Overview of ROC Compliances for Public Limited Company

The advantages of annual compliances with ROC regulations and rules for public companies are as mentioned below:

• Enhances transparency: ROC compliance ensures that public companies in India maintain transparency in their operations, financial statements and corporate governance practices. It promotes accountability and helps build trust among shareholders, investors and the general public.
• Legal compliance: By adhering to ROC requirements, companies fulfil their legal obligations under the Companies Act, 2013 and related regulations. This helps them avoid penalties, legal disputes and reputational damage.
• Improved corporate governance: ROC compliance emphasises the implementation of robust corporate governance practices. It encourages companies to establish effective internal control mechanisms, maintain accurate records and follow ethical business practices. This can lead to better decision-making, risk management and overall organisational efficiency.
• Investor confidence: Complying with ROC regulations instils confidence in investors by showcasing a company's commitment to transparency, integrity and legal compliance. It gives investors the access to reliable information about the company's financial performance, operations, management practices and the like.
• Access to capital markets: Public companies that are ROC compliant are more likely to attract investments from both domestic and international sources. Compliance acts as a positive signal for potential investors, as it demonstrates the company's commitment to meeting regulatory standards and ensures the availability of accurate information for investment decisions.
• Protection of stakeholder interests: ROC compliance protects the interests of various stakeholders, including shareholders, employees, creditors and customers, thereby ensuring that the company operates in a responsible and accountable manner while also safeguarding the rights and interests of these stakeholders.
• Ease of doing business: By maintaining ROC compliance, public companies streamline their administrative processes, record keeping and reporting requirements, thereby facilitating ease of doing the business by reducing bureaucracy, enhancing efficiency, promoting good governance practices within the company.
• Mitigation of risks: Compliance with ROC regulations help companies identify, assess and mitigate potential risks associated with their operations. It enables them to implement appropriate internal controls, risk management frameworks and compliance procedures, reducing the likelihood of legal and financial risks.
• Competitive advantage: Being ROC compliant can provide a competitive advantage for public companies as it has the potential to distinguish them as responsible and trustworthy entities in the market, enhancing their brand reputation and attracting customers, partners and top talent.
• Avoidance of legal consequences: Non-compliance with ROC requirements can lead to penalties, fines, legal proceedings and even potential dissolution of the company. Therefore, it is by adhering to compliance obligations that public companies can avoid such negative consequences and maintain their legal standing in such a competitive market.

What is the Importance of Complying with ROC Annual Compliances?

It is important to highlight that a Public Company has an obligation to fulfil annual compliances starting from its incorporation. Non-compliance presents numerous challenges for the company, including the imposition of penalties and fines. To avoid such situations, it is important to have a comprehensive understanding of the relevant compliances and ensure their timely fulfilment. This is especially critical for Public Companies, as they are required to provide accurate financial information to shareholders and investors.

By adhering to the necessary compliances, a company showcases its commitment to transparency, accountability and sound corporate governance. This demonstrates the company's dedication to operating ethically and responsibly within the regulatory framework.

It is therefore imperative for Public Companies to prioritise annual compliances and fulfil them diligently to avoid legal consequences, financial implications and reputational damage.

The following documents are necessary for the annual compliances of a public company:

Balance Sheet and the Profit and Loss Account:

• Provides an overview of the financial status of the company.
• Includes information on the assets, liabilities, income, expenses, etc.

Financial Statements:

Standalone financial statements or consolidated financial statements may be required.

• Consolidated financial statements combine the financial performance of subsidiaries and associates.

Directors' Report:

• Gives an understanding of the company's operations, financial performance and also its future prospects as a business doing company.
• Includes information on achievements, challenges, corporate governance practices and sustainability initiatives.

Details of the Members:

• Contains information about members or shareholders.
• Includes names, addresses, shareholding patterns and changes in shareholdings.

Details of the Directors:

• Provides information about the company's directors.
• Includes names, addresses, qualifications, experience and changes in directorship.
• May disclose their interests in other companies.

Secretarial Certificate and Other Necessary Documents:

• Additional documents, such as a secretarial compliance certificate, may be required.
• Compliance with specific requirements of the Companies Act and other applicable laws is necessary.

What are the Annual Compliances for Public Limited Company?

When it comes to the annual compliances for a public limited company in India, the following are the main and significant requirements:

