Draft Format of Directors Report of One Person Company or Small Company :Draft Format – Directors Report- One Person Company – Small Company w.e.f. 31.07.2018 ,MCA has further amended the Companies (Accounts) Rules, 2014, these rules called the Companies (Accounts) Amendment Rules, 2018.

[Click here for Draft Format of Directors Report for company other than One Person Company or Small Company]

As per Companies amendment Act, 2017 it was notified that MCA shall issue abridge form of Directors Report for One Person Company and Small Company.

MCA has come with new rule 8A on 31^stJuly, 2018 for abridge form of Directors report disclosure by prescribing separate bunch of disclosures for Small Company and One Person Company.

Therefore, we can opine that If a Company (Small / OPC) Holding Board meeting for approval of Directors Report as per Section 134 on or after 31^stJuly, 2018 such Companies have to use the new format of Director Report.

Draft Format of Directors Report with Provisions is as follow:

One of the Major Amendments in relation to Directors Report is w.e.f. 31.07.2018 there is no need to prepare the MGT-9 and annex the same with Directors Report.

Disclosures to be mentioned in Directors Report:

a) The web address, if any, where annual return referred to in sub-section (3) of section 92 has been placed;

b) Number of Meeting of Board of Directors

c) Directors responsibility statement as referred in sub-section 5 of section 134

d) Details in respect of frauds reported by auditors under sub-section (12) of section 143 other than those which are reportable to the Central Government.

e) Explanations or comments by the Board on every qualification, reservation or adverse remark or disclaimer made by the auditor in his report.

f) The state of the Companys affairs;

g) The financial summary and highlights;

h) Material changes from the date of closure of the financial year in the nature of business and their effect on the financial position of Company.

i) The details of directors who were appointed or have resigned during the year;

j) The details or significant and material orders passed by the regulators or courts or tribunals impacting the going concern status and companys operation in future.

With this amendment, the number of matters to be stated in Board’s Report of OPC and small companies has been drastically brought down and understandably so.

However, even based disclosures still have to be give by such Companies Board Report Like : CSR, ESOP, A case in point herein is disclosure regarding compliance with applicable SS as per para 9 of Secretarial Standard-1 etc .

Draft Format of Directors Report of One Person Company or Small Company

Dear Members,

XYZ PRIVATE LIMITED

Your Directors have pleasure in presenting the(No. of AGM)Annual Report together with the Audited Statement of Accounts of your Company for the Year ended March 31, _______.

1 . FINANCIAL SUMMARY

The Companys financial performance, for the year ended March 31, __________:

(Rs in Lacs)

2. STATE OF AFFAIRS / HIGHLIGHTS

1. The Company is engaged in the business of ___________________________. There has been no change in the business of the Company during the financial year ended 31st March, _________.

2. There has been no change in the business of the Company during the financial year ended 31st March, ___________.

3. CHANGE IN DIRECTORSHIP

There has been no change in the constitution of Board during the year under review i.e. the structure of the Board remains the same.
OR
If there is any change, mentioned that Mr. has been resigned/ appointed w.e.f. ____________ as Director / MD/ etc of Company.

4. BOARDS COMMENT ON THE AUDITORS REPORT

The observations of the Statutory Auditors, when read together with the relevant notes to the accounts and accounting policies are self explanatory and do not call for any further comment.
OR
(Explanation or comment by the Board on every qualification, reservation, adverse remark or disclaimer made by the statutory auditor in his report and/or by the secretarial auditor in the secretarial Audit Report)

5. MEETINGS OF BOARD OF DIRECTORS

(No. of Board Meeting) ___________Board Meetings were held during the Financial Year ended March 31, __________ i.e. (Dates of Board Meetings).

6. WEB LINK OF ANNUAL RETURN, IF ANY.

The Company is having website i.e.___________________________ and annual return of Company has been published on such website. Link of the same is given below:
OR
The Company doesnt having any website.

7. MATERIAL CHANGES AND COMMITMENTS

No material changes and commitments affecting the financial position of the Company occurred between the end of the financial year to which this financial statement relates and the date of this report
OR
The following material changes and commitment occurred during the year under review affecting the financial position of the Company.

8. DETAILS OF SIGNIFICANT AND MATERIAL ORDERS PASSED BY THE REGULATORS, COURTS AND TRIBUNALS

No significant and material order has been passed by the regulators, courts, tribunals impacting the going concern status and Companys operations in future.
OR
The details of a significant material order passed by the Honble High Court which may impact the going concern status of the Company and its future operations is provided in Annexure ___and forms part of this report

9. DIRECTORS RESPONSIBILITY STATEMENT

Pursuant to Section 134(5) of the Companies Act, 2013 the Board of Directors of the Company confirms that-

a) In the preparation of the annual accounts for the year ended March 31, __________, the applicable accounting standards read with requirements set out under Schedule III to the Act, have been followed and there are no material departures from the same.

b) The Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company as at March 31,__________ and of the profit of the Company for the year ended on that date.

c) The Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Act for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.

d) The Directors have prepared the annual accounts on a ‘going concern’ basis.

e) The Company being unlisted, sub clause (e) of section 134(3) of the Companies Act, 2013 pertaining to laying down internal financial controls is not applicable to the Company.

f) The Directors have devised proper systems to ensure compliance with the provisions of all applicable laws and that such system are adequate and operating effectively.

SIGNING OF BOARD REPORT:

134(6) The Boards report and any annexures thereto under sub-section (3) shall be signed by its chairperson of the company if he is authorised by the Board and where he is not so authorised, shall be signed by at least two directors, one of whom shall be a managing director, or by the director where there is one director.

(Author CS Divesh Goyal, GOYAL DIVESH & ASSOCIATES Company Secretary in Practice from Delhi and can be contacted at [email protected]).

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