Good Corporate Governance is a basic attribute of a healthy organization. Adherence to Corporate Governance principles increases the value of the organization and trust of stakeholders. In India, there are various statues, laws, rules and regulations that are applicable to the Corporate Sector. For reducing the risk of frauds as well as potential cost of non-compliance of applicable provisions, it has become essential to conduct an effective audit. Companies Act, 2013 talks about the concept of Secretarial Audit as a class of new audit in addition to other audits.
APPLICABILITY OF SECRETARIAL AUDIT
It is mandatory for the following companies to conduct Secretarial Audit:
- Every Listed Company
- Every Public Company having paid-up share capital of Rs. 50 crores or more
- Every Public Company having turnover of Rs. 250 crores or more
- Every Company having outstanding loans and borrowings from banks or financial institutions of Rs. 100 crores or more
WHO SHALL CONDUCT THE SECRETARIAL AUDIT:
Only a member of the Institute of Company Secretaries of India, holding a certificate of practice, can conduct a secretarial Audit and on the basis of the audit done, he/she shall furnish the official Secretarial Audit Report to the Company in Form No. MR-3.
OBJECTIVES OF SECRETARIAL AUDIT
- To check and report on compliance
- To take correctives measures for non-compliance
- To safeguard the interest of directors and investors of the company
- To prevent unreasonable legal actions by law enforcing agencies
PROCESS FOLLOWED BY US FOR SECRETARIAL AUDIT
- To gather all relevant documents and information of the Company which are required for audit.
- Issuance of the formal engagement letter to the auditor which will communicate the scope and objectives of audit.
- Meeting of the Auditor with all senior management and other staff who may be involved in the audit process.
- To Plan the audit programme.
- Preparation of Working Papers to support the audit opinion.
- Preparation and submission of the audit observations with the management.
- Discussion of all the Audit Observations with the management of the Company.
- Receipt of response from the client for audit observations. Based on the response, Secretarial Audit Report (Form MR-3) will be submitted to the Client Company.
- Follow up and request to the Company to take all corrective actions.
THE J&P ADVANTAGE
Our Secretarial Audit Team at J&P handles the whole process with utmost due diligence. From documents compiling to final submission of Audit Report our team works with utmost care leaving no potential loopholes. Our Team believes in adhering to timelines to eliminate unnecessary complications and works to achieve the best results.