Board Processes through Secretarial Standards – Governance, Risk Management, Compliances and Ethics Important Questions
Question 1.
“For the first time in the history of Company Law in India, the Compa¬nies Act, 2013 has given statutory recognition to the Secretarial Standards issued by the Institute of Company Secretaries of India.” Discuss.
Answer:
Yes, for the first time in the history of Company Law in India, the Companies Act, 2013 has given statutory recognition to the Secretarial Standards issued by the Institute of Company Secretaries of India (ICSI).
Section 118(10) of the Companies Act, 2013, provides that:
“Every company shall observe secretarial standards with respect to general and Board meetings specified by the Institute of Company Secretaries of India constituted under section 3 of the Company Secretaries Act, 1980, and approved as such by the Central Government.”
Secretarial Standards-1 : applies to Meetings of the Board of Directors and its Committees. It prescribes a set of principles for convening and conducting Meetings of the Board of Directors and matters related thereto.
Secretarial Standards-2 : applies to General Meetings of the Shareholders. It prescribes a set of principles for convening and conducting General Meetings of the Shareholders and matters related thereto.
Therefore, Secretarial Standards issued by the ICSI assumes special relevance and companies have to ensure that there is compliance with these standards on their part.
Question 2.
A meeting of Board of Directors is to be held to review the financial performance of the company as well as declaration of dividend. Draft a notice and agenda of this meeting to be circulated to the Board of Directors in accordance with the relevant provisions of Companies Act, 2013.
Answer:
XYZ Co. Ltd. New Delhi
Notice of – (Serial Number of Meeting) Board Meeting
12th June 2017
The _________ (Serial Number of Meeting) meeting of the Board of Directors will be held on _________ (Day) the 22nd day of June 2017 at Meeting Lounge of the registered office of the Company situated at _________ (Complete Address) at 10:00 am. All directors are hereby requested to kindly make it convenient to attend the same.
The agenda for the meeting are as follows:
- To elect a Chairman of the Meeting.
- To grant leave of absence to Directors not present at the Meeting.
- To take note of the minutes of the previous meeting.
- To note the action taken in respect to earlier decisions of the Board.
- To note the minutes of meetings of Board’s Committee(s).
- To discuss the financial performance and decide on dividend declaration.
- Any other matter, with the permission of the Chairman and majority of directors.
Annexure:
- Audited financial statements of last three quarters
- Copy of minutes of last meeting
- Action Taken Report (ATR) as received from the Administrative Division
- Resolution on dividend policy and report on dividend payment and declaration of the company of last three financial years
- Copy of minutes of the meeting of Audit Committee, Investment Committee, Remuneration Committee and Research Committee
Sd/- Sd/-
Company Secretary Chairman, Board of Directors
Question 3.
Answer the following in brief; For a successful Board meeting it is important to have a proper Board agenda. What are the key factors for setting the Board agenda?
Answer:
The board agenda determines the issues to be discussed in the Board meeting of an organisation.
Key success factors for setting the agenda include:
- Agendas should strike a balance between reviews of past performance and forward-looking issues.
- Strategic issues require more time for debate so it is a good practice that the allocated discussion time is indicated in the agenda.
- Normally the agenda in the Board Meeting should include the minutes of the last meeting.
- Any specific proposals which require the Board’s approval/confirmation should be included in the agenda.
Question 4.
Being the company secretary of a large scale company, how will you ^ prepare a board agenda and what are the steps you will follow for circulation of notice and agenda?
Answer:
Preparation of Agenda: The board agenda determines the issues to be discussed. The items for agenda should be collected from heads of all the departments.
Agenda at the request of a director:
Any director can request that the chairman include a matter on the board agenda. It is the chairman’s obligation to offer directors the opportunity to suggest items, which cannot be reasonably denied. In the end, it is each director’s responsibility to ensure that the right matters are tabled. It should be taken care of that agendas should strike a balance between reviews of past performance and forward-looking issues.
An agenda should show the amount of time allocated for each item, without unduly restricting discussion. Routine or administrative matters should not consume too much of board’s time.
Steps for Circulation of Notice & Agenda
Notice :
1. Even if meetings have been scheduled in advance, the members of the Board should be adequately and timely sent notice to enable them to plan accordingly.
2. Each item of business requiring approval at the Meeting shall be supported by a note setting out the details of the proposal, relevant material facts that enable the Directors to understand the meaning, scope and implications of the proposal and the nature of concern or interest, if any, of any Director in the proposal, which the Director had earlier disclosed.
