Introduction

A Private Limited Company in India is one of the most trustworthy and convenient ways to run a business, which has more credibility and easier scalability. However, the Companies Act, 2013, as well as several tax and regulatory norms, place a plethora of compliance requirements on such companies.

If these obligations are not performed, penalties may result, along with loss of effectiveness or loss of registration by the RoC.  When startups, small and medium enterprises (SMEs), and growing businesses are not compliant, they face regulatory scrutiny. Plus, their investors are inclined to be sceptical of them. Starters’ Chief Financial Officer helps businesses at every stage of their journey without losing their cool.

Director-Related Compliance Requirements

All Private Limited Companies must follow rules regarding directors. First is to get a Director Identification Number (DIN) for all directors of the company. Moreover, every financial year, KYC must be filed by the director in DIR-3 KYC. Directors must submit a declaration claiming their eligibility. They must also claim non-disqualification.  Furthermore, they must comply with other requirements. Starters’ CFO makes sure that all documentation related to the two directors is updated, correct and compliant.

Mandatory Board Meetings and Minutes

A privately held firm must organise at least four board meetings in a year. Also, there should not be a gap of more than 120 days between any two meetings. The minutes of the meetings must be recorded, approved, and kept safely. Board meetings are vital for the approval of the enterprise’s financial statements, strategies and the recording of the decisions made. The corporation may be penalised, in accordance with the provisions of corporate law. Starters’ CFO will assist the firms in planning, documenting and systematically retaining all board meeting records.

Annual General Meeting (AGM)

The AGM of the company must be held within six months of the end of the Financial Year. In this meeting, the directors present the audited financial statements, approve a dividend if applicable, appoint auditors and examine the business performance. Decisions taken at AGM must be recorded and filed.  New companies may find this process difficult. Starters’ CFO offers relief with documentation, filing, and reporting to ensure compliance.

Statutory Registers and Records

A Private Limited Company must keep many category registers like the register of members, directors, share transfer, charge, loan, etc. These registries must be regularly updated and are the official record of corporate activity. The outcome could be dire if no records are present during ROC inspection and due diligence. The Chief Financial Officer of Starters states that the updates to all your statutory registers are up to date and audit-ready.

Appointment and Rotation of Auditors

Each organisation or association must appoint a statutory auditor within 30 days of its incorporation. An appointment must be approved by the board and must be confirmed at the first AGM. An auditor is generally appointed for five years, and can be appointed again and again. The appointment must be filed through Form ADT-1. Starters’ CFO manage the entire auditor appointment process to ensure that the companies comply with audit rotation and reporting standards.

Annual ROC Filings

The foundation of corporate compliance is the annual filing with the Registrar of Companies. There are mainly two forms: AOC-4, which has finances and a board report, and MGT-7A or MGT-7 annual return. Filings must be done within the time frame to avoid penalties.  If you do not meet the filing deadline even by a few days, the late fees will be heavy. Starters’ CFO helps firms stay compliant with the Ministry of Corporate Affairs by ensuring timely and accurate ROC Filings on their behalf.

Income Tax Compliance

A private limited company must file an ITR (Income Tax Return) irrespective of its profit-generating ability or turnover. Make sure to submit your TDS returns, pay your advance tax, and carry out tax audits on time. To ensure compliance with all revenue laws and given the recording of expenses, organisations need to classify expenses correctly. Starters’ CFO helps businesses adhere to laws regarding taxes and tax compliance.

GST Compliance Requirements

Every business that has registered itself under GST has to file monthly, quarterly, or annual returns. You would need proper GST invoicing, ITC reconciliation and timely payments to keep your stocks penalty and notice free. Companies must see to the establishment of a process of evolution of GST regulations. Starters’ CFO helps businesses meet all their compliance needs for filing tax returns, reconciliations and GST advisory. And making sure that different parties have no compliance gaps or disputes.

Maintenance of Books of Accounts

As per the Companies Act, every private limited company shall maintain proper books of accounts, records of income, expenditure, assets, liabilities, as well as bank statements, invoices, and ledgers. These documents must be kept at the registered office or elsewhere as approved by the board. The processes of bookkeeping are beneficial for audits, tax filing, funding rounds, and investor due diligence. Starters’ CFO provides quality bookkeeping services that ensure your records are organised and accurate.

Filing of Event-Based Compliances

Some corporate actions must be filed with the ROC immediately. Due to these changes, changes in officials, changes in registered office, allotment of shares, transfer of shares, etc., are made. Businesses do not know about such filings, and they miss their timelines and pay a penalty. Starters’ CFO monitors events and oversees timely filings to ensure the business remains compliant.

Compliance Related to PF, ESI, and Labour Laws

When companies hire personnel, coverage is available under PF, ESI, gratuity and other labour laws. It is necessary to keep payroll records, file returns and deposit contributions on time. All businesses must check if these rules apply to them, even with low headcounts. Starters’ Chief Financial Officer Assesses the Organisational Structure and Monitors Employer Compliance.

Conclusion

Every Private Limited Company has a Continuous Duty of Compliance. All filings that ROC, taxes, statutory register, GST returns, etc., matter for being eligible and credible legally for your business to stand. Failure to comply can adversely impact funding opportunities and long-term profitable growth. When you have a Starters’ CFO, compliance is managed systematically, accurately and proactively. We do all the deliveries on time and cater to each and every requirement so that the companies might leave the compliance to the experts and focus on doing business.