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Board's approval of accounts,auditors report,qualification

suchi (assisstant clerk) (79 Points)

21 November 2012

Hello All

I want to clarify about the procedure of signing of Accounts.Firstly in a Board Meeting,Directors will approve the accounts & then forward those approved accounts to Auditors.Board approved accounts on 31 july,2012 & auditors signed the accounts with qualification on 2 August,2012.Now the Directors Report which require explanations regarding qualification in auditor's report is required before AGM.Now the question is do we require to convene another board meeting for signing of director's report with explanations on qualification.And suppose if there would have been no qualification do we need another board meeting or not???

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6 Replies

CS Ankur Srivastava (Company Secretary & Compliance Officer) (17853 Points)
Replied 23 November 2012

The procedure is as under:

First the director approve the Annual Accounts and submit the accouts to the Auditors for Audit and their Audit Report, then on receipt of Audite Annual Accounts Board approve the same and then director report is being signed and at last notice of AGM issued. Not it may be done in the following two ways:

First detailed way:

1. Hold Board Meeting approve the Annual Accounts and submit it to the auditors for audit and audit report;

2. On receipt of Audited Annual Accounts, hold another Board Meeting note the qualificaitons of Auditors, if any and approve the Audited Annual Accounts;

3. In this board meeting Directors' Report is to be approved;

4. Notice is to be issued in this board meeting or subsequent board meeting, however, notice period is to be kept in the mind.

Second, practical way:

Hold Board meeting approve the accounts and submit it to the Auditors and adjurn the meeting for an hour to reassemble and take on record Auditors Report.

Reassemble the meeting and take on record auditors report, and approve Audited Annual Accounts then approve directors' report and notice in the same Board Meeting.

Only below statement would be noted in the minutes of the Board Meeting:

THE MEETING WAS ADJOURNED FOR ONE HOUR TO REASSEMBLE TO TAKE NOTE OF AUDITORS’ REPORT ON THE ANNUAL ACCOUNTS FOR THE FINANCIAL YEAR ENDED 31^ST MARCH 2012 AND TO TRANSACT REMAINING ITEMS OF AGENDA.

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suchi (assisstant clerk) (79 Points)
Replied 23 November 2012

Thanks Sir, Second option can be done if we want to finish it in same day.But since here in this case audit report was issued after the approval date of accounts,we will have to do the board meeting for board report after the signing of audited B/S.Correct me if i m wrong.Thanks