Mandatory Compliances for a Private Limited Company

“Private company” are those firms that are having a minimum paid-up share capital which may be endorsed or prescribed by its articles and which,—

(i) limit the rights to transfer its shares

(ii) except in the case of OPC, limits the number of its members to 200:

Given that, persons will be treated as a single member, for the clause where more than 2 persons hold more than 1 shares in a company jointly:

Provided further that—

(A) persons, who are previously in the employment of the company, were members and have remained to be members after the employment break off; and

(B) persons, who are in the employment of the company,

shall not be involved in the list of members; and

(iii) all invitations are forbidden to the public to subscribe for any securities of the company.

There are various compliances which a private limited company has to mandatorily ensure:

Appointment of Auditor

The first auditor of a company shall be appointed by the BOD within 30 Days from the date of Incorporation of the company and such auditor shall hold office till the conclusion of the 1ST AGM and in the case of failure of the Board to appoint such auditor, it shall inform the members, who shall within 90 days at an EGMappoint such auditor.

The company has to Appoint a Statutory Auditor for Finalizing the Annual Accounts. The statutory auditor is required to examine the information such as financial transactions, bookkeeping records, and bank balances and determine whether an organization is providing a true and fair representation of its financial position or not.

Board Meetings

Annual ROC Filings

Filing of Financial Statements (Form AOC-4)

Every Private Limited Company within 30 days of holding an Annual General Meeting is required to file its Final statement, Notice of AGM, and Director Report (along with all its annexures) in form AOC-4.

Filing of Financial Statements (Form AOC-4XBRL)

*Specified PrivateCompanyshall within 30 days of holding of Annual General Meeting is required to file Financial statementin form AOC-4XBRLwhich are below:-

*Note:Company is required to file AOC-4 XBRL whose having: –

  • XBRL
  • paid-up share capitalRs. 5 crores or more OR
  • Turnover of Rs.100 croreor more.
  • Companies that are required to prepare their financial statement in accordance with Companies(Indian Accounting standards) rule, 2015.

Filing of Annual Return (Form MGT-7)

Every Private Limited Company within 60 days of holding of Annual General Meeting (AGM) is required to file its Annual Return in MGT-7 for the period 1st April to 31st March.

Filing of Form MGT-8 (Certification by PCS on Annual Return)

Private Limited Company is required to file MGT-8 who have: –

  • Paid-up share capital of Rs. 10 crores or moreor
  • Turnover of Rs.50 croreor more.

Signing of Financial Statement

The Board of Directors shall approve the financial statement, including consolidated financial statement(CFS), if any, and signed at least by-

  • the chairperson of the company who is authorized by the Board or
  • 2 directors out of which 1 shall be MD (if any)and the CEO, CFO, and CSof the company, wherever they are appointed, or
  • Only by one director, in the case of OPC.

Annual General Meeting

Maintenance of Statutory Registers and Records

A Private Limited Company has to maintain various statutory registers and records under the companies act 2013 which are specified below:

  • Register of shares,
  •  Register of Members,
  • Register of Directors.
  • Incorporation documents of the company,
  • Resolutions passed in the meetings of the Board of Directors(BOD),
  • Minutes of the Board Meetings(BM) and Annual General Meeting (AGM)etc.

Such records shall be open for inspection to its members during business hours and should be kept at the registered office of the company. Also, every company should be preserved and kept in the books of account for at least 8 financial years.

Minutes of Meetings

 Every company shall have to prepare minutes of the proceedings of:-

  • every Annual general meeting (AGM)
  • every meeting of any class of shareholders or creditors,
  • every meeting of its Board of Directors (BOD)
  • every committee of the Board,

aforementioned minutes to be signed and arrange and kept within 30 days of the closure of every meeting passingor concerned of a resolution by postal ballot in books that are kept with consecutively numbered pages.

  • The minutes of each meeting shall contain a true, fair, and correct summary
  • All appointments made shall be included in the minutes of the meeting.
  • the names of the directors present at the meeting, etc.

This content is meant for information only and should not be considered as an advice or legal opinion, or otherwise. AKGVG & Associates does not intend to advertise its services through this.

Posted by:

CA Neetu Saini

AKGVG & Associates

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