Difference between MGT-7 and AOC-4

Companies in the corporate world must comply with various requirements laid down by the Companies Act, 2013. One of them includes annual Roc filling, which includes filling of MGT-7 & AOC-4, which must be filed annually; these are called annual filling regarding the Companies Act, which the company has to do at the end of every year.

What is MGT-7 & AOC-4?
MGT-7 is an e-form provided by the ministry of corporate affairs to fill in details relating to annual returns. MCA maintains the record of MGT-7 filed by the companies based on the statement of correctness given by the company. In contrast, AOC-4 is also an e-form that must be filed to fill the annual financial statements for each financial year with the registrar of companies (ROC).

Who is required to file MGT-7 & AOC-4?

MGT-7All companies reported under the Companies Act, 2013 are required to file MGT-7 for its annual returns.AOC-4All companies reported under the Companies Act, 2013 are required to file AOC-4 for filling financial statements.AOC-4-XBRL

• All companies registered with any stock exchange in India and their Indian subsidiaries.
• All companies with a capital of 5 crores or above.
• All companies with a turnover of 100 crores or more.
• All companies which were enclosed till date under the companies rules 2011.

Purpose

AOC-4

MGT-7

A financial statement of a company represents the financial position of the company. It is also the way of communication between the board of directors & shareholders. Companies are required to file AOC-4 for filling their financial statements.The form MGT 7 is filed for annual return; however it restrains all the particulars as similar to emerge in the closing of the financial year.

Due dates for filing

AOC-4

MGT-7

Under normal circumstances, form AOC 4 should be filed within 30 days from the last date of the company’s annual general meeting (AGM) held in a relevant assessment year.Form MGT-7 is to be filed within 60 days from the date of the company’s annual general meeting.

Details required to be filled

AOC-4

MGT-7

Companies general details — such as its corporate identity number (CIN); details about its director/s, manager, CEO, CFO and all who signature company’s financial statements and board report; factors about auditor and SRN of ADT-1 etc.Details of registered office, primary business activities, details of its holding, subsidiary and associate companies.Information relating to the balance sheet for the financial year.Details of shares, bonds and other securities and shareholding pattern of the company financial obligations of the company.Information relating to the profit & loss for the financial year.Details of members and debenture-keepers and changes associated with them since the end of the last financial year.Information about the share capital raised during the year.Details promoters, directors, key managerial personnel along with changes associated with them since the end of the last financial year.Details about the company’s principal products or servicesDetails of meetings of members or a class thereof, board and its numerous committees across with attendance.Factors relating to corporate social responsibility (CSR) reporting.Details of payment of directors and principal managerial personnel.Details regarding the related party transaction.Details of shareholding format.

Attachments required:

AOC-4

MGT-7

Board report along with annexures: MGT-9, AOC-2, CSR Report, corporate governance report, secretarial audit report etc., as per the nature of the company and financial statements.List of shareholders, debenture holders, share transfer, MGT-8.

Together, these forms constitute annual Roc fillings required by the company to comply with every year. Non-Compliance with these attracts penalties as given below:

AOC-4

MGT-7

• Delay up to 30 days — 2 times of usual filing fees.
• More than 30 days and Up to 60 days — 4 times of usual filing fees.
• More than 60 days and up to 90 days — 6 times of usual filing fees.
• More than 90 days and up to 180 days — 10 times of usual filing fees.
• More than 180 days and up to 270 days — 12 times of usual filing fees

Rs. 100 per day up to to the date such non-filling continues.

A full-time practice requires a statement confirming the authenticity of the information entered in the form. Such a professional shall also digitally sign the document and declare that the information is verified.

We assist our clients in dealing with compliances related to company incorporation, business setup, ROC filings, winding up of the company etc. If you have any questions or wish to know more about MGT-7 and AOC-4, kindly contact us.

Amendment to Schedule III of Companies Act 2013

 

MCA has revised Schedule III of Companies Act 2013 to increase strictness in compliances and add several additional disclosures in Financial Statement. The main purpose behind these amendments is more clarity.

Financial statement of the company The Ministry of Corporate Affairs (MCA) vides notification dated 24 Mar 2021 has revised Schedule III to the Companies Act, 2013, which shall be effective from the 1st day of April 2021. Earlier companies had to round off the figures developing in the financial statements based on “turnover”; however, based on the latest amendment, circulating off will be based on your company’s “total income”.

Purpose of amendment In recent years, there have been significant changes in the detailed requirement by the auditors, but no such corresponding amendments were made in Schedule-III for the preparation of the financial statements. Thus, to range the company’s financial statements in accordance with the auditor’s reporting requirements, the following amendments have been considered in this write-up. majority of the amendments to Schedule III to the Companies Act, 2013 have been assumed in response to the amendments protected in the newly issued Companies (Auditors and Report Order) 2020 and the Companies (Indian Accounting Standards) Amendment Rules, 2020.

Brief on amendments to Schedule III Division I, to the Act (for Companies whose financial statements are required to observe with the Accounting Standards):

• General instruction for preparation of balance sheet

1. Rounding off It’s choice to do rounding off of figures till fiscal year ended 31.03.2021. To round off the figures appearing within the Financial Statements for the fiscal year ending 31.03.2022, the entire income of the corporate shall be considered because of the basis.
2. Additional disclosure in notes to balance sheet Shareholding of promoter The note on share capital in the financial statements shall mention details of the shareholding of the advances along with changes, if any, during the financial year.
3. Additional disclosure in notes to profit & loss account: Undisclosed Income (Reconciliation of Income Tax and Companies Act) The company shall give specific transaction not recorded in the books of accounts that has been surrendered or disclosed as income during the year in the tax assessments under the Income Tax Act, 1961, unless there is exclusion for disclosure under any scheme and also shall state whether the previously unrecorded income and related assets have been properly recorded in the books of account during the year.

We assist our clients in dealing with compliances related to company incorporation, business setup, ROC filings, and winding up of the company etc. if you have any questions or wish to know more about Amendment under Schedule III of Companies Act, kindly contact us.

Source: newcompanyregistrationindia.com