Do you know that ROC compliance is fundamental to your company regarding legal health and business transparency? Governed through the initiative of the Registrar of Companies (ROC compliance) forms a part of corporate governance in India, with special regard to private limited companies. This guide will outline how ROC compliance can improve the legal standing of your company and increase operational efficiency. So, make sure to stay till the end.
Annual compliance is important for maintaining the legal status of a private limited company in India, and can be broadly categorised into: mandatory compliances and event-based compliances.
1.
First Board Meeting: It should be accomplished within 30 days of incorporation to ensure timely governance and decision-making.
2.
Subsequent Board Meetings: At least four board meetings per annum should be conducted. This is important in ensuring oversight and accountability.
3.
Annual General Meeting (AGM): An ADM ensures transparency and shareholder involvement by review of performance, financials approval, and audit appointment.
4.
Annual Return Filing (Form MGT-7): To ensure the ROC maintains the legal records such as essential company information, every company is required to file its annual return within 60 days of the AGM.
5.
Filing of Financial Statements (Form AOC-4): A balance sheet, a profit and loss account, and a directors' report are to be filed within 30 days of the AGM for declaring financial health and showing compliance with accounting standards.
6.
Statutory Audit: This is necessary because a statutory audit by a qualified auditor provides assurance regarding the financial accuracy and compliance with the laws.
1.
Change in Registered Office (Form INC-22): Updates the ROC in regard to address changes; maintains accurate records.
2.
Change in Directors or Key Management Personnel (Form DIR-12): It notifies the ROC of personnel changes to ensure accurate information.
3.
Increase in Authorised Share Capital (Form SH-7): This enables a company to notify ROC about any changes in the capital structure of the corporation to maintain compliance.
4.
Change in Secured Borrowings (Form CHG-1): It ensures transparency over the changes in debt conditions.
5.
Filing of Resolutions and Agreements (Form MGT-14): This records proper documentation of the important decisions and resolutions adopted by the company.
Filing the ITR is more than a legal requirement. Here is how it helps you:
Steady compliance enhances the status of the company, thus attracting investors and stakeholders.
Accurate financial reporting aids in better financial management and informed business decisions.
Being compliant helps the company not fall into issues with penalties and legal issues, hence ensuring a seamless operation.
Regulatory compliance will free the business to establish clearly defined objectives without distractions stemming from problems of non-compliance.
Staying compliant inculcates confidence and stability, upon which long-term success for the company rests.
Complying with the ROC compliance for private limited companies is crucial so that the operations would run smoothly and without attracting litigation. Here follows a detailed checklist for private limited companies:
Companies having paid-up share capital more than ₹5 crores or turnover more than ₹100 crores, the financial statement shall be filed in XBRL e-form within a period of 30 days from the date of conclusion of the AGM.
Form MGT-7A (for small companies and OPC), MGT-7 (for others). Companies having a paid-up share capital exceeding ₹10 crores or turnover more than ₹50 crores shall file annual returns within the 60 days from the date of AGM.
Disclosure of interest and non-disqualification have to be made by each director at the first board meeting of every financial year.
Every director shall file his KYC on or before 30th September every year.
It needs to be filed on or before 30th June of every year for the disclosure under the deposits and other related transactions.
To be filed within 15 days from the date of AGM for the reappointment or appointment of an auditor.
To be filed within a period of 60 days from the date of AGM for reporting unclaimed or remaining unpaid dividends and other amounts in compliance with the IEPF rules.
This form has to be filed within a period of 30 days from the date of receipt of Form BEN-1, for disclosure of significant beneficial ownership that will bring about transparency in ownership.
Submit half-yearly on or before 30th October and 30th April declaring the amount of outstanding payments to MSMEs to monitor time-bound payments.
To be filed in case of any change in the board of directors.
Required for directors and shareholders, including identity proofs like Aadhaar, PAN, and Passport; address details; DSC of director.
Provide details of the company's Memorandum of Association (MOA), Articles of Association (AOA), the incorporation certificate, and details of auditors - firm registration number and the terms of his appointment.
Furnish audit & board report, bank statements of directors, balance sheet, profit & loss statement, minutes of meetings.
Maintained registers of shareholders, directors, and charges.
Obtain compliance certificate, GST registration, ESI, PF, Shop and Establishment, MSME registration if any.
The cost of annual compliance for a private limited company in India varies depending on the size of the company, its activities, and location. The minimum necessary compliance charges to offer for the start-up companies start at ₹10,999, and may increase thereafter based on additional requirements.
Key expenses include:
| Particular | Fee |
| Audit Fees Filing Fees Regulatory Charges Legal Consultation and Software Costs | From ₹5,000 to ₹5,00,000, or more. Varies with the share capital, starting from Rs. 200 per document. Can range from a few thousand to several lakhs. Additional fees for the legal consultation and the purchase of accounting software. |
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Compliance with ROC for private limited companies is compulsory, as it makes sure that the company complies and adheres to the Companies Act, 2013, thereby maintaining legal standing.
Yes, an audit is compulsory for all private limited companies as a means of verifying their financial statements every year for accuracy and compliance with any statutory requirements.
Yes, it is worth hiring a Chartered Accountant for the purpose of getting the ROC filing done correctly and on time.
Private limited companies, public limited companies, and limited liability partnerships (LLPs) have to get themselves registered with ROC.