Stakeholder raised a query seeking clarification that as under section 101 companies are allowed to convene meeting at a Shorter Notice, does the provisions of section 136 allow the same for Financial Statements?

MCA clarified that Companies convening General Meeting at a Shorter Notice can circulate Finanical Statements to be considered at that meeting at a Shorter Notice, it further clarified that Companies having Subsidiaries are required to place on its website seperate audited accounts in respect of each subsidiary.

It further clarified that the 4th proviso to Section 137(1)requires that a company shall attach along with its financial statements to be filed with the Registrar, the accounts of its subsidiary(ies) which have been incorporated outside India and which have not established their place of business in India. Clarification has been sought on –

(a) Whether a company covered under above provisions can place/file unaudited accounts of a foreign subsidiary if the audit of such foreign subsidiary is not a mandatory legal requirement in the country where such foreign subsidiary has been incorporated and such audit has not been conducted?

• It is clarified that Companies can place such unaudited accounts on its website in compliance of the provisions of section 136 & 137 of the Companies Act, 2013. If the same are not in English the translated copy of the said Financial Statements in English is to be put on the website.

(b) Whether accounts of such foreign subsidiary would need to be as per format under Schedule III/Accounting Standards.or the format as per country of incorporation of the foreign subsidiary would be sufficient?

• Further, the format of accounts of foreign subsidiaries should be, as far as possible, in accordance with requirements under Companies Act, 2013,  where it is not possible, a statement indicating the reasons for deviation may be placed alongwith such accounts.

The said Circulars can be accessed at the following link: General Circular 11-2015 dated 21.07.2015