There are two directors in a private limited company, both of whom have invested equal amounts in the company. They have entered into an agreement that each of them will draw 50% of Profit every month as their remuneration.
Is this agreement OK and will the assessing Officer accept it as the company will have no profit left.
04 June 2011
According to me the Director's remuneration should not be more than 5% of the last three financial year profit but they received more than, so i think it is not possible.
CAclubindia