• Annual Return in Form MGT-7: This form should be filed with the relevant Registrar of Companies (RoC) within 60 days of the Annual General Meeting (AGM). It includes updated information about directors and shareholders.
• Financial Statements in Form AOC-4: The filing of this form with the RoC is required within 30 days of the AGM. It encompasses various important documents, such as the Balance Sheet, Profit and Loss Account, Directors' Report, Cash Flow Statement, Auditor's Report and Consolidated Financial Statement. In India, listed public limited companies are mandated to prepare their Financial Statements using the Extensible Business Reporting System (XBRL). This system ensures standardised and digital reporting for enhanced transparency and accessibility of financial information.
• Form ADT-1: The appointment of the company's auditor should be filed within 30 days from the date of incorporation in Form ADT-1, as approved by the Board of Directors.
• Form MGT-8: Public companies with a paid-up share capital of Rs. 10 crore or more or an annual turnover of Rs. 50 crore or more must obtain certification by a practising Company Secretary.
• DIR-3 KYC: All directors need to file Form DIR-3 KYC to complete their Know Your Customer (KYC) verification with the RoC. Existing directors need to verify the OTP received via email and mobile, while new directors must submit this form.
• Form DPT-3: The Return of Deposit should be filed with the RoC in Form DPT-3.
• Form MBP-1: In the first board meeting, every director should disclose their interest in any company, firm or other entities, including shareholding interests, by filing Form MBP-1.
• Income Tax Returns: Public limited companies must file their Income Tax Returns with the Income Tax Department by 30th October. Tax audit is mandatory if the annual turnover exceeds Rs. 1 crore.
• Secretarial Audit Report in Form MR-3: All public limited companies, whether listed or unlisted, should submit the Secretarial Audit Report along with the Board Report if their paid-up capital reaches or exceeds Rs. 50 crore or their annual turnover equals or exceeds Rs. 250 crores.
• Compliance with SEBI Regulations: Public limited companies, especially those listed on stock exchanges, need to fulfil all the annual compliances under SEBI regulations, including the Listing Regulations of 2015.
• Form MGT-14: The adoption of financials and Director's Report should be filed within 30 days from the board meeting, along with a copy of the board meeting minutes.
• Form MGT-15: This form contains an exclusive report on the Annual General Meeting (AGM) of the company.

Event-Based Annual Compliances: These refer to the various obligations that a (listed) public limited company needs to fulfil throughout the year. These obligations encompass internal company administration, external business management, corporate growth initiatives, as well as any unforeseen or contingent activities that may arise.

Annual Compliances under other Applicable Laws: In addition to the company-specific requirements, public limited companies are also obligated to comply with various other laws. These laws encompass areas such as Labour and Employment, Corporate and Commercial, Excise and Custom, RBI (Reserve Bank of India), FEMA (Foreign Exchange Management Act), Intellectual Property, Pollution Control, PF (Provident Fund) and ESI (Employee State Insurance) Regulations, Maritime and Admiralty Laws and more.

The process of ensuring ROC compliances by a public company involves the following steps:

• Complete Simple Checklist: Begin by going through a simple checklist that outlines the necessary tasks and requirements for annual compliance. This will be helping you ensure that you have all required information as well as documents in order to move forward.
• Submit Documents: This step involves gathering of all the relevant documents, like for ex. financial statements, auditor's report, director's report and any other necessary records, ensuring that they are accurate and up to date. Then, submit them as per the specified guidelines to the appropriate authorities, like the Registrar of Companies.
• Preparation of Notice, Director Report and Forms: Prepare the required notices, such as the notice for convening the AGM. Additionally, prepare the director's report that provides an overview of the company's performance, activities and other relevant details. Complete any necessary forms as per the regulatory requirements.
• Filing of Annual Compliance Forms: File the completed forms and documents with the relevant authorities, such as the RoC. This may involve submitting the annual return and the financial statements (including the balance sheet, profit and loss statement and cash flow statement) electronically through the MCA portal. Ensure that all forms are filled out accurately and comply with the prescribed formats.
• Receipt of Acknowledgement: After successfully filing the annual compliance forms, you will receive an acknowledgement from the authorities. This acknowledgement serves as confirmation that your compliance filing has been received and processed. Keep this acknowledgement for your records as proof of compliance completion.

What are the Consequences of Non-compliance?

The annual compliance requirements and associated penalties for directors and companies in the event of non-compliance are mentioned below. Failure to adhere to these annual compliance obligations by a public company will result in the following consequences:

By fulfilling ROC annual compliances, public companies demonstrate their commitment to transparency, accountability and good corporate governance. Compliance not only helps mitigate legal and financial risks but also fosters trust among shareholders, investors and other stakeholders. It is essential for public companies to prioritise these compliances and stay updated with any regulatory changes to ensure smooth operations and long-term success.

Startupfino is a company that specialises in offering complete services for ROC Compliances of Public Company. We can help you with everything from providing advice in the initial phase to ensuring that you meet all the necessary requirements and compliances. 

Our services include the following:

• Comprehensive ROC Compliance Solutions tailored to meet the specific needs of public companies in India.
• Expert guidance and assistance in filing Annual Returns, Financial Statements and other necessary forms with the ROC.
• Timely and accurate preparation of documents such as Directors' Report, Auditor's Report and Secretarial Audit Report.
• Regular monitoring and tracking of compliance deadlines to avoid penalties and non-compliance issues.
• Expert advice on maintaining necessary registers, records and documentation as per legal requirements.
• Providing ongoing support and updates on changes in ROC compliance regulations to keep the company informed and prepared.

By availing our services, entrepreneurs can avoid the negative outcomes of non-followance of rules and compliances. StartupFino works hard so as to provide services that are prompt as well as effective, so you can manage your business without any issues and without facing any penalties or problems.