The Hindu Business Line : Disclosure norms for India Inc may be eased

THE Union Government is keen to provide further relief to the corporate sector in the areas of directors' remuneration, disclosure of particulars of subsidiaries in the balance sheet of a holding company and compliance with disclosure requirements in the balance sheet and the profit and loss account.

Indications are that the Government may simplify the procedures involved for availing exemptions on disclosures mandated by company law in these three areas.

"These three issues (Section 211 and Section 212 and directors' remuneration) have to be addressed very soon. Some way has to be found out to reduce the paperwork (for corporates) to a great extent," Mr Prem Chand Gupta, Union Minister of Company Affairs, said at a national seminar on new company law organised by the Institute of Company Secretaries of India (ICSI).

The intent to reduce the paperwork for corporates in the three areas appears to be independent of the Government's plan to re-codify the company law. The Companies Act 1956 stipulates through Section 211 that the profit and loss account and the balance sheet have to be prepared in the format specified under Schedule VI. The same section also allows the Union Government, on an application from a company, to modify any of the requirements on matters to be stated in the balance sheet or the profit and loss account for the purpose of adapting them to the circumstances of the company.

Even Section 212, which relates to disclosure of particulars of subsidiaries in holding company statements, provides that the Union Government could, on application, grant exemptions from disclosure of particulars of subsidiaries in the holding company's balance sheet.

"In all the three areas, including directors' remuneration, the corporates have to approach the Government if they want exemptions from disclosures. The Government may grant the exemptions or deny them. But there are procedures and costs involved for making the application. The intent now is to provide relief against such procedures and paperwork," a senior official from the Ministry of Company Affairs said.

The official declined to comment on the method that would be adopted or the extent of relief. "There are a number of options available before the Ministry. I can't say whether the relief would be given through an administrative order or would it be through an amendment to the Companies Act," the official said.

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Disclosure norms for India Inc may be eased

Govt wary of allowing grocery shops to hawk OTC drugs

Move to curb advertising of prescription drugs

Infosys may consider share split suggestion

Wealth management by banks poised to grow

Govt to consider all stakeholders' interest on board composition norms