Skip to content

CS Professional · Environmental, Social and Governance (ESG) - Principles and Practice · Board Disclosures and Website Disclosures

Arvind Textiles Ltd, a listed company, has a Managing Director, a CEO, a CFO and a Company Secretary, all appointed. Its Board has approved the financial statements. Who must sign them on behalf of the Board before they go to the auditor, assuming the chairperson has not been authorised by the Board?

The financial statements must be signed by two directors, one of them the Managing Director, along with the CEO, CFO and Company Secretary, because the chairperson is not authorised and all those officers are appointed. Signing by fewer persons does not satisfy the Companies Act requirement.

  1. ATwo directors, one of whom is the Managing Director, together with the CEO, CFO and Company SecretaryCorrect
  2. BAny one director together with the Company Secretary only
  3. CThe statutory auditor together with the Managing Director
  4. DOnly the Chief Financial Officer, since he prepares the accounts

Explanation

Under section 134(1), approved financial statements are signed by the chairperson if authorised by the Board, or else by two directors, one being the managing director, and by the CEO, CFO and company secretary wherever appointed. Here no authorisation exists and all officers are appointed, so all of them sign. Signing by the CFO alone or by one director is insufficient.

Did you get it right without looking?

One question tells you little. A timed set on Board Disclosures and Website Disclosures shows your real accuracy, how long you take and where you lose marks.

Practise Board Disclosures and Website DisclosuresFree diagnostic mock

More Board Disclosures and Website Disclosures questions