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

Orchid Auto Ltd, a listed company, received a secretarial audit report from a practising company secretary containing a reservation about delayed filing of a form. How must the Board's report address it?

The Board's report must carry the Board's explanations or comments on the reservation. Section 134(3)(f) covers every qualification, reservation, adverse remark or disclaimer in both the auditor's report and the practising company secretary's secretarial audit report, with no threshold.

  1. AIgnore it, since only the statutory auditor's remarks need explanation
  2. BGive explanations or comments by the Board on the reservationCorrect
  3. CRefer it to the Registrar and omit it from the report
  4. DMention it only if the penalty exceeds a prescribed amount

Explanation

Section 134(3)(f) requires the Board's report to include explanations or comments on every qualification, reservation, adverse remark or disclaimer made by the auditor and also by the company secretary in practice in the secretarial audit report. There is no materiality or penalty threshold in the clause.

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