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CS Professional · Compliance Management, Audit and Due Diligence · Secretarial Audit

During the secretarial audit of Ganga Foods Ltd, the CS in practice, Ms Rao, finds that the finance team delays handing over statutory registers and minutes. Which provision of section 204 is most directly engaged?

Section 204(2) makes it the company's duty to give all assistance and facilities to the company secretary in practice for auditing secretarial and related records. Withholding or delaying registers and minutes breaches that duty, exposing the company and defaulting officers to the section 204(4) penalty.

  1. ASection 204(2): the company must give all assistance and facilities to the company secretary in practice for auditing the secretarial and related recordsCorrect
  2. BSection 204(1): the Board must appoint a second auditor to retrieve the records
  3. CSection 204(3): the auditor must delete the matter from the report
  4. DSection 204(4): the auditor alone becomes liable to a penalty of two lakh rupees

Explanation

Section 204(2) places a duty on the company to give all assistance and facilities for auditing the secretarial and related records. Delay in handing over records breaches this duty. Section 204(4) penalises a company or officer in default, not the auditor merely for the company's obstruction.

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