TMI BlogBoard’s ReportX X X X Extracts X X X X X X X X Extracts X X X X ..... raised during the year, utilization of funds for the purpose for which it was raised, repayment of public deposits, liability for unclaimed deposits and long term agreements including with employees which have substantial financial impact are included in the Board s Report. The Report should also contain the information and explanations on every reservation, qualification or adverse remarks contained in the auditor s report. The Board s Report of a listed company should include a statement on compliance of corporate governance norms within the company and also a report covering management discussion and analysis (MDAR). Certain additional disclosures are also required to be made in Board s Report under various other enactments. Scope This Standard seeks to lay down practices pertaining to the preparation and presentation of the Board s Report. Definitions The following terms are used in this standard with the meaning specified: Act means the Companies Act, 1956 (1 of 1956) , or any statutory modification or re-enactment thereof. Board means the Board of Directors of a company. Company means a company as defined in section 3 of the Act. Fi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r means a Member as defined above and, where the context requires or admits, includes Preference Shareholder. Sickness in the case of a company means it has- (i) accumulated losses in any financial year equal to fifty per cent or more of its average net worth during four years immediately preceding such financial year; or (ii) failed to repay its debts within any three consecutive quarters on demand made in writing for its repayment by a creditor or creditors of such company. Unless the context otherwise requires, words and expressions used herein and not defined shall have the meaning respectively assigned to them under the Act. Secretarial Standards Under the Act it is the Board s responsibility to make out its report to the Shareholders with reference to matters set out in the Act and attach the said report to every balance sheet laid before the company at its annual general meeting. 1. Disclosures Pursuant to the Act 1.1 Every company should attach the Report to the balance sheet of the company laid before its annual general meeting. 1.1-1 The Report should deal with the state of affairs of the company. The state of affairs of the company shou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y subsidiaries; - the class of business in which the company has an interest. In the case of an unlisted subsidiary, the report of the holding company should include an affirmation by the Board that it has reviewed the affairs of the subsidiary company. Even when no material changes in the company s subsidiaries or in the nature of business carried on by them has taken place during the year, the highlights of the performance of the subsidiaries should be briefly stated in the report. Such information relating to joint ventures, if any in the report should also be provided. A statement of holding company s interest in subsidiaries as required under sub-section (3) of section 212 the Act should be provided by way of an annexure. If the holding company is unable to obtain such information, a report in writing is required to be attached to the balance sheet. 1.3 The Report should include the particulars of specified employees of the company who were in receipt of remuneration beyond prescribed limits. The particulars should be furnished either in the body of the report or by way of an annexure thereto in the format as prescribed in Companies (Particulars of Employe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a result of issue of sweat equity shares; (e) money realized or benefit accrued to the company from the issue of sweat equity shares; (f) diluted earnings per share pursuant to issuance of sweat equity shares. 1.8 The Report should specify the status of the buy-back process up to the date of the Report and reasons, if any, for the failure to complete the buy-back of securities within the time prescribed under the Act. 1.9 The Report should specify the reasons for the failure to implement any proposal relating to preferential allotment. 1.10 The Report should specify the reasons for the failure to pay interest or redeem debentures or preference shares on due date(s) and remedial measures taken. If failure continues it should be disclosed in the subsequent Reports. 1.11 The Report should specify changes in the composition of Board. The Report should also specify changes in management or control. 1.12 The Report should disclose if any director has incurred any disqualification or vacated office pursuant to the provisions of the Act or any other law for the time being in force. 1.13 The Report should disclose the amounts, if any, transferred during the yea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mployee Stock Option Scheme (ESOS). The Report should contain the following disclosures: (a) options granted; (b) the pricing formula; (c) options vested; (d) options exercised; (e) the total number of shares arising as a result of exercise of Options; (f) options lapsed; (g) variation of terms of Options; (h) money realised by exercise of Options; (i) total number of Options in force; (j) employee-wise details of Options granted to - (i) senior managerial personnel; (ii) any other Employee who receives a grant in any one year of Option amounting to 5 per cent or more of option granted during that year. (iii) Identified Employees who were granted Options, during any one year, equal to or exceeding 1 per cent of the issued capital (excluding outstanding warrants and conversions) of the Company at the time of grant; (k) diluted Earnings Per Share (EPS) pursuant to issue of shares on exercise of Option calculated in accordance with AS-20 relating to EPS. (l) where the Company has calculated the Employee Compensation cost using the intrinsic value of the Options, the difference between the Employee Compensation Cost so computed and the Em ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of accounts of public deposit with the company which have not been claimed by the depositors or not paid by the company after the date on which the deposit became due for repayment; and (ii) the total amounts due under such accounts remaining unclaimed or unpaid beyond the due date for repayment. The said particulars or information shall be furnished with reference to the position as on the last day of the financial year to which the report relates and if the amounts remaining unclaimed or undisbursed as referred to in clause (ii) of the preceding sub-paragraph exceed in the aggregate a sum of rupees five lakhs, there shall also be included in the report a statement on the steps taken or proposed to be taken by the Board for the repayment of the amounts due to the depositors remaining unclaimed or undisbursed. 5.2 Miscellaneous Non-Banking Companies 5.2-1 The Report should include information on: (i) the total number of depositors with the company whose deposits have not been claimed by the depositors or paid by the company after the date on which the deposit became due for repayment or renewal as the case may be according to the contract with the depositor or the Mi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... five lakhs, the Report should also include a statement on the steps taken or proposed to be taken by the Board for the repayment of the amounts due to the depositors or group of joint depositors and remaining unclaimed or undisbursed. 7. Other disclosures 7.1 The report should state that the consolidated financial statements are also presented in addition to the individual financial statement of the company. 7.2 The report should specify projections made in the previous year and the current status related to the company s performance. The report should also specify the reasons for the failure to meet the projections made in the previous year s report, if any. If there are material variations in the projections and current status relating to the actual utilisation/profitability and project implementation status, the same shall be explained in the report. A list of additional information which may be given in the Report is placed at Annexure-I. 8. Explanations in the board s report in response to auditors qualifications 8.1 The report should contain the information and explanations on every reservation, qualification or adverse remarks contained in the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... directors though the report may have been approved only by a majority of the directors. The dissent, if any, of any director(s) on any item in the Report shall be reflected in the minutes of the meeting but not in the report. 13.2 The Board shall be collectively responsible for any statement in its report which is false in any material particular or for any omission of a material fact, knowing it to be material. 14. Filing of the board s report 14.1 The report along with audited annual accounts should be filed with the Registrar of Companies within the prescribed time limit. 15. Consistency 15.1 The Board should ensure consistency of information given in the report, the report on Corporate Governance and the explanatory statements to resolutions. 16. Right of members to copies of report 16.1 A copy of the report along with balance sheet and profit and loss account and auditors report should be sent so as to reach every member at least 21 days before the date of the annual general meeting. 16.2 The report should be supplied to each Member and upon application to any member of the stock exchange in case of a listed company. The report should als ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
