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Secretarial Audit (Section 204, Companies Act, 2013)

Who Needs This?

Secretarial Audit is mandatory for:

  • Listed Companies.

  • Public Companies with:

    • Paid-up share capital ≥ ₹50 crore, OR

    • Turnover ≥ ₹250 crore.

  • Voluntarily applicable to other companies for better governance.

Why It Matters

Secretarial Audit ensures:

  • Compliance with the Companies Act, SEBI Regulations, FEMA, Depositories Act, and other corporate laws.

  • Proper maintenance of registers, filings, and disclosures.

  • Avoidance of penalties, legal risks, and reputational damage.

  • Builds confidence among investors, regulators, and stakeholders.

Process of Secretarial Audit

  1. Appointment of a Practicing Company Secretary (PCS).

  2. Review of statutory registers, records, and e-forms.

  3. Verification of board processes, AGM/EGM, and disclosures.

  4. PCS issues a Secretarial Audit Report in Form MR-3.

  5. Report is annexed to the Board’s Report filed with ROC.

Due Date

  • Conducted annually for the financial year.

  • Report filed along with the Board’s Report in the Annual Filing (AOC-4, MGT-7).

Penalty for Non-Compliance

  • Company: Fine up to ₹5 lakh.

  • Officers in default: Fine up to ₹50,000.

  • PCS giving false certification: Liable for penalties and disciplinary action.

How Law to Corporate (LTC) Helps

  • Acting as your certifying PCS for Secretarial Audit.

  • Conducting independent review of compliance records.

  • Highlighting risks and recommending corrective actions.

  • Ensuring smooth and penalty-free annual filings.