conditions given under Section 101 are fulfilled?
- Whether a company can place/ file unaudited accounts of a foreign subsidiary, if the audit of such foreign subsidiary is not mandatory as per its law of land and such audit has not been conducted?
- Subsidiary would need to be presented as per the format under Schedule III of the 2013 Act/ Indian Accounting Standards?
Clarification provided by MCA
- A Company holding a general meeting after giving a shorter notice may also circulate financial statements at such shorter notice;
- In case of a foreign subsidiary, which is not required to get its accounts audited as per the local law, the Indian parent company may place/ file such unaudited accounts to comply with requirements of Section 136(1) and 137(1). However, these financial statements need to be translated in English, if the original accounts are not in English;
- Further, the format of these accounts should be, as far as possible, in accordance with the requirements under the 2013 Act. In case this is not possible, a statement indicating the reasons for deviation may be placed/ filed along with such accounts.