What concequences are there in Companies Act 2013 if one company is associated of other company (holding more than 20% shares).
What is to be done in order to reduce the share percentage?
3 Replies
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 20 June 2014
Consequences: Associate will be related party u/s 2(76) and you will have to prepare consolidated financial statements u/s 129(3).
Action required to reduce holding: You have to transfer shares in normal manner (Board resolution + share transfer Form SH.4 etc.)
Vivek Jain
(CS)
(205 Points)
Replied 20 June 2014
Thank You Sir for your reply.
I further want to know what is the time period for share tranfer so that my holding reduce to less than 20% and no consolidated B/S need to be prepare.
P C Agrawal
(Registered independent director Past Chairman of Aurangabad Chapter of ICSI Practicing Company Secretary at Aurangabad)
(8229 Points)
Replied 20 June 2014
You should transfer shares before the end of the current financial year.
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