Key Action in New Companies act 2013

List of issues and actions which needs immediate attention of the Board in reference to provisions of the new law:

Preliminary

• Identification of new provisions which are applicable to your company including provisions based on criteria of capital, turnover, profit etc for instance Women Director, Internal Audit etc.

Timelines

• Identifying filing date for key events
• Identifying timelines for issue of share certificates
• Compliances with the transition period
• Reworking on the Corporate Structure

• Identification of Holding/Subsidiary & Associate Company based on the change in definition of Total Share capital
• Checking companies which may be converted to Dormant Company

Charter Documents & Registers

• Alteration of MOA where other objects are undertaken
• Alteration of AOA or Adoption of Table F

Fund Raising

• Consideration of altered Private placement norms
• Repayment of Deposits by specified companies
• Acceptance of Deposits by Private Company from Shareholders and Relatives of Directors; out of the exempted category

Statutory Audit

• Review of the term of the Auditor
• Review of services provided by the Auditor
• Review of eligibility of Auditor to continue services in the company

Other audit requirements

• Cost audit
• Secretarial audit for financial year 2013-14
• Internal Audit

Board Meetings

• Notice of Board Meeting (facility of Video Conferencing)
• Electronic Dispatch with receipt acknowledgement due
• Quorum (Disinterested Directors even for Private Limited Company)
• Resolution by Circulation –changed norms

Board Constitution

• Reconstitution of the Board
  • Women Director
  • Independent Director
  • Resident Director (if required)
• Appointment &Designation of KMP
• Consideration of separation of position of MD & Chairman Determining Directors liable to retire by rotation
• Determining Directors liable to retire by rotation
• Maximum number of directorship to be reviewed

Board Processes

• New disclosure of Interest from Director
• Disclosure of Independence  from Independent Directors
• Checking of Directors' disqualifications (for instance, if the person is the director of the Company which has not filed financial statements or annual returns for any continuous period of three financial years)
• Powers of the Board (items to be conducted in the Board meetings)
• Informing new restrictions to Directors
  • Restriction on non cash transaction
  • Forward Dealing
  • Insider Trading
• Circulation of new roles and responsibilities, do's and dont's to Directors and KMPs
• Resignation of Director – requirement to forward their resignation to ROC

Related Party Transactions

• Framing the list of Related party as per new law
• Related party transactions (fresh or renewal requires new procedure)
• Immediate shareholders approval requirements for certain related party transactions which were earlier exempted
• Restructuring of transfer of funds within group
• Restrictions on loan to directors.

Remuneration& Appointment of Directors

• Consideration of Remuneration limits for executive and non-executive directors (for FY 2013-14)Remuneration of Non-Executive
• Sitting fees for Independent Directors

Committees

• Reconstitution of
  • Audit Committee
  • Stakeholders Committee
  • Nomination and Remuneration Committee
• Constitution of CSR Committee
• Framing of charters of committees

Framing Policies & documents

• Framing Vigil Mechanism
• CSR Policy
• Code of conduct for Independent Directors
• Remuneration Policy
• Policy on Performance Evaluation of Independent Directors
• Policy on Related Party Transactions
• Policy on Selection Criteria of Independent Directors (as required to be formulated by Nomination and Remuneration Committee)
• Contract of appointment of MD / WTD
• Appointment Letter of Independent Directors

General Meetings 

• Quorum (Non Participation of interested shareholder)
• Proxy
• E-voting requirements
• Disclosure in Notices, Explanatory Statement etc

Accounts

• Books of Accounts (may be prepared in electronic mode)
• Realignment of financial year
• Financial statement  - to include Cash Flow Statement

Stationary & others

• Print of name etc before the registered office
• Change in office stationary eg. business letters, billheads, letter papers etc
  • Company Name and address
  • Corporate Identity Number
  • Telephone number, fax number, if any, e-mail and website addresses, if any
• Publication of authorised capital, subscribed capital and paid up share capital at documents

Documentation

• Preparation of Statutory Registers in new format (Register of members. etc) Maintenance of any document, record, register, minutes, etc. in electronic form
• Maintenance of any document, record, register, minutes, etc. in electronic form

List of resolutions , which are recommended to be passed at the forthcoming Annaul General meeting of the Company:

• Alteration of Articles of Association or adoption of table F.
• Alteration of Memorandum of Association where other objects are undertaken
• The appointment of Women Director, Resident Director and Independent Director is to be approved by the Company in a general meeting
• Approvals for related party transactions
• Approval for limits under section 186- Loans and Investments by companies
• Appointment/ ratification of statutory auditors and fixing their remuneration
• Approval for managerial remuneration
• Approval for borrowing limits under section 180.
• Appointment of Statutory Auditor

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CA SANJAY DEWAN

B.COM (H),FCA

FCMA,LCS,MIMA