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Sec 212 of companies act - very urgent

Anny Jain (ACS) (103 Points)

29 September 2011

Particulars required to be attached under section 212 of the Companies Act, 1956- whether necessary while approving the profit and loss account and the balance sheet by the Board of Directors of the holding company. That is to say can the Holding Company board of directors approve its annual accounts before the annual accounts of the subsidiaries are approved?

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5 Replies

Shloka (Deputy manager (Finance)) (48 Points)
Replied 29 September 2011

Dear Anny,

As per Section 215 of the Companies Act, 1956 balance sheet and profit and loss account are required to be approved by the Board of Directors before they are submitted to the auditors for their report thereon, Particulars as required under Section 212 of the Act are required to be attached to the above and not annexed hence they donot form part of the balance sheet and profit and loss account in view of Section 222 of the Act.

Hope this would solve your query.

Regards,

Shloka

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Anny Jain (ACS) (103 Points)
Replied 29 September 2011

Dear Shloka,

I agree with what you have said. Just wanted to know if my perception is right that:

Say, the Holding Co.Approves its annual accounts in board meeting dated 27.07.11.

Then on 02.08.2011 the board of the subsidiary approves the annual accounts.

Then I can hold the AGM of the Holding co. after the AGM of the subsidiary and place the annual accounts of subsidiary in the AGM of holding.

Am I right? Can this be done? I hope there is no violation of law in this.

reshmi (CS- Final Student) (33 Points)
Replied 12 October 2011

Dear Anny,

The Board Meeting for adoption of subsidiary companies' acounts have to be held before the Board Meeting for adopting the accounts of the holding company.

In your case.. the Board Meeting for adoption of subsidiary companies' acounts have to be held before 27.07.2011 (the date on which the holding compny's accounts are being adopted)

However, the AGMs of the subsidiary companies can be held after the AGM of the holding company..

Regards,

Reshmi