Is Caro Applicable to Subsidiary Company

v. with respect to deposits accepted by the Company or amounts considered to be deposits, that the directives issued by the Reserve Bank of India and the provisions of sections 73 to 76 or other relevant provisions of the Companies Act and, where applicable, the rules set out therein have been complied with, otherwise, the nature of the offences; where an order has been issued by the Corporate Law Board or the National Corporate Law Tribunal or the Reserve Bank of India or a court or other tribunal, whether or not it has been complied with; Compliance with the regulations applicable to a Nidhi company: – Maintain the ratio of net ownership of equity on deposits of 1:20 to meet liabilities. – Maintenance of 10% term deposits (which are not encumbered) to meet liabilities. – details of any delay in the payment of interest on deposits or repayments for any period. (b) whether the investments made, the guarantees provided, the guarantees provided and the conditions for granting all loans and advances in the form of loans and guarantees do not adversely affect the interests of the company; No. CARO 2020 applies to audit reports of companies registered under the Companies Act 2013. Since LLP is registered under the Limited Liability Act 2008, CARO 2020 does not apply to it. There is significant uncertainty at the time of the audit report regarding an assessment of: – Report on ageing, key financial figures and expected dates of realization of financial assets and payment of financial liabilities, all other information accompanying the financial statements, knowledge of the board of directors and management plans by the auditors. – Opinion on whether the entity can meet the liabilities that exist at the balance sheet date if those liabilities become due in the future. Subsection 143(11) of the Act provides that the central government may order the inclusion of a statement on specific matters in the auditor`s report for a particular class or description of entities.

Accordingly, CARO 2020 will be adopted pursuant to section 143(11) of the Companies Act, 2013 to include the matters set out therein in the auditors` report. Therefore, CARO 2020 should be respected by the auditor of each entity to which it applies. (b) if the company has engaged in financial or housing finance activities outside the banking sector without a valid registration certificate from the Reserve Bank of India under the Reserve Bank of India Act 1934; If the Company has conducted non-cash transactions with its directors or other persons associated with the directors, if the restrictions imposed are respected. Iv. a sole proprietorship as defined in section (62) of section 2 of the Companies Act and a small corporation as defined in section (85) of section 2 of the Companies Act; and – Was there fraud on the part of the company or fraud on the part of the company? If such fraud has been noticed or reported at any time of the year. If this is the case, the type and amount must be reported. If the Company`s auditors have filed a report on Form ADT-4 with the central government, as required by the 2014 Corporate Rules (Audit and Auditors). – In case of receipt of complaints from whistleblowers, if the complaints have been examined by the examiner.

Whether the company is required to keep cost records, whether the records were kept during the year and, if so, non-compliance. (d) whether the entity has revalued its property, plant and equipment (including rights of use) or intangible assets, or both, during the year and, if so, whether the revaluation is based on the valuation by a chartered appraiser; indicate the amount of the change if the change is equal to or greater than 10 % of the total carrying amount of the net book value of each category of property, plant and equipment or intangible assets; CARO 2020 brings an additional clause on the company`s ability to face its liability, it is again in line with the continuity of operations report recently made strict by SA 570, the above clause gives more clarity on cash flow and will add a little excitement to new companies and their fund management. Auditors should take a detailed justification for the above and perform a walkthrough. In accordance with the order of the Ministry of Corporate Affairs (MCA) of February 25, 2020, CARO 2020 was valid for the fiscal year (FY) 2019-20. Subsequently, the MCA amended the applicability of CARO 2020 from the 2019-2020 to 2020-21 fiscal year by its order of 17 December 2020. . .

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