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CA Intermediate · Corporate and Other Laws · Companies Incorporated Outside India

Borealis Pharma Corp., a foreign company with a place of business in Hyderabad, has its financial statements prepared in its home country as required there. Under the Companies Act, 2013, what must Borealis do about its accounts in respect of its Indian business?

Borealis must prepare its balance sheet, profit and loss account and other prescribed documents as if it were an Indian company and file copies with the Registrar every year. The duty does not depend on profit or on a request, and home country accounts alone are not enough.

  1. ANothing, because home country accounts are sufficient
  2. BPrepare a balance sheet and profit and loss account in the prescribed form and file copies with the Registrar every year, along with the prescribed documentsCorrect
  3. CFile accounts only if it has made profit in India
  4. DFile accounts only when the Central Government asks for them

Explanation

Every foreign company must, every calendar year, make out a balance sheet, profit and loss account and other documents as if it were a company under the Act, and deliver copies to the Registrar. The duty does not depend on profit or on a government request. Hence home country accounts alone are insufficient.

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