Companies (Accounts) Amendment Rules, 2022

BACKGROUND

The Ministry of Corporate Affairs has issued a notification dated 11th February, 2022 which shall be effective of its publication date, the Companies (Accounts) Amendment Rules, 2022 to further amend the provisions of the Companies (Accounts) Rules, 2014.

Preamble

• Section 135 of the Companies Act, 2013
  Every company fulfilling the below stated criteria during the immediately preceding financial year, is required to constitute a Corporate Social Responsibility Committee of the Board comprising of 3 or more Directors, out of which at least one director shall be an independent director and where a company is not required to appoint an independent director under sub-section (4) of section 149, it shall have in its Corporate Social Responsibility Committee with 2 or more Directors:
  1. having net worth of 500 crores rupees or more or
  2. having turnover of 1000 crores rupees or more or
  3. having net profit of 5 crores rupees or more.
  The Board of every company must ensure that in every financial year, at least 2% of the company’s average net profits made during the 3 immediately preceding financial years or in case the company has not completed the period of three financial years since its incorporation, during such immediately preceding financial years, has been spent in pursuance of its Corporate Social Responsibility Policy.
• Section 137(1) of the Companies Act, 2013 read with Rule 12(1), 12(1A), 12(2) of the Companies (Accounts) Rules, 2014 and Rule 3 of the Companies (Filing of Documents and Forms in XBRL) Rules, 2015
  A copy of financial statements including consolidated financial statement, if any, and other stipulated documents which are duly adopted at the annual general meeting shall be filed with the Registrar within thirty days of the date of annual general meeting as under:
  1. Form AOC-4 for filing of financial statements by a company
  2. Form AOC-4 CFS for filing of consolidated financial statements, if any by a company
  3. Form AOC-4 NBFC (Ind AS) for filing of financial statements by Non-Banking Financial Company (NBFC) obligated to comply with Indian Accounting Standards (Ind AS)
  4. Form AOC-4 CFS NBFC (Ind AS) for filing of consolidated financial statements by Non-Banking Financial Company (NBFC) obligated to comply with Indian Accounting Standards (Ind AS)
  5. Form AOC-4 (XBRL) for filing of financial statements by the following:
     • Listed Indian Companies and their Indian subsidiaries
     • Companies having paid-up capital of 5 crores rupees or above
     • Companies having turnover of 100 crores rupees or above
     • Companies obligated to prepare their financial statements in line with Companies (Indian Accounting Standards) Rules, 2015

In Companies (Accounts) Rules, 2014 in Rule 12, after sub-rule (1A), a new sub- rule 12(1B) has been inserted of the Companies (Accounts) Rules, 2014 by virtue of these amendment which is as follows:

1. Rule 12(1B) states that every class of company which is obligated to constitute a Corporate Social Responsibility Committee in accordance with the provisions of sub-section (1) of Section 135 of the Companies Act, 2013, is required to furnish a report on Corporate Social Responsibility in Form CSR-2 to the Registrar for the preceding financial year i.e., 2020-2021 and onwards as an addendum to Form AOC-4 or AOC-4 XBRL or AOC-4 NBFC (Ind AS), as are applicable.
2. Also, the class of companies which are required to file Form CSR-2 shall ensure to file it separately for the preceding financial year i.e., 2020-2021, on or before 31st March 2022, after filing Form AOC-4 or AOC-4 XBRL or AOC-4 NBFC (Ind AS), as are applicable.
3. A copy of Form CSR-2 has also been provided in the annexure of the said rules.

Disclaimer

The information provided in this article is intended for general informational purposes only and should not be construed as legal advice. The content of this article is not intended to create and receipt of it does not constitute any relationship. Readers should not act upon this information without seeking professional legal counsel.