Agenda:
1. The agenda should be made available to the Board along with sup-porting papers at least seven days before the date of the meeting.
2. Mode of circulation of agenda: The mode of circulation of agenda should ensure that all directors receive the agenda notes on time.
3. Material information: All the material information should be sent to all Directors simultaneously and in a timely manner to enable them to prepare for the Board Meeting.
4. Clarifications on the agenda: A system should exist for seeking and obtaining further information and clarifications on the agenda items before the meeting. Directors, including nominee directors, requiring any clarification before the meeting may be asked to contact the Secretary for additional inputs.
5. Board Briefing Papers: Board materials should be summarized and formatted so that board members can readily grasp and focus on the most significant issues in preparation for the board meeting. Board papers associated with a particular agenda item should be set out as an executive summary with further detail provided in annexes. , Information should be distributed at least seven business days before the meeting.
6. Any item not included in the Agenda may be taken up for consideration with the permission of the Chairman and with the consent of a majority of the Directors present in the Meeting.
Question 5.
Write a note on Secretarial Standard related to minutes of meeting.
Answer:
Section 118(10) of the Companies Act, 2013 introduces Secretarial Standards and provides statutory recognition to Secretarial Standards issued by ICSI as under:
- SS-1: Applies to Meetings of the Board of Directors and its Committees,
- SS-2: Applies to General Meetings.
SS-1. Applies to Meetings of the Board of Directors and its Committees, Highlights of Secretarial Standards are as under:
- Every company shall keep Minutes of all Meetings (Board, Committee and General Meetings) in Minutes Books.
- Minutes shall be preserved permanently in physical or electronic form.
- Minutes in electronic form shall be maintained with Time stamp. Minutes Books shall be kept in the custody of the Company Secretary.
- Minutes shall contain a fair and correct summary of the proceedings of the Meeting. Minutes shall be written in clear, concise and plain language.
- The pages of the Minutes Books shall be consecutively numbered. Minutes shall not be pasted or attached to the Minutes Books, or tampered with in any manner. Minutes, if maintained in loose-leaf form, shall be bound periodically.
- Minutes of the Board & Committee Meeting shall be kept at the Registered Office of the company or at such other place as may be approved by the Board. However, Minutes of General Meetings shall be kept at the Registered Office.
Question 6.
Ayesha Ltd. is engaged in managing events. A Board meeting is recently held at the head office of the company to expand its business operations to new areas. As a Company Secretary of the company, you are required to prepare minutes of this Board meeting.
Answer:
Specimen Minutes of a Board Meeting:
Minutes of the 2nd Meeting of the Board of Directors of Ayesha Ltd. held on 3rd June, 2016 at A/16, CP, New Delhi from 9 AM till 1 PM
Present:
- Mr. A.B. – Chairman
- Mr. C.D. – Directors
- Mr. E.F. I. J. K.L. – Managing Director
In Attendance:
- Mr. X. Secretary
Invitees:
- Mr. Y….. Chief Financial Officer
- Mr. Z….. Designation and Organisation
Question A.
Chairman for the Meeting
Answer:
Mr/Ms was elected as the Chairman for the Meeting.
Question B.
Leave of absence
Answer:
Leave of absence from attending the Meeting was granted to Mr. M.N. and Mr. O.P. who expressed their inability to attend the Meeting owing to their preoccupation.
Question C.
Quorum
Answer:
The business before the Meeting was taken up after having established that the requisite quorum was present.
Question D.
Minutes of the previous Board Meeting
Answer:
The Minutes of the ….. Meeting of the Board of Directors of the company held on ……., as circulated, were noted by the Board and signed by the Chairman.
Question E.
Minutes of the Committee Meetings
Answer:
The Minutes of the …… Meeting of the …… Committee held on ………., as circulated, were noted by the Board.
Question F.
Resolution passed by circulation since the last Meeting
Answer:
The following Resolution was passed by circulation on …… (date of passing of the Resolution) in terms of the provisions of Section 175 – of the Companies Act, 2013. .
“RESOLVED THAT …………….”
Mr ……………, Director dissented on the Resolution.
Question G.
Action Taken Report
Answer:
The following action taken was noted by the Board: Item No. Item Action Taken ……………..
Question H.
Register of Contracts
Answer:
The Register of Contracts in which Directors are interested under Section 189 of the Companies Act, 2013 and the Rules thereunder was signed by all the Directors present.
Question I.
Notices of Disclosure of Interest of Directors –
Answer:
a. The following Notices received from the Directors of the company, notifying their interest in other bodies corporate pursuant to the provisions of Section 184 of the Companies Act, 2013, were read and recorded: Name of the Director Nature of Interest Date of Notice
b. A Notice dated received from Mr. IJ. pursuant to the provisions of Section 170 of the Companies Act, 2013, disclosing his shareholding and the shareholding of Mrs. IJ. in the company was read and recorded.
Question J.
Expansion of business operations in new areas
Answer:
The Chairman informed the Board that it was proposed to expand business operations in other states like . The matter was discussed in this connection and it was decided to expand operations in
Question K.
Conclusion of the Meeting
Answer:
There being no other business, the Meeting concluded with a vote of thanks to the Chair.
Date …………………. …………………. Chairman
Place ………………….
Entered on
(To be initialled by the Company Secretary)
Question 7.
A meeting of Board of Directors of Ashoka Business Corporation Ltd. is held on 30th June, 2017 at its registered office, 1, Ashoka Marg New Delhi, in which board considered and approved company’s financial statement for the F/Y ending 31st March, 2017 and made declaration of 20% dividends on its equity shares. You being the Company Secretary, draft the minutes of Board meeting.
Answer:
Minutes of the 3rd Meeting of the Board of Directors of Ashoka Business Corporation Ltd., held on Friday, the 30th June, 2017 at 9 AM at Registered Office of the Company i.e., 1, Ashoka Marg, New Delhi.
Present:
- Mr. A, Chairman
- Mr. B, Director
- Mr. C, Director
- Mr. D, Managing Director
In Attendance:
- Mr. X Company Secretary
Invitees:
- Mr. Y Chief Financial Officer
Question 1.
Chairman for the Meeting
Answer:
Mr. A being the Chairman of the Board chaired the Meeting.
Question 2.
Leave of absence
Answer:
Leave of absence from attending the Meeting was granted to …………… and …………… who expressed their inability to attend the Meeting to the Company Secretary owing to their pre-occupation.
Question 3.
Quorum
Answer:
The business before the Meeting was taken up after having established that the requisite quorum was present.
Question 4.
Minutes of the previous Board Meeting
Answer:
The Minutes of the ……….. Meeting of the Board of Directors of the company held on at …………, as circulated along with the agenda, were noted by the Board.
Question 5.
Minutes of the Committee Meetings
Answer:
The Minutes of the ……….. Meeting of the ……………. Committee(s) held on …………….., as circulated along with the agenda, were noted by the Board.
Question 6.
Financial Statements
Answer:
The draft balance sheet as at 31st March 2017, the statement of profit and loss for the year ended 31st March 2017 and the cash flow statement for the year ended 31st March 2017 of the Company were placed before the Board for its approval.
Mr. Y made a detailed presentation to the Board on the financial statements. The Chairman of the Audit Committee confirms that there were no adverse remarks/observations of auditor on financial statements.
The Board, after discussion, passed the following Resolution:
“Resolved That pursuant to the provisions of Section 134 of the Companies Act, 2013, the Financial Statements for the year ended 31st March 2017 comprising the Balance Sheet as at 31st March 2017, Statement of Profit and Loss for the year ended 31 st March 2017 along- with the Notes to the Financial Statements and Cash Flow Statement derived from the Financial Statement for the year ended 31st March 2017, as recommended by the Audit Committee at its meeting held on May 2017 be and are hereby approved.
Resolved Further That the Balance Sheet as at 31st March 2017, the Statement of Profit & Loss for the year ended 31st March 2017 and the Cash Flow Statement derived from the Accounts for the year ended 31st March 2017 be and are hereby signed on behalf of the Board by Mr. ________ (DIN:), Director, Mr. ________ Managing Director (DIN:), Mr. ________, Chief Financial Officer and Mr. ________ , Company Secretary.
The meeting was adjourned for receipt of Auditors’ Report. Thereafter, the Statutory Auditor submitted his report on the Financial Statement for the year ended 31st March 2017 and the meeting resumed. The Board noted that there were no qualification/adverse remarks in the said Report and after deliberation passed the following Resolution:
Resolved That the Annual Financial Statements of the Company for the year ended 31st March 2017, as approved by the Board and the Auditors’ Reports thereon, be presented to the shareholders for adoption.”
Question 7.
Dividend
Answer:
The payment of Dividend for the year ending 31st March 2017 was considered on the basis of the audited Financial Statements of the company for the period from 1st April 2016 to 31st March 2017. The Directors opined that there were adequate profits/free reserves to permit payment of Dividend.
The Board, after discussion, recommended payment of final dividend @20% per equity share and passed the following Resolution: “resolved That pursuant to the provisions of Section 123 of the Companies Act, 2013 and the rules made thereunder, final Dividend 20% amounting to ₹ per equity share is and hereby recommended
to be paid on all equity shares, out of the profits of the company for the year ending 31st March 2017, after providing for depreciation in accordance with the provisions of the Companies Act, 2013, whose names appear in the Register of Members of the company on the …………… of ……………. (date).
Resolved Further That the transfer books and the Register of Members be closed from the ……………. of …………… to the ………………. of …………. (dates), both days inclusive, for the purpose of payment of such dividend.
Resolved Further that the Dividend Distribution Tax shall be borne by the Company.”
Question 8.
Opening of a Bank Account for payment of Dividend
Answer:
The Board passed the following resolution for opening a bank account for the purpose of payment of Dividend:
“RESOLVED THAT a Bank Account be opened in the name and style of ‘Ashoka Business Corporation Ltd. – Dividend ………………’ (Bank Account) with the …………… for payment of Dividend for the financial year ending 31st March 2017.
RESOLVED FURTHER THAT the said Bank be and is hereby authorised to honour cheques/bank advices etc. drawn, accepted or made on behalf of the company and to act on any instruction(s) so given concerning the said Account by any two of the following signatories: …………..
RESOLVED FURTHER THAT the said Bank be and is hereby autho¬rised to change the name and style of the Bank Account to ‘Ashoka Business Corporation Ltd. Unpaid Dividend ……………’ on and from ……………….
RESOLVED FURTHER THAT the authorised signatories be and are hereby authorised, in the manner stated above, to give instructions to the said Bank to close the Bank Account on disbursement of the Dividend.
RESOLVED FURTHER THAT the authorised signatories be and are hereby authorised, in the manner stated above, to sign and execute such documents, letters etc., as may be required by the said Bank.”
Question 9.
Conclusion of the Meeting
Answer:
There being no other business, the Meeting concluded at ….(Time) with a vote of thanks to the Chair.
Date ……………. ……………… Chairman
Place ……………..
Entered on
(To be initialled by the Company Secretary)
Question 8.
You have been appointed as a Company Secretary of a Company. What would you ensure to comply with the provisions of Companies Act, 2013 regarding Quorum for Board Meeting? Narrate the Decision Making Process at Board as enunciated in the Act.
Answer:
As per section 174 of the Companies Act, 2013 and as per Secretarial Standard on Meetings of the Board of Directors (SS-1) provides that:
One third of total strength
or
Two directors,
whichever is higher, shall be the quorum for a meeting.
If due to resignations or removal of director(s), the number of directors of the company is reduced below the quorum as fixed by the Articles of Association of the company, then, the continuing Directors may act for the purpose of increasing the number of Directors to that required for the quorum or for summoning a general meeting of the Company. It shall not act for any other purpose,
Participation by a director through Video Conferencing:
For the purpose of determining the quorum, the participation by a director through Video Conferencing or other audio visual means shall also be counted. If at any time the number of interested directors exceeds or is equal to two-thirds of the total strength of the Board of directors, the number of directors who are not interested and present at the meeting, being not less ^ than two shall be the quorum during such time.
The meeting shall be adjourned due to want of quorum, unless the articles provide shall be held to the same day at the same time and place in the next week or if the day is National Holiday, the next working day at the same time and place.
Decision making process at the Board Meeting –
1. The Chairman and/or Managing Director should explain the proposal put up before the Board, the background and the expectation of the proposal in the short as well as the long-term to contribute to the growth of the company. If needed, a presentation may be made by the executive concerned for easing the considerations and discussions of the Board as they tend to highlight the key elements within the written data.
2. The criticality and viability of the proposal should be explained and their views should be elicited from all angles.
3. The Board could then deliberate all these issues and come to a decision.
Question 9.
KLM Ltd. in its 64th Board meeting held on 30th June, 2019 has constituted Risk Management Committee with objective of mitigation of risk and recommendation of preventive measures comprising of two Independent Directors and one Whole Time Director. In the first Meeting? of the Committee held on 6th July, 2019, Whole Time Director could not he present and sought the leave of absence. The Board proposal about: the constitution was silent with respect to Chairman of the Committee and quorum of the Meeting of Committee. The remaining two members held the Meeting and the Senior most Director present in the Meeting was selected as Chairman of the Committee. The Committee also approved the policy for Systematic Risk Management. Whether, the decision of the Committee is valid in light of the approved Secretarial Standards as issued by the ICSI?
Answer:
The Secretarial Standard 1 (SS-1) deals with the Meetings of the Board of Directors.
Clause 3.5 of Secretarial Standard 1 (SS-1) which relates to the Meetings of Committees provides as under:
“Unless otherwise stipulated in the Act or the Articles or under any other law, the Quorum for Meetings of any Committee constituted by the Board shall be as specified by the Board. If no such Quorum is specified, the presence of all the members of any such Committee is necessary to form the Quorum”.
In the given case of the company KLM Ltd., it is mentioned in the question itself that.
“The Board proposal about the constitution was silent with respect to Chairman of the Committee and quorum of the Meeting of Committee”.
Since the quorum was not specified, hence as per the clause 3.5 of SS-1, where no such quorum is specified, the presence of all the members of such committee is necessary to form the quorum. Therefore, the meeting was held by the Risk Management Committee (RMC) without the presence of adequate quorum and in view of this the decision taken by the RMC is also invalid.
Question 10.
Board of directors of IT Solutions Ltd. conducted its adjourned meeting on a public holiday in the month of October, 2015. The Board meeting was adjourned due to lack of quorum. Can the articles of association of a company fix such a quorum?
Answer:
Following are the key points on quorum of a Board meeting:
1. According to Section 174 of the Companies Act, 2013, one third of total strength or two directors, whichever is higher, shall be the quorum for a meeting.
2. Directors who participate by way of Video Conferencing or other visual means shall also be counted for the purposes of quorum.
3. Any fraction of a number is to be rounded off to one.
4. Total strength does not include directors whose places are vacant.
5. If the number of continuing directors is reduced below required quorum, continuing Directors may act for the purpose of increasing directors to such number which is required as quorum or for summoning a General Meeting and for no other purpose.
6. Where at any time the number of interested directors exceeds or is equal to two thirds of the total strength of the Board of Directors, the number of directors who are not interested directors and present at the meeting, being not less than two, shall be the quorum during such time.
Thus where a board meeting could not be held due to absence of quo-rum then the meeting shall be adjourned to the same day at same time and place in the next week, if that day is a National Holiday then at the next day which is not a National Holiday at same time and place. This provision is not applied if the Articles of Company provide otherwise. Further, the Articles of Association of Company can stipulate a higher quorum.
Question 11.
Answer the following in brief; What are Companies (Meeting of Board and its Powers) Second Amendment Rules, 2017? Briefly explain.
Answer:
The details of Companies (Meeting of Board and its Powers) Second Amendment Rules, 2017 are as under:
1. Meeting through electronic mode:
Any director who intends to participate in the meeting through electronic mode may intimate about such participation at the beginning of the calendar year and such declaration shall be valid for one year. Such declaration shall not debar him from participation in the meeting in person in which case he shall intimate the company efficiently in advance of his intention to participate in person.
2. Preservation of draft minutes of video conferencing:
When a Board meeting is held through video conferencing or other audio visual means, the draft minutes recorded shall be preserved by the company till the confirmation of the draft minutes in accordance with rule 3(12).
3. Committees of the Board:
The Board of directors of every listed company and a company covered under rule 4 of the Companies (Appointment and Qualification of Directors) Rules, 2014 shall constitute an ‘Audit Committee’ and a ‘Nomination and Remuneration Committee of the Board’.
Question 12.
CSB Ltd. a Listed Company is holding a Meeting of Board of Directors. The Agenda Items inter alia include the item for approval with respect to declaration of Interim Dividend for current fiscal. However, information of the Meeting as well as for closing of the trading window has already been intimated to the Stock Exchange. There are 7 members on (he Board of Directors. On the date of Meeting, 2 Directors were out of Country, whereas the remaining Directors were present in the Meeting.
The Directors in abroad were willing to participate through video conferencing. One of the Independent Directors objected that the item for declaration 2 of Interim Dividend can’t be discussed through video conferencing and should be deferred for ensuing physical meeting of Board of Directors. Examine in the light of the provisions of the Companies Act, 2013 and list out the matters which shall not be dealt with in any meeting held through video conferencing or other audio visual means.
Answer:
Sec. 173(2) of the Companies Act, 2013 read with Rule 4 of the ‘ Companies (Meetings of Board and its Powers) Rules, 2014 prescribes restriction on following matters which shall not be dealt with in any meeting held through video conferencing or other audio visual means:
- The approval of the annual financial statements.
- The approval of the Board’s report.
- The approval of the prospectus.
- The Audit Committee Meetings for consideration of financial statements including consolidated financial statements to be approved by the Board;
- The approval of the matter relating to amalgamation, merger, demerger, acquisition and takeover.
Provided that where there is quorum in a meeting through physical presence of directors, any other director may participate through video conferencing or other audio visual means but he shall not be counted in quorum.
As per the rule discussed above, there is no restriction on discussing declaration of interim dividend through video conferencing. Also, if the majority of directors are present in the meeting physically, other directors can participate through video conferencing even though they shall not be counted in quorum.
Question 13.
Write a note on the following; Day, time, place, mode and serial number of a board meeting.
Answer:
Following are the key points on day, time, place, mode and serial number of a board meeting:
- Every Meeting shall have a serial number.
- A Meeting may be convened at any time and place, on any day.
- Notice of the Meeting shall clearly mention a venue, whether registered office or otherwise, to be the venue of the Meeting and all the recordings of the proceedings of the Meeting, if conducted through Electronic Mode, shall be deemed to be made at such place.
- Any Director may participate through Electronic Mode in a Meeting unless the Act or any other law specifically prohibits such participation through Electronic Mode in respect of any item of business.
Question 14.
Briefly explain the contents of minutes of a meeting.
Answer:
According to Secretarial Standards 1, following are the contents of a minutes of a meeting:
- The names of Directors present and their mode of attendance, if through Electronic Mode.
- In case of a Director participating through Electronic Mode, his particulars, the location from where he participated and wherever required, his consent to sign the statutory registers placed at the Meeting.
- The name of Company Secretary who is in attendance and Invitees, if any, for specific items and mode of their attendance if through Electronic Mode.
- Record of election, if any, of the Chairman of the Meeting.
- Record of presence of Quorum.
- The names of Directors who sought and were granted leave of absence.
- Noting of the Minutes of the preceding Meeting.
- Noting the Minutes of the Meetings of the Committees.
- The text of the Resolution(s) passed by circulation since the last Meet-ing, including dissent or abstention, if any.
(Note: This list is inclusive and not exhaustive)
Question 15.
Write a note on the following; List of items of business for the Agenda of the First Meeting of the Board of the company.
Answer:
Following are the list of items of business for the Agenda for the First Meeting of the Board of the company:
- To appoint the Chairman of the Meeting.
- To note the Certificate of Incorporation of the company, issued by the Registrar of Companies.
- To take note of the Memorandum and Articles of Association of the company, as registered.
- To note the situation of the Registered Office of the company and ratify the registered document of the title of the premises of the registered office in the name of the company or a Notarised copy of lease/rent agreement in the name of the company.
- To note the first Directors of the company
- To read and record the Notices of disclosure of interest given by the Directors.
- To consider appointment of Additional Directors.
- To consider appointment of the Chairman of the Board.
- To consider appointment of the first Auditors.
- To adopt the Common Seal of the company, if any.
(Note: This list is inclusive and not exhaustive)
Question 16.
Write a note on the following; list of items of business which shall not be passed by circulation and shall be placed before the Board at its Meeting.
Answer:
Following is the list of items of business which shall not be passed by circulation and shall be placed before the Board at its Meeting
General Business Items:
- Noting Minutes of Meetings of Audit Committee and other Committees.
- Approving financial statements and the Board’s Report.
- Considering the Compliance Certificate to ensure compliance with the provisions of all the laws applicable to the company.
- Specifying list of laws applicable specifically to the company.
- Appointment of Secretarial Auditors and Internal Auditors.
Specific Items:
- Borrowing money otherwise than by issue of debentures.
- Investing the funds of the company.
- Granting loans or giving guarantee or providing security in respect of loans.
- Making political contributions.
Corporate Actions:
- Authorise Buy-Back of securities.
- Issue of securities, including debentures, whether in or outside India.
- Approving amalgamation, merger or reconstruction.
- Diversify the business.
- Takeover another company or acquiring controlling or substantial stake in another company.
Additional list of items in case of listed companies:
- Approving Annual operating plans and budgets.
- Capital budgets and any updates.
- Information on remuneration of Key Managerial Personnel.
- Show cause, demand, prosecution notices and penalty notices which are materially important.
- Fatal or serious accidents, dangerous occurrences, any material effluent or pollution problems.
(Note: This list is inclusive and not exhaustive)