Secretarial Audit is basically an audit which helps in checking the compliances related to various legislation like Companies Act and many other laws including the corporate and economic ones that are applied on a company. It basically helps in accomplishing the objective of the organisation by bringing in all the required managements and processes in place.
Hence it can be said that Secretarial Audit provides all the requirements to comfort all the entities of the company by giving them proper governance along with other important systems.
What are the advantages of Secretarial Audit?
The Secretarial Audit is one of the best tools to implement confidence among all the stakeholders of a company. It also helps in instilling regulations and discipline in the company along with mitigating risk and addresses the compliance risk issues effectively. In other words, this is majorly responsible for building up of a company’s corporate image. It helps different stakeholders in different ways and helps the company as a whole by laying the foundation of a good governance system, lessening their chances of receiving penalties and constructing an effective compliance management program.
Who can conduct the audit and which companies needs to undergo it?
Secretarial Audit process can be conducted by a certified practitioner from the Institute of Company Secretaries of India. Talking about the companies who needs to undergo the audit, here is the list:
- Every company which is listed
- All the public companies that have a paid up share capital of Rs. 50 crores or more than that.
- All the public companies with a turnover of Rs. 200 crore or more.
Is the audit mandatory?
According to the Companies Act 2013, all the listed companies that belong to the class defined needs to have the audit by a practiced Company Secretary. However the company that falls out of Section 204 can take out the report voluntarily as that would depict the assured compliance of the given company.
The audit can basically help a company to initiate corrective measures continuously along with strengthening the compliance and other processes. Hence it is desirable that the audits are carried out on a periodic basis. In case you need some advice on the same, you can take the help of Taxing consultancies like Ezybiz India that can provide all round guidance about the audits and help your company to shine